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Showing contexts for: HS classification in Cc vs Pooja Exports (India) And Delhi ... on 8 December, 1999Matching Fragments
1. Since classification under Customs Tariff Act as well as under ITC (HS) of V.-O-Video Cassette Housing is common to both these appeals, though Appeal No. C/714/97 also involves the similar classification for Jewel Box, the two appeals are being taken together for consideration, by common consent.
2. Briefly, the Order-in-Appeal impugned by the Revenue before us namely C. Cus. 761/97 had not considered the question of classification under the Customs Tariff Act but has classified the Video Cassettee Housing under heading 392340.00 of ITC (HS) and has held that the import thereof is free i.e. without any licence. The Revenue on the other hand, presses for classification under heading 392310.01 under ITC (HS), which requires an import licence, the item being categorised as restricted. The attendant Orders-in-Original had classified the Video Cassettee Housing under Customs Tariff Heading 8523.90, whereas the respondents before us have claimed its classification under heading 3923.40.
4. With respect to the appeal of M/s. Pooja Exports (India) on the item CD Jewel Box, the learned D.R. submits that the Order-in-Appeal impugned has not specified any reasons as to how the lowering of the redemption fine to Rs. 1,50,000/- has been arrived at and hence the matter has been decided arbitrarily and needs to be remanded to the original authority for re-consideration on actual facts, so that an objective decision is available to Revenue.
5. The learned Consultant for both the respondents submits that as far as the Video Cassettee Housing is concerned, the matter lies in the respondents favour, in view of the revised HSN Explanatory Notes with effect from 1.1.1996, wherein under heading 39.23 Note (b) specifies "spools, cops, reels and similar supports including video or audio cassettes without magnetic tape." He further submits that therein while at the six digit level heading 3923.10 mentions 'boxes, cases, grades and similar articles', heading 3923.40 mentions 'spools, cops, bobbins and similar supports'. When heading 39.23 is read with the above Note (b), it is clear that video or audio cassettes without magnetic tape, which is nothing but housing a box in question would be classified as "spools, cops, bobbins and similar supports" and hence it would fall under 3923.40. The learned Consultant further submits that the ITC (HS) also has a similar classification under 392340.00 corresponding to this classification under the Customs Tariff and under HSN and therefore, there is total concordance between the HSN Notes and Customs Tariff and ITC (HS) on this issue and hence for ITC (HS) the classification under 392340.00 has been correctly arrived at in the Order-in-Appeal impugned. This view, he submits is also supported by Compendium of Classification Opinions issued by World Customs Organisation under Harmonized System Nomenclature, which places video or audio cassettes without magnetic tape under heading 3923.40. It is explained therein that the housing merely serves as a container for the spools. The learned Consultant further submits that as far as the Central Excise Tariff Act is concerned, at the six digit level there is no harmony between the HSN Explanatory Notes, Compendium of Classification Opinions, Customs Tariff, ITC (HS) vis-a-vis Central Excise Tariff, inasmuch as that the Central Excise Tariff does not have any sub-heading under 3923.40 at all specifying the products namely "spools, cops, bobbins and similar supports"; and therefore, of necessity the two decisions of the Tribunal cited, which are under Central Excise Tariff only had to classify them under 39.26, which is the residual heading. Therefore, these two decisions stand distinguished in law as far as the Customs Tariff as well as ITC (HS) is concerned, being in the context of Central Excise Tariff. He also submits that even if it is considered that both the Customs as well as Central Excise Tariff apart from the ITC (HS) are all aligned with the Harmonised System of Nomenclature upto four digit level, then the Explanatory Notes and the Compendium of Classification Opinions would rule, being a Mother of the Tariff. He, therefore, submits that as far as the Video Cassettee Housing is concerned, there is no infirmity in the Order-in-Appeal impugned.
7. The learned D.R. counters that even though the Order-in-Appeal impugned mentions that such a letter was submitted by the respondents indicating 129% as the margin of profit in respect of Jewel Box, in the findings of the learned Commissioner (Appeals), there is no discussion on this issue and therefore, the Revenue is aggrieved that the decisions contained therein does not indicate the basis on which it was arrived at.
8. We have carefully considered the rival submissions and records of the case. We have also perused the various entries in the Customs Tariff, Central Excise Tariff, ITC (HS) and the WCO's Compendium of Classification Opinions noted above, as also the HSN Explanatory Notes, particularly in the Edition revised on 1.1.1996 and as on page 620 thereof dealing with Heading 39.23. On a careful consideration of these, we are of the considered opinion that the decisions cited by the learned D.R. stand distinguished with respect to the law contained in the Customs Tariff as well as ITC (HS) because in the Central Excise Tariff after the four digit level namely 39.23 there is no entry of 3923.40 in the six digit level. As against this, the Customs Tariff, ITC (HS) as well as Explanatory Notes all carry the entry 3923.40 at the six digit level. The Tribunal had therefore, considered the classification under heading 39.26 only in the context of the residual entry available in the Central Excise Tariff, in view of there being no entry under 3923.40. Therefore, the said decisions noted above are to be distinguished with reference to goods imported and with reference to classification under Customs Tariff as well as under ITC (HS).
9. We further find that at the six digit level there is total concordance between the Customs Tariff and the ITC (HS) both for the item 3923.10 as well as 3923.40. However, the ITC (HS) goes for a further sub-classification at the eight digit level. Herein is contained the root of the dispute with respect to the Video Cassette Housing. Whereas the Revenue contends that the appropriate ITC (HS) classification is under 392310.01, the respondents preferred 3923.40. Since both these documents claimed to be totally aligned to the Harmonised System of Nomenclature, therefore, of necessity we have to traverse through this source of document namely the Explanatory Notes thereof to resolve this issue. Therein the products "spools, cops, bobbins and similar supports" are falling under 3923.40. Note (b) of the said Notes under heading 39.23 (page 620) further amplifies the scope of this heading to include "video or audio cassettes without magnetic tape". It is not in dispute that the Video Cassette Housings imported are in effect Video or Audio cassettes without magnetic tape. Therefore, taking this clear notes into consideration, we have no hesitation in concluding that the item under import would be classifiable under 3923.40 as far as the Customs Tariff Act is concerned and therefore, also under 392340.00 as far as ITC (HS) is concerned. Since the ITC (HS) under that classification allows free import of goods, we find that the Order-in-Appeal impugned does not contain any infirmity at having arrived at the same conclusion as ours recorded above. In this connection, it is our considered opinion that the item 392310.01 concerns with "plastic container for audio or video cassettee, cassette tapes, floppy discs etc.". A plain reading of this description would show that the plastic container considered therein is the one in which a complete audio or video cassettes or even floppy discs could be packed. In the present case, what is imported is not such a container because in terms of Note (b) of the HSN, the video cassette without magnetic tape is distinguished from a complete video cassette. Therefore, it is crystal clear that this heading under 392310.01 is with respect to a outer plastic container which is used to pack the finished video or audio cassette or even floppy disc. As against this, the item 392340.00 of ITC (HS) would directly apply to the unfinished video or audio cassette which is distinguished from the finished video cassette. In fact, this distinction further throws light on the classification of the next item namely CD Jewel Box. Since this plastic box is used to pack fully finished Compact Disc (CD), therefore, by the same logic, it had been rightly classified under 392310.01 and the learned Consultant has fairly chosen not to press this issue.