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H.L. Dattu, J.

1) In this appeal, the only question, that arises for our consideration and decision is, whether the Multi-Functional Machines imported by the appellants fall under Chapter Heading 8479.89 (Residual Heading) as claimed by the Revenue or under Chapter Heading 8471.60, as claimed by the appellants, under Customs Tariff Act (hereinafter referred to as, "the Act").

2) The appellants are engaged in the trading of High Technology reproduction and Duplicating machines, printers and Multi-Functional Machines capable of discharging number of functions. During the period March, September and November, 1999, the appellants imported Xerox Regal 5799, Xerox Work Centre XD100 and Xerox work Centre XD 155df respectively and filed Bills of Entry before the Customs Officer. The appellants sought classification of these imported machines under Sub-Heading 8471.60 of the Act. The Deputy Commissioner of Customs, vide his order dated 22.02.2000 classified the imported machines under Chapter Heading 8479.89 (Residual Heading) of the Act. Being aggrieved by the same, the appellants filed an appeal before the Commissioner of Customs (Appeals), Mumbai, who by his order dated 27.02.2000, rejected the appeal and thereby confirmed the order passed by the Deputy Commissioner of Customs. The appellants questioned the said order before Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi (hereinafter referred to as, "the Tribunal"). The Tribunal, by its order dated 5.11.2002, has rejected the appeal and has confirmed the order passed by the First Appellate Authority. Aggrieved by the order passed by the Tribunal, the present appeal has been preferred under Section 130E of the Customs Act, 1962.

3) To put it broadly, the controversy between the appellants and the Revenue is with regard to the classification of Xerox Regal 5799, Xerox Work Centre XD100 and Xerox Work Centre XD155df which, according to the appellants, are Multi-Functional Machines performing the functions of printers, fax machine, copier and/or scanner and therefore, requires to be classified as Printers in Automatic Inter Processing Machine (ADD) under Chapter Heading 8471.60 and the view of the authorities under the Act and the Tribunal is that the aforesaid machines require to be classified under Chapter Heading 8479.89 (Residual Heading).

"8471.60. Inputs or output units whether or not containing storage units in the same housing."
"84.79: Machines and mechanical appliances having individual functions not specified or included elsewhere in this Chapter."

5) The Deputy Commissioner of Customs, while holding that the imported machines require to be classified under the residual heading, was of the view that the digital printer was not a unit of the automatic data processing unit as such. To qualify as a unit of an automatic data processing machine, it should be able to work only with a computer as per Chapter Note 5B. The moment it is able to perform independently of a computer, its claim to be a unit of the computer ceased to exist. Merely working in conjunction with a computer did not bestow the status of a unit of the computer as a machine. Since digital printer was not classifiable under any specific heading, the same requires to be classified under residual heading. It is also observed that the machine is capable of functioning as a stand alone digital copier even without a computer and therefore, in terms of note 5(E) of Chapter 84 of the Act, the imported machine cannot be classified under heading 84.71. The Appellate Authority while deciding the appeal filed by the appellant has concurred with the finding and conclusion reached by Deputy Commissioner of Customs. The Tribunal, while accepting the view of the authorities under the Act, inter-alia, has observed that the machines in dispute are Multi-Functional Machines based on digital technology and performs the functions of a printer, scanner and digital copier and the said machines are not solely or principally used in an automatic data processing machine and further observed that the earlier decisions rendered by the Tribunal in the case of MX Software Services Ltd. v. Commissioner of Customs, Mumbai 2001 (131) ELT 422 (Tri-Del) is clearly distinguishable on facts.

6) Sri V. Lakshmi Kumaran, learned counsel appearing for the appellants, has argued in great detail for the classification of imported machines - Digital Printer under heading 84.71.60. In the course of his detailed submissions, he has explained that a printer performs the function of printing documents, which works alongside a computer. The printing is carried out by the computer giving orders in the form of a digital signal, which is transmitted through wires, converted into a readable language, and then printed. He has gone on to explain the function of a scanner, which converts documents into digital signals for storage in the computer. In this way, the scanner and printer serve as input and output devices for the computer. He further explains the purpose of a digital scanner, which copies the document and sends it to the central processing unit of the computer; independently, the copier can also print on its own after scanning. Thus, according to the learned counsel, a copier serves as a combined scanner-cum-printer. The learned counsel submits that while the Multi-Functional Machines (which includes printer, scanner and copier) are not Automatic Data Processing Machines (in short, "ADPM"), they serve as input and output devices of an ADPM (computer) and thus they fall under sub- heading 84.71.60. It is further contended that the Chapter heading 84.71 covers ADPM and units thereof, which when read with chapter note 5(C) to chapter 84 of the Act clearly establishes that the heading would include both ADPMs as well as separately presented units of ADPMs. He also relies on some of the explanatory notes of the Harmonized System of Nomenclature (for short "HSN") to buttress this contention (specifically, internal page number 1406 of the HSN Handout). He submits that the "unit" referred to in Chapter heading 84.71 is not restricted to essential parts and components of an ADPM, as there is a separate Chapter heading 84.73 which deals with the same, and that does not apply in the instant case. It is also pointed out by Sri V. Lakshmi Kumaran that the decision of the Tribunal is erroneous on three grounds, namely, (i) the Tribunal ought not to have placed reliance on chapter note 5(B)(a); (ii) the relevant chapter notes 5(B)(b) and 5(B)(c) have not been relied on; (iii) after relying on chapter note 5(B)(a), there has been incorrect application of the same. He further submits that the requirement of the Chapter, that to be regarded as a unit of an ADPM, a three-fold test, as laid out in chapter note 5(B), should be fulfilled, i.e. Chapter 5(B)(a): it is of a kind solely or principally used in ADPM; (2) 5(B)(b): it is connectable to the Central Processing Unit either directly or through one or more other units; and (3) 5(b)(c): it is able to accept or deliver data in a form (codes or signals) which can be used by the system. He submits that it is undisputed that the Multi- Functional Machines meet the requirements of chapter notes 5(B)(b) and 5(B)(c) as they are connected to a Central Processing Unit and can accept and deliver recognizable data. Further, it is argued that the term "principally" in chapter note 5(B)(a) implies "meant for" and it is clear that the Multi- Functional Machines in the present case are meant to be used with an ADPM, as neither the printing nor the scanning function can be performed without an ADPM, and little purpose will be served to the consumers if they do not perform these essential functions. Thus, there has been an erroneous finding by the Tribunal that chapter note 5(B)(a) does not apply and that the Multi- Functional Machines are not qualifiable under chapter note 5(B). As chapter note 5(B) is to be read with chapter note 5(E), he points out that the wording of chapter note 5(E) is "machines performing a specific function other than data processing and incorporating or working in conjunction with an automatic data processing machine", which does not apply as neither are the Multi-Functional Machines in the case incorporating an ADPM, nor are they presented with an ADPM, but rather are presented independently. Therefore, he submits that chapter note 5(E) has no application for the purpose of classification of the machines in dispute. Referring to chapter note 5(D), which includes printers under Chapter heading 84.71, the learned counsel submits that upto 85% of printer-related components are present in the machine and they are to function as printers. Thus, he argues the machines in dispute require to be classified only under this heading.