Indian Kanoon - Search engine for Indian Law

f) the main system is connected to an external source of power and is inter-connected to other speakers (Satellite Speakers) and depending on the source, the sound is reproduced by the entire speaker system.

g) Prima facie, these products which are new generation speaker systems are not just simple loudspeakers/audio speakers and they are multi-function devices that are meant essentially for reproducing sound and providing wholesome entertainment. (Emphasis supplied)."

35. In view of the above facts and submissions and on study of relevant product literature of the consignments under import which are 'Various types of speakers', it appeared that the main system, usually sub - woofer is equipped with a USB port, and/ or SD card reader, and / or FM radio and/ or MP3 player along with a LED display operation on the front panel.......... The main system is connected to an external source of power and is interconnected to other speakers (satellite speakers). Depending on the source, the sound is reproduced by the entire speaker system. Prima facie, these products which are new generation speaker systems, are not just simple loudspeakers/audio speakers. They are multi-function devices that are meant essentially for reproducing sound and providing wholesome entertainment. It, therefore, appears that the main system, i.e. the sound reproducing device embodied with the above stated features, which interacts with the users of the audio system or speaker system through the remote while governing the satellite (dummy) speakers attached there to, imparts the essential character to the entire system."

15. We may hasten to add here, that in terms of the HSN Notes, devices coming under 8519 having a feature of a radio could merit classification under 8527 instead of 8519. The peculiarity of tariff structure is therefore such, that all the goods falling under 8518 or 8519 or 8527 containing speaker to produce/reproduce sound could lead to a dispute, hence, the classification is made on the capability of a device and certainly not based on the function to produce/reproduce sound alone. Considering the importance of the multi-tasking/multi-functioning capabilities, different headings under 8518 or 8519 or 8527, etc. are characterized, otherwise the same would become redundant. Respective HSN notes also recognize this and hence do we find different explanatory notes. Different headings therefore appear to cover devices depending on their multi-functional Customs Appeal No. 40503 of 2022 Customs Appeal No. 40129 of 2024 Customs Appeal No. 40455 of 2024 capability and sound producing / reproducing being just a common feature.

25. Even by applying Rule 3 of GRI, where the goods are prima facie classifiable under two or more headings, classification needs to be effected as follows: -

Customs Appeal No. 40503 of 2022 Customs Appeal No. 40129 of 2024 Customs Appeal No. 40455 of 2024

26. In this case, the imported Multimedia Speaker Systems are being not Speaker Simplicitor are more appropriately classifiable under CTH 8519 as a Sound Reproducing Apparatus. These cannot be equated with loudspeakers with additional features. These systems possess technology to retrieve, read and to produce audio files of MP3/WMA audio formats from USB devices, flash drives, flash player, SD cards and can play FM radio with digital display along with Bluetooth connectivity and an interactive remote control is part of the MSS. These are multifunctional devices for reproducing sound and provide wholesome entertainment. The main system i.e., the sound producing apparatus embodied with the above stated features can interact with the users of the audio / speaker system through the remote and also through Bluetooth which imparts the essential character to the entire system which is not the case in 'Logic Trading' where the products were mere Multiple Speakers / Multimedia Speakers. The products imported are new generation speaker systems are not just simple loudspeakers / audio speakers. They are Customs Appeal No. 40503 of 2022 Customs Appeal No. 40129 of 2024 Customs Appeal No. 40455 of 2024 multi-functional devices which are meant essentially to reproducing sound for wholesome entertainment. So, we are of the view that the sound reproducing apparatus imparts the essential character to the entire Multimedia Speaker Systems. Further, our view is strengthened by the Sub-Heading Explanatory Note to Sub-Heading 8519 81: -