2007(05)LCX0140

In the Customs, Excise & Service Tax Appellate Tribunal, Chennai

Shri P.G. Chacko, Member (Judicial) and Shri P. Karthikeyan, Member (Technical)

N.C.R. Corporation of India Ltd.

Versus

Commissioner of Customs, Chennai

Stay Order No. S/512/2007 dt. 31.5.2007 certified on 5.6.2007 C/PD/76/2007 in Appeal No. C/158/2007

Advocated By -

Shri P.C. Anand, Cons, for Appellants
Shri T.C. Rajadas, SDR for Respondent

Per P.G. Chacko :

This application is for stay of operation of the impugned order, wherein learned Commissioner (Appeals) classified the goods in question under Heading 84.79 of the First Schedule to the Customs Tariff Act, which attracts duty at the rate of 15%. The item imported by the appellants is called "iTRAN 8000", - a 'cheque processing machine'. The importer had originally described it as 'accounting machine' and classified the same under 84704010 of the First Schedule to the Customs Tariff Act. The original authority classified the goods as "cheque processing machines' under SH 84729090. Against this decision, the party went in appeal to the Commissioner (Appeals) claiming classification of the goods as "automatic data processing machine' under SH 84718000. The appellate authority rejected both the above classifications and chose to classify the goods under SH 84799090, which, incidentally, attracted the same rate of duty as the entry preferred by the lower authority. Accordingly, the original authority was directed to reassess the goods.


2. Learned consultant for the appellants refers to the manufacturer's literature on the goods and submits that it is a machine incorporating a Central Processing Unit and output and input units and capable of sorting out bank cheques through a computer-backed process involving an application software. It is submitted that, on account of these features, the machine can only be classified under Heading 84.71. In any case, the classification under Heading 84.79 cannot be sustained, according to learned consultant. It is also pointed out that the decision of the lower appellate authority is highly detrimental to the appellant's prospects of future imports. However, any bill of entry filed subsequently by the party for clearance of identical goods has not been shown to us.


3. We have heard learned SDR also, who reiterates findings of the Commissioner (Appeals).


4. The prayer in this application is for stay of operation of the impugned order. The goods in question was originally classified by the importer under a Tariff entry which is different from the one under which he presently wants the goods to be classified. The original authority classified it under Heading 84.72 for reasons noted by it. Before the first appellate authority, the party claimed classification under Heading 84.71, but that authority classified it under an entirely different Heading in the Tariff. Thus, this case is a unique show of vacillations of both the sides in the matter of classifying the goods. At present, the importer's claim is to get the goods classified as 'automatic data processing machine' under Heading 84.71. Classification being ultimately a departmental function, it has to be undertaken meticulously. It appears from the impugned order that the manufacturer's literature was not properly appreciated by the lower appellate authority. It appears from the features of the machine made out in the catalogue as also the manner in which the machine is expected to function, that it incorporates within itself a CPU and input and output units. Cheques are fed into input unit, the CPU processes them and the output unit enables the beneficiary to get the requisite information. Such a machine would prima facie be classifiable appropriately under Heading 84.71. After a perusal of the text of this Tariff entry, it appears to us that the imported item might fall for classification under "Other Digital Automatic Data Processing Machines" and more precisely under SH 8471 4090 ("- Other"). Admittedly, this classification rules out duty liability. But the importer appears to have secured clearance of the goods against payment of duty at the rate of 15%. For these reasons, we are of the view that the impugned order must be stayed. Accordingly, there will be stay of operation of that order till final disposal of the appeal.
Dictated and pronounced in open Court.

Equivalent 2007 (081) RLT 0886 (CESTAT-Che.)

Equivalent 2007 (214) ELT 0523 (Tri.- Chennai)