1998(11)LCX0180

IN THE CEGAT, COURT NO. II, NEW DELHI

S/Shri A.C.C. Unni, Member (J) and V.K. Agrawal, Member (T)

COMMISSIONER OF CUS., NEW DELHI

Versus

H.C.L., HEWLETT PACKARD

Final Order No. 907/98-B2, dated 18-11-1998 in Appeal No. C/84/96-B2

Advocated By : Shri R. Panchatcharam, JDR, for the Appellant.

Shri H.N. Mathur, Manager (Excise), for the Respondents.

[Order per : V.K. Agrawal, Member (T)]. - The issue involved in this appeal preferred by the Revenue is whether the sound Blaster Cards, Video Blaster Cards and T.V. Coder to generate sound and video signals are classifiable under sub-heading 8473.30 as held by the Commissioner (Appeals) or under sub-headings 8519.99 and 8521.90 as classified by the adjudicating authority in the Order-in-Original.

2. Shri R. Panchatcharam learned DR, submitted that the importers had imported multimedia kits containing sound cards and classified whole kit as sound reproducing equipment, but has sought classification of sound card which is one of the components of the kits separately imported as accessory to the computer; that a component of the kit is classifiable under the same heading where the kit is classified unless the component is specifically included in any other heading. He further submitted that the equipments imported by the respondents are merely connected to P.C. and the speakers to produce sound effect or connected to TV screen or video monitor to produce visual effects. He further submitted that the imported goods are complete units within themselves and are required to be connected to co-devices, i.e., the computer to send digital signals. He further contended that these are not parts but complete units within themselves and are classifiable according to their function.

3. Shri H.N. Mathur, Manager (Excise) of the respondents countered the arguments by submitting that the imported equipments cannot function without being incorporated in the computer. He also relied upon the minutes of the Commissioner’s conference in which the classification of multimedia kit/sound cards, etc., was discussed. After the conference, the classification of sound card, video cards and multimedia kit was decided to fall under sub-heading 8473.30. It was also mentioned in the minutes that sound card and video card are parts and accessories of computers and cannot be classified under Heading 85.21 as per HSN notes at page 1367; that Heading 85.21 would cover only items which reproduce sound and images on TV only. He finally mentioned that the Commissioner of Customs directed the Custom House to do the classification accordingly.

4. We have considered the submissions of both the sides. Sub-heading 8473.30 applies to the parts and accessories of the machines of Heading 84.71, i.e., automatic data processing machines and units thereof. Heading 85.19 covers turntables (record-decks), record players, cassette players and sound reproducing apparatus, not incorporating a sound-recording device and Heading 85.21 covers video recording or reproducing apparatus, whether or not incorporating video tuner. We observe that the Commissioner (Appeals) in the impugned order had found substantial force in the importer’s contention that the goods imported could work only as accessories to the computer. The Commissioner (Appeals) also observed that sound cards cannot be classified under Heading 85.19 as they had no sound head or the video cards under Heading 85.21 as that covers items which reproduce sound and images on TV only. In respect of TV coder, the Commissioner (Appeals) gave her finding that it is mounted PCB which is different from video recording or reproducing apparatus. These findings of the Commissioner (Appeals) have not been rebutted by the Revenue in the appeal memorandum. We also observe that the Department itself has subsequently classified the imported items under Heading 8473.30. Accordingly, we find that there are no reasons to interfere with the impugned order and accordingly the appeal filed by the Revenue is rejected.

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Equivalent 1999 (105) ELT 362 (Tribunal)