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2020 (2) TMI 1247 - HC - VAT and Sales TaxClassification of goods - tablet computers with calling feature - Imposition of additional tax - CBEC Circular No.20/13-Customs dated 14.5.2013 - Whether classifiable under sub-heading No.8471 30 of the notification dated 1.8.2009 issued under Entry 45 of Schedule II to the GVAT Act? - HELD THAT:- When the excise tariff has been incorporated into the notification dated 1st August, 2009 issued in exercise of powers conferred by Entry 45 of Schedule II to the GVAT Act, then the interpretation of CBEC of such excise tariff is binding even on the authorities under the GVAT Act inasmuch as any other interpretation would defeat the very purpose of incorporation of the excise tariff in the notification issued under the GVAT Act - Apart from the Circular dated 14th May, 2013 issued by the CBEC, on facts it may be noted that till the notification dated 1.4 2011 came to be issued, the classification of the product, namely, tablet computers, under entry 8471 30 was accepted by the respondent authorities. According to the respondents, tablet computers with calling facility are required to be classified under sub-heading 8525 50 at serial No.20 of the notification dated 1st August, 2009. On a perusal of the products falling under sub-heading 8525 50 at serial No.20, it is evident that such devices are in the nature of transmission apparatus which also have a reception apparatus, the principal function whereof is transmission of sound. Moreover, even according to the respondents, the product in question is a portable automatic data processing machine. Their only contention is that it also has a calling feature and can therefore be used as a mobile phone. Reference may be made to the decision of the Supreme Court in the case of Mauri Yeast India (P) Ltd. v. State of U.P., [2008 (4) TMI 101 - SUPREME COURT], on which reliance has been placed on behalf of the petitioner for the proposition that it is now a well-settled principle of law that in interpreting different entries, attempts shall be made to find out as to whether the same answers the description of the contents of the basic entry and only in the event it is not possible to do so, recourse to the residuary entry should be taken by way of last resort. Applying the above decision to the facts of the present case, there is a specific entry viz. subheading 8471 30 which relates to portable digital automatic data processing machine. It is an admitted position that the product in question, namely, tablet computer is a portable digital automatic data processing machine. Merely because cellular phones have been deleted from sub-heading 8525 50 at serial No.20 of the notification dated 1st August, 2009 and are no longer classified as IT products, it does not mean that the a tablet computer which contains additional function of calling feature and its principal function is that of automatic data processing machine ceases to be an IT product. As held by the Supreme Court in Mauri Yeast, when the product answers the description of the contents of the basic entry, recourse to the residuary entry cannot be made. Moreover, there is a specific entry in the notification for automatic data processing machines, whereas there is no specific entry for cellular phones. This court is of the considered opinion that tablet computer is not comparable with any of the three devices which came to be deleted from sub-heading 8525 50 vide notification dated 1st April, 2011, inasmuch as, it is neither a car telephone nor a transportable telephone nor a cellular telephone. Thus, the functions mentioned and relatable to calling functions, etc. are merely incidental and the same do not alter the basic feature of the goods in question namely, tablet computers, which even according to the respondents, are portable automatic data processing machines - the respondent assessing authority is not justified in holding that the product in question, namely, tablet computers would fall under Entry 87 of Schedule II to the GVAT Act, namely, the residuary entry. The impugned rectified assessment order dated 23.2.2019 is hereby quashed and set aside - The matter is restored to the file of the assessing authority, who shall pass a fresh assessment order classifying the product in question viz. tablet computers with calling facility, under sub-heading 8471 30 under Entry 4 of the Notification dated 1st August, 2009 issued under Entry 45 of Schedule II to the GVAT Act - petition allowed by way of remand.
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