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2020 (10) TMI 398 - AT - CustomsClassification of imported goods - air-conditioners - classified under tariff item no. 84151010 of the First Schedule to Customs Tariff Act, 1975 or otherwise - argument of Revenue that the expansion of the description corresponding to tariff item no. 84151010 of the First Schedule to Customs Tariff Act, 1975, by Finance Act, 2016 is demonstrative of legislative intent to classify ‘ceiling mounted’ and ‘ceiling suspended’ air-conditioning units in other sub-headings does not find favour with us - HELD THAT:- The sanctity of the classification narrative lies in its inexorable logic from beginning to end and within itself. Hence, the groupings, as well as descriptions, have a significance that are not to be ignored. The General Rules for Interpretation also acknowledges this inherent logic and rule 3 is applicable when goods are classifiable under two headings. It is now settled law that though the importer may seek a classification it is the responsibility of the assessing officer to determine the appropriate heading; hence the application of rule 3 of General Rules of Interpretation are not intended for resolving difference of opinion between importer and assessing officer but for guiding the assessing authority in clarifying for itself when in doubt over two headings. From the impugned order, the adjudicating authority did not appear to have been beset with such dilemma. Furthermore, the said Rules, except for rule 6, are concerned with headings and hence the first mandate to an assessing authority is to determine the appropriate heading at the four-digit level. Thereafter, the six-digit and eight-digit level are to be ascertained with reference to the descriptions. The deemed erasure of any other heading thereafter precludes comparison with any tariff item that is not within the determined sub-heading. Hence, the rival entries must lie within the same group. Under the primary residuary grouping at the ‘-’ level, the distinction among the three sub-headings is determined by the incorporation of ‘refrigerating unit’, at the first instance, in ‘air conditioning machines’ and the incorporation of ‘valve for reversal of heat or cooling cycle’ subsequently. As these sub-headings and tariff items within the residuary category are so distinguished and the expression ‘refrigerating unit’ is not defined, it cannot be supposed that it refers to the ‘cooling unit’ for if it did, the first heading would have no place within the description of ‘air conditioning machines’. It, therefore, is intended for some component other than the normal cooling facility built into all ‘air conditioning machines’ and, by not subjecting that expression to the test of existence in the impugned goods, the show cause notice has tripped upon itself in its haste to carry the impugned goods beyond the scope of eligibility for the exemption notification. The applicability of sub-heading no. 841581, 841582 and 841583 to the impugned goods lacks substance. The impugned goods are not ‘window’ type but they are all of the ‘split’ type with an external condenser unit and an indoor evaporator unit. In the Explanatory Notes to the Harmonized System of Nomenclature pertaining to sub-heading no. 841510, we find no qualifying characteristic that restricts the adoption thereof to ‘cooling facility’ alone; neither is there any capacity qualification included therein - There is no doubt that the expression ‘refrigerating unit’ is not defined and we have observed that, to deem the ‘cooling unit’ to be the ‘refrigerating unit’, an entire sub-heading the tariff would stand earsed which is neither within the empowerment of the Tribunal let alone the adjudicating authority. In the absence of definition, the appreciation of common parlance meaning would have rendered the task of the adjudicating authority in this exercise more meaningful. The adjudicating authority has insinuated non-existent restrictive qualifications on the description of, and tariff item under, sub-heading no 841510 of the First Schedule to Customs Tariff Act, 1975 and that, too, without the assistance of definition of, or common parlance understanding of, the expression ‘refrigerant unit’ rendering the re-classification to lack the authority of law - Appeal allowed - decided in favor of appellant.
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