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2023 (7) TMI 1189 - AAR - CustomsClassification of goods proposed to be imported - Echo Dot (5lh Generation) Model No. C2N6L4 - Echo Dot (5th Generation) with clock Model No. C4E8S3 - rightly classifiable under sub-heading 85176290 under Schedule I to the Customs Tariff Act or not - exclusion categories given under serial number 20 of Notification No. 57/2017-Cus. dated 30.06.2017 - HELD THAT:- The heading 8517 of the Import Tariff, which has been suggested by the applicant for the goods in question covers Telephone sets, Smartphones and other Telephone for Cellular Networks or for other Wireless Networks; other apparatus for the transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network), other than transmission or reception apparatus of heading 8443, 8525, 8527 or 8528 - a number of articles regarding launch of Echo Dot 5th Generation in India are available in the public domain on various internet websites such as Times of India, Business Standard etc. where the goods in question have been described as 'Smart Speakers' and emphasis is on the best sound with deeper bass and clearer vocals which are the features related to principal function of the device i.e speaker. Description of Echo Dot 5th Gen by various websites indicates how the goods in question have been perceived and accepted by the general public and how such devices are being introduced before the public, which appears to be the best test to decide principal or essential function of a device and subsequently its classification under the Customs Tariff. In view of the goods in question being described as smart-speaker, it would be appropriate to discuss the coverage of goods under headings 8518. Heading 8518 covers Microphones and stands therefor: Loudspeakers, whether or not mounted in their enclosures: Headphones and Earphones, whether or not combined with a microphone, and sets consisting of a microphone and one or more Loudspeakers: Audio-Frequency Electric Amplifiers: Electric Sound Amplifier sets. Moreover, even w/o acting as communication devices for communicating with Amazon cloud/AVS, these devices can connect with smart phone and play songs taking input from the smart phone - as per Chapter Note 5 of Chapter 85, smart phones means telephones for cellular network. Applying the same analogy, smart-speakers would also mean speaker with additional functions. The heading 8517 is meant for, 'Other apparatus for transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network)'. The wordings used in the heading does not mean that an apparatus which perform a specific function with the ability to transmit, receive voice, data etc. will get classified under heading 8517. Thus, classification of the proposed items of import, “Echo Dot (5th Generation) Model No. C2N6L4 and Echo S Dot (5th Generation) with clock Model No. C4E8S3 will be under Sub-heading 85182210 of the first schedule to the Customs Tariff Act, 1975. Applicability of notifications on import of the goods - HELD THAT:- As regards applicability of exemption from duties, as per serial number 10 of Notification No. 12/2022-Cus. dated 01.02.2022, it is noted that under the said serial number of Notification No. 12/2022-Cus. dated 01.02.2022, concessional rate of duties is applicable on all goods other than hearable devices falling under Sub-heading 851821, 851822, 851829 or 851830 and as per the Notification hearable devices inter-alia means portable Bluetooth speakers comprising of an amplifier and loudspeaker(s) with maximum output power not exceeding 40 Watts, having battery as a source of power and capable of wireless connectivity through Bluetooth. As per the declaration of the applicant that the goods in question are blue-tooth/wi-fi enabled capable of wireless connectivity. Based on the above meaning of hearable devices, goods in question are hearable devices thus exemption vide serial number 10 of Notification No. 12/2022-Cus. dated 01.02.2022 is not admissible. Effective rate of duty on import of Echo Dot devices - HELD THAT:- The provisions laid down under Chapter VB of the Customs Act, 1962, relating to Advance Rulings, do not mandate giving ruling on effective rate of duty on specific goods. The applicant has also mentioned that the devices are not launched commercially in India and requested to ensure that confidentiality thereof is maintained, however in reference to specific question raised, as to if Echo Dot 5th Gen is being imported in commercial quantity, the authorized representative of the applicant has replied in affirmity. Since the commercial import of the goods in question is already underway, the maintaining confidentiality by invoking proviso to rule 27 of the Customs Authority for Advance Rulings Regulations, 2021, is not required in the instant matter.
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