2025 (4) TMI 827 - AT - Customs

Classification of imported projectors - to be classified under CTH 8528 6100 as data projectors solely and principally used with Automatic Data Processing (ADP) machines or under CTH 8528 6900? - benefit of exemption - HELD THAT - The matter is no longer res integra as the issue of classification already stands settled in the appellant s own case in the case of M/s. BenQ India Pvt. Ltd. vs. ADG (Adjudication) New Delhi 2022 (9) TMI 690 - CESTAT NEW DELHI wherein the Tribunal observed as The presence of such ports is only to ensure their use with laptops and ADPS. Therefore even post 01.07.2017 goods would be classifiable under CTI 8528 62 00 and the decisions of the Tribunal rendered for the period prior to 01.07.2017 will continue to apply to projectors imported w.e.f. 01.01.2007. In view of the above decision and other large number of cases where the classification has already been settled in favour of the appellant classifying the impugned projectors under CTH 8528 6100 there are no reason to disagree with the above classification. Appeal allowed.

Summary

1. ISSUES PRESENTED and CONSIDERED

The primary issue in this case was the classification of imported projectors by M/s. BenQ India Pvt. Ltd. under the Customs Tariff Heading (CTH). Specifically, whether these projectors should be classified under CTH 8528 6100, as claimed by the appellant, which would make them eligible for certain exemptions, or under CTH 8528 6900, as determined by the Commissioner, which would deny such exemptions. The eligibility for exemption under various notifications hinged on this classification.

2. ISSUE-WISE DETAILED ANALYSIS

Relevant legal framework and precedents:

The classification of goods under the Customs Tariff Act is guided by the Harmonized System of Nomenclature (HSN) and relevant notifications that provide exemptions based on specific classifications. The appellant sought classification under CTH 8528 6100, arguing that the projectors were data projectors used principally with Automatic Data Processing (ADP) machines, thereby qualifying for exemption under Notification No. 24/2005-Cus. and others. The Commissioner, however, classified them under CTH 8528 6900, arguing that the projectors could accept input from non-ADP devices, thus not being solely or principally used with ADP machines.

Court's interpretation and reasoning:

The Tribunal reviewed previous decisions, particularly those involving similar goods and circumstances. It noted that the presence of additional features like HDMI, Composite Video, and S-Video ports does not necessarily change the principal function of the projectors as being used with ADP machines. The Tribunal emphasized that the principal use of the projectors was still data projection in conjunction with ADP machines, despite their capability to interface with other devices.

Key evidence and findings:

The appellant provided sales invoices to educational institutions to demonstrate the primary use of the projectors for data projection in educational settings. The Tribunal considered these along with prior decisions where similar projectors were classified under CTH 8528 6100.

Application of law to facts:

The Tribunal applied the legal principles from previous cases, particularly focusing on the principal use of the projectors. It concluded that the additional features did not alter the primary classification under CTH 8528 6100, as the projectors were principally used with ADP machines.

Treatment of competing arguments:

The Tribunal addressed the Revenue's argument that the projectors' ability to accept input from non-ADP devices warranted classification under CTH 8528 6900. It countered this by referencing established precedents where similar arguments were rejected, emphasizing that additional functionalities do not negate the principal use with ADP machines.

Conclusions:

The Tribunal concluded that the projectors should be classified under CTH 8528 6100, making them eligible for the claimed exemptions. It set aside the impugned order and allowed the appeal, granting consequential relief as per law.

3. SIGNIFICANT HOLDINGS

The Tribunal upheld the principle that the presence of additional features in a product does not necessarily alter its principal classification if its primary use remains consistent with the claimed classification. It reinforced the idea that projectors used primarily with ADP machines qualify for classification under CTH 8528 6100, thus benefiting from relevant exemption notifications.

Significant quotes include:

"The addition of multiple ports in the goods will not take away the basic nature of the goods, which is to work in conjunction with ADPS. This would continue to remain the principal function of the goods."

"Merely because the imported products have additional facility like attachment of Video Port, S-Video Port, HDMI, etc., the impugned goods cannot be classifiable under CTH 8528 6900."

The Tribunal's final determination was to allow the appeal, thereby granting the appellant the benefit of the exemptions under the relevant notifications by classifying the projectors under CTH 8528 6100.