TMI Blog2017 (4) TMI 1002X X X X Extracts X X X X X X X X Extracts X X X X ..... e for concessional rate of duty as claimed by the Importer Appellants. - C/85893/15, C/85896/15, C/85898/15, C/85316/16, C/85317/16 And C/85318/16 - A/86633-86638/17/CB - Dated:- 4-4-2017 - Mr. M.V. Ravindran, Member (Judicial) And Mr. C.J. Mathew, Member (Technical) Shri Atul Nanda, Sr. Advocate, Shri Ashish Batra, Advocate - for appellant Shri V.K. Singh, Spl. Counsel - for respondent ORDER Per M. V. Ravindran These appeals are directed against orders-in-original No.CC-RS/08/2014-15 ACC (Adj) (I) dated 28.11.2014, CC-RS/10/2014-15 ACC (Adj) (I) dated 31.12.2014 and PR.CC/DS/11/2015-16 Adj (I) ACC dated 10.11.2015. 2. The issues which essentially arise for consideration in these appeals are- (a) Whether goods imported which are external/ portable hard disk drives are classifiable under declared CTH 8471 70 20 as Hard disk drives or under CTH 8471 7030 as Removable or Exchangeable Disc Drives ? (b) Whether the appellants / importers are eligible for a concessional rate of duty of customs claimed by them for the said product under Exemption Notification Nos.6/2011 CE dated 01.03.2011 (Sr. No.17) and 12/2012-CE dated 17th March 2012 (Sr. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (CTH 8471 70 70) can also be internal as well as external . It is not the contention of the Revenue that all these drives whether Floppy Disc Drive, CD Rom Drives or DVD Drives, if imported as external plug in devices, are being classified only as Removable or Exchangeable Disc Drives under CTH 8471 7030 and that they lose their identity as Floppy disc drives, CD Rom Drives and DVD drives respectively, for the purpose of classification and/or exemption. 4.6 The fact that the goods are external disk drives is not in dispute, but what is contended by Revenue is that since the external hard disk drive is admittedly a plug-in device, it is more appropriately classifiable as Removable or Exchangeable Disc Drives under CTH 8471 7030, and exemption shall not be available. 4.7 It is also that a sample of such imported external hard disk drive was also shown during the hearing in support of the above undisputed factual position. We have seen that the data media' in the subject imported drive is such, which can neither be removed from the drive , nor is the same exchangeable. 4.8 It is also that another sample containing one set, comprising of a data media in the form ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing were present in the meeting: (i) Mr. Raj Singh, CSIR-CEERI, Pilani (ii) Ms. Sunita Verma, Director, DeitY (iii) Dr. S. Chatterji, Additional Director, DeitY (iv) Ms. Asha Nangia, Additional Director, DeitY The comments / technical opinion of the Committee are as under: (i) The Notification No.12/2012 - Central Excise dated 17th March, 2012 provides for duty exemption to goods covered under the heading 8471 70 covering hard disk drives along with other items. (ii) The CTH in the notification is at 6 digit level which would mean both the hard disk drive viz. hard disk drives and removable or exchangeable are covered by the exemption notification. (iii) Earlier in Notification No.12/2012 - Central Excise dated 27.2.2010, there were two categories for the items in the category 8471 70 or 847330 or 8523 51 00 namely, (i) meant for fitment inside the CPU housing/laptop body only; and (ii) meant for external use with a computer or laptop as a plug-in device and the custom duty benefit was Nil in the first category and 4% in the second category. Now, in the present notification separate categorization is not there and the custom duty benefit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l as sample of removable or exchangeable disk drive during the course of hearing. We note that the classification of external disc drive assumes significance because of concessional rate of duty available to only hard disk drive not to removable or exchangeable disc drives. The Revenue considers the imported items under 84717030 whereas the impugned order by the Commissioner (Appeals) held the product under heading 84717020. The later entry is eligible for concessional CV duty. We have examined the impugned order and grounds of appeal, closely. First of all, we note that the exemption notification specified tariff heading to six digit only, 847170, which covers specifies tariff heading up both, hard disk drive and removable or exchangeable disk drives. Further, the next column of the table for description explain the goods only as hard disk drive among many other items. On careful consideration of the technical specification furnished, and the sample of imported items along with tariff entries and the exemption notification, we are in agreement with the findings in the impugned order. The terms hard disk drive used in the notification has not been amplified either by adding *exter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d other materials may throw some light as to the classification of the products in question.... The said Appellant Importer preferred Civil Appeal before the Hon ble Supreme Court with the following prayers- Prayer 5. In view of the abovementioned facts and circumstances, it is respectfully, prayed that this Hon ble Court may be pleased:- (i) to quash and set aside the impugned miscellaneous order No.94488/16/CB dated 13.12.2016 passed by the Hon ble Tribunal to the extent it has re-listed the Appellants appeal for denovo consideration, instead of allowing the same; (ii) consequently, to quash and set aside the Final Order No.A/90720-90723/CB dated 04.10.2016 passed by the Hon ble Tribunal in Appeal No.C/85898/15-MUM and to allow the said Appeal in terms of the prayers contained therein; Vide Order dated 13.01.2017, after perusing the relevant material and hearing the Counsel for the appellant importer, the Hon ble Supreme Court was pleased to dismiss the said Civil Appeal D. No.42407 of 2016, without disturbing the Order dated 13.12.2016 by which the earlier Order dated 04.10.2016 in these appeals was recalled and the appeals were directed to be r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Video Disc Drive 8471 70 90 Others The above sub-classification of drives shows that in the various entries, the words preceding the word drives,describe the type of data media suitable / used /to be used in that drive. The different types of drives are thus sub-classified based on the particular type of data media suitable for that drive. Thus, CTH 8471 70 10 covers Floppy disc drive, i.e. a drive for data media floppy disc;CTH 8471 70 20 covers Hard Disc Drives, i.e. a drive for data media hard disc;CTH 8471 70 30 covers Removable or Exchangeable Disc Drives, i.e. a drive for data media Removable or Exchangeable Disc;CTH 8471 70 40 covers Magnetic tape drives, i.e. a drive for data media magnetic tape;CTH 8471 70 50 covers Cartridge tape drives, i.e. a drive for data media Cartridge tape;CTH 8471 70 60 covers CD- ROM drive i.e. a drive for data media CD-ROM;CTH 8471 70 70 covers Digital video disc drive i.e. a drive for data media DVD; and the CTH 8471 70 90 being a residuary heading would cover all other types of drives with data media not specified above. Vide Circular No.105/2003-Cus dated 16.12.2003 the Board has clarified that item Stor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the drive. There is no removable or exchangeable disc which finds place inside the hard disc drive. 13. It is not the removability or exchangeability or portability of the drive per se which defines its classification, but rather that of the data media suitable for that drive. The data media ought to be a removable or exchangeable disc in order to classify it as a removable or exchangeable disc drive. This important and most fundamental distinction has been lost sight of by the Department. The sample of removable or exchangeable disc drive was also shown to us, which leaves no scope for any argument for the heading 8471 70 30 being rendered redundant. 14. We have also noticed another very important aspect. Notification No.12/2010 CE dated 27.02.2010 issued by the Central Government prescribed two different rates of exemption from duty i.e. 'Nil' and 4% for various drives of CTH 8471.70 including Floppy disc drive , Hard Disc drive , CD-ROM drive, DVD Drive / DVD writers, and Combo drive, depending upon whether drives were meant for fitment inside the CPU housing / laptop body or were meant for external use with a computer or laptop as a plug-in device. Thus, even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... depending upon whether they were meant for fitment inside the CPU housing / laptop body or were meant for external use with a computer or laptop as a plug-in device. The sub-division of Hard Disk Drives into further two categories internal or external for the purpose of exemption was given away after 01.03.2011. This clearly shows legislative intent of uniform concessional duty for both types of Hard Disc drives, falling under same CTH 8471 70 at six digit level. This is another ground which lays bare hollowness in the contention of the Revenue that the external hard disk drive lose their character of hard disk drive. 20. This Tribunal in CCE vs TATA Consultancy Services Ltd, 2008 (221) ELT 217 (Tri-Bang.) in the context of same Exemption Notification 6/2006-CE had observed that- 4. On a careful consideration of the Notification in question, it is clear that from Column 2 that the goods falling under 847170 are entitled for the benefit. There is no bifurcation made to the goods falling under Sub-Headings of 84717020 or 84717090. There is no dispute that the item is Hard disk Drive, therefore, mere fact that the Hard Disk Drive have been imported in array will not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g dealt with by us. 25. All the appeals are accordingly allowed with consequential reliefs. ORDER Per: C J Mathew 26. I concur with the finding of Hon ble Member (Judicial) that the liability to duty determined in the order impugned before us is not sustainable. Normally, appending of signature to the order authored on behalf of the Bench is sufficient to signify such concurrence. Inherent in concurrence is the collegiality of the decision. The judicial decision-making process, unlike that in the other two branches of government, can be described as stylised only in form; the conclusions are determined by individual perceptions and within the broad spectrum of a mutually agreed upon conclusion, the constituents may be in accord on one or more of, but not necessarily with all, the reasons that may have been argued or that may have been set forth in the principal order. The circumstances in which our original order was recalled, heard afresh and is now decided are such that I would be rendering disservice to the mandate of the Tribunal and the scope of, rectification of mistakes, were I not to elaborate, albeit briefly, on the reasons for doing so by this separate ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tain the litmus test of common parlancethat can serve to determine classification of an imported item. Here, I may not be in full agreement because the adduced memoranda, undoubtedly attenuating the certitude in the mind of the tax authority, is only a record of inter-departmental discussion that precedes the framing of government policy. Its credentials, as well as reliability, for the intended purpose of distilling proposals into policy is without question. However, expert opinion and common parlance usage rarely coincide. Moreover, the unsolicited expert opinion, formulated in the context set out above, is yet nothing but a viewpoint, though not easily to be disregarded, till its adoption as tax policy by the Department of Revenue. It is tax policy that determines eligibility for exemption. As pointed out by Learned Authorised Representative, that consummation appears to be glaringly absent in the present issue. All too often, consensus on policy formulation follows such protracted correspondence including, but not necessarily reflecting, such expert opinion. 30. In the absence of unequivocal communication setting the issue to rest, once and for all, by the Department of Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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