TMI Blog2022 (1) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... ices are essentially required to have internet connectivity and the same is made feasible by virtue of wifi capability of such devices. These features make the devices as smart speakers, retaining nonetheless the principal function as speaker. Therefore, guided by GIR 1 and Note 3 of section XVI of the Import Tariff, it is found that the said three devices, being treated as smart speakers, merit classification under Heading 8518; and more specifically sub-heading 8518 22 00. Echo Show 5 - Echo Show 8 - Echo Show 10 - HELD THAT:- The principal function performed by these is to act as display or monitor other than those capable of connecting to ADP machine. These devices are principally meant for, playing video from web channels or displaying video during video calling or to reproduce motion pictures as video with the help of camera installed in it - The devices named Echo Show, though neither being television reception apparatus, nor apparatus for the reception of television signals without display capabilities, are nonetheless monitors/display, not incorporating television reception apparatus. Therefore, in the light of GI Rule 3(b) and Note 3 of Section XVI of the Import Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other machines for the reception, conversion and transmission of voice, images or other data. Echo Link Amp - HELD THAT:- For determining the classification of this device, the question that needs to be answered is role/significance of the built-in amplifier, since audio-frequency electric amplifiers merit classification under sub-heading 8518 40 00 - the built-in amplifier is an additional feature of the device, not the principal determining feature, with the device having relevance even without the use of amplification feature. Therefore, holding that the principal function of Echo Link Amp is also of reception, conversion and transmission or regeneration of voice or other data, it is found that the device merits classification under Heading 8517 of the Import Tariff; and more specifically under sub-heading 8517 62 90 as other machines for the reception, conversion and transmission of voice, images or other data. Eligibility of the applicant to claim benefit of Serial Number 20 of Notification No. 57/2017-Cus., dated 30-6-2017, as amended by Notification No. 3/2021-Cus., dated 1-2-2021 - import of Echo Show 5, Echo Auto, Echo Flex, Echo Dot 4th Generation and Echo Dot 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions, 2021 (CAAR Regulations, in short), Central Board of Indirect Taxes and Customs (C.B.I. C., in short) may designate a Principal Commissioner/Commissioner, in the matter. Accordingly, upon reference by the Secretariat of CAAR, New Delhi, C.B.I. C. vide letter dated 5-4-2021 designated the Principal Commissioner of Customs, ACC (Import), New Customs House, New Delhi under the provisions of the Customs Act, 1962 read with the CAAR Regulations. 3. On designation of Principal Commissioner of Customs, ACC Import, New Delhi, in the matter, Secretariat of CAAR, New Delhi sought comments of the designated Principal Commissioner on the application for advance ruling, vide letter dated 8-4-2021. The comments of the Principal Commissioner of Customs, ACC (Import), New Delhi vide their letter dated 1-6-2021 have been received. 4. The applicant has sought ruling regarding appropriate classification of the following eleven (11) devices, which are proposed to be imported by the applicant from March, 2021. These eleven devices can be categorized Subject Echo devices [from S. No. (i) to (ix)] and the remaining two as Subject Echo Family Compatible devices [at S. No. (x) and (xi)]. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t MIMO enabled. (iv) Echo Show 5 - Digital Media Receiver (With Display Screen) with Model No. H23K37 (Echo Show 5, in short); Echo Show 5 also has a screen with front camera. With the help of this product, a user can perform various functions including accessing visual information panels. It also has manual shutter to close the camera. It has 5.5 display screen which is used for video calling with the help of camera and microphone etc. This device is not MIMO enabled. (v) Echo Show 8 - Digital Media Receiver (With Display Screen) with Model No. C7HGN3 (Echo Show 8, in short); Echo Show 8 has an 8 display screen. With the help of this product, a user can perform various functions including accessing visual information panels. The display screen can be used for video calling with the help of camera and microphone, video streaming, watching movies/online shows (on Netflix/Amazon prime/Hotstar etc.), photo display, etc. Echo Show 8 is MIMO enabled. (vi) Echo Show 10 - Digital Media Receiver (With Display Screen) with Model No. T4E4AT (Echo Show 10, in short); Echo Show 10 has a 10.1 inches display screen. With the help of this product, a user can perf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsmission Device with Model No. BP39CN (Echo Auto, in short); Echo Auto has all the common features, except it does not have a speaker for audio playback. Echo Auto has an in-built speaker for use only during initial device setup. The device is meant to be used in a motor vehicle and allows its users to connect their smartphone to the device via Bluetooth and use Alexa services in their vehicle. Echo Auto uses the data services of the smartphone connected to it to access the cloud and perform its functions. It is not capable of connecting to the internet by itself. However, Echo Auto does not have a screen or speakers for playing output media (in-built speaker is only for initial device setup). Further, the device cannot connect to the cloud on its own, but accesses the same via a smartphone through the Alexa app. This device is not MIMO enabled. (x) Echo Link - Audio Receiver with Model No. SXP16E (Echo Link, in short); Echo link, a Subject Echo Family Compatible Device, can be used for streaming Hi-Fi music to any stereo system. In other words, it upgrades a stereo system with high fidelity streaming music and Alexa services. A user can connect Echo Link to the ste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tariff Act, 1975 and effective rate of duty under such appropriate classification? (c) If the answer to question (a) is in the positive, whether the applicant is eligible to claim benefit of Serial Number 20 of Notification No. 57/2017-Cus., dated 30-6-2017, as amended by Notification No. 3/2021-Cus., dated 1-2-2021 on import of Echo Show 5, Echo Auto, Echo Flex, Echo Dot 4th Generation and Echo Dot 4th Generation with Clock? 6. The comments received from the office of the Principal Commissioner of Customs, ACC (Import), New Delhi have been shared with the applicant, as required under the CAAR Regulations. The concerned Principal Commissioner of Customs has stated, inter alia that all the eleven items are appropriately classifiable under CTH 8517 62 90, i.e. as other apparatus for transmission or reception of voice, image or other data including apparatus for communication in a wired or wireless network (such as a local or wide area network). However, no arguments have been provided in support of the suggested classification. It is also opined that on the basis of facts mentioned in the application along with work-ability and functionality of the goods, they are of the v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egulations. Therefore, the application is allowed in terms of Section 28-I(2) of the Customs Act, 1962 read with Regulation 10 of the CAAR Regulations, 2021. 10. Further, having gone through the details of the goods as described in the application, comments of the designated Principal Commissioner, submissions made at length during the personal hearing, and on perusal of other relevant material, I proceed to decide the matter and give ruling on the questions raised in the application. 11. At this juncture, I find it relevant to briefly discuss as to how these devices have been described on the website www.amazon.in, noting the salient features and functions of the products being highlighted. 11.1 Echo 4th Generation : Premium sound powered by Dolby and Alexa; awarded as the best performing smart speaker by Digit 2020; all new echo delivers premium sound. 11.2 Echo Dot 4th Generation : Smart speaker brand in India with Alexa; our most popular smart speaker now comes in a refreshed design and deliver loud, crisp sound with improved bass. 11.3 Echo Dot 4th Generation with Clock : Smart speaker brand in India with Alexa; our most popular smart speaker now comes in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted, guidance of the Harmonized Commodity Description and Coding System of the World Customs Organization, to which India is a signatory, would also be useful. 12.1 Rule 1 of the GI Rules lays down that the titles of Sections, Chapters and sub-chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes. 12.2 Rule 3 of the GI Rules provides as below : 3. When by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows : (a) the heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods. (b) mixtures, composite goods consisting of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e principal function of the three devices, namely, Echo 4th Generation, Echo Dot 4th Generation and Echo Dot 4th Generation with Clock is to reproduce sound and act as speaker. Admittedly, for these devices to function as speaker, they accept voice commands and with wifi capability manage to get the input sound for reproduction from various web channels. These devices are essentially required to have internet connectivity and the same is made feasible by virtue of wifi capability of such devices. These features make the devices as smart speakers, retaining nonetheless the principal function as speaker. Therefore, guided by GIR 1 and Note 3 of section XVI of the Import Tariff, I find that the said three devices, being treated as smart speakers, merit classification under Heading 8518; and more specifically sub-heading 8518 22 00. 13.1 The next three devices, namely Echo Show 5, Echo Show 8 and Echo Show 10 can be considered together, being similar in nature and their functioning. The principal function performed by these is to act as display or monitor other than those capable of connecting to ADP machine. These devices are principally meant for, playing video from web channels ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the reception, conversion and transmission of voice, images or other data. 13.3 The device Echo Studio has been described in the website www.amazon.in as smart speaker with high fidelity audio, Dolby Atmos and Alexa; immersive sound-5 speakers produce powerful bass, dynamic midrange and crisp highs; Dolby Atmos technology adds space, clarity and depth making Echo Studio the best sounding Echo device; five strategically positioned speakers place each instrument and vocal around the room just the way the artist intended; three mid-range speakers provide rich, natural vocals; a single tweeter produces crisp high frequencies and the downward firing woofer generates powerful, room filling bass. Therefore, Echo Studio is also smart speaker, like Echo 4th Generation, Echo Dot 4th Generation (discussed earlier), albeit of superior quality. Therefore, Echo Studio merits classification under Heading 8518; and more specifically sub-heading 8518 22 00. 13.4 The device Echo Auto is a blue tooth enabled device, taking voice command which are converted into radio frequency waves, this device enabling the user to do variety of things by simple voice command like voice call, listening to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d transmission or regeneration of voice or other data, I find that the device merits classification under Heading 8517 of the Import Tariff; and more specifically under sub-heading 8517 62 90 as other machines for the reception, conversion and transmission of voice, images or other data. 14. Having decided the question of classification of the eleven devices, I now move to the question of eligibility of the applicant to claim benefit of Serial Number 20 of Notification No. 57/2017-Cus., dated 30-6-2017, as amended by Notification No. 3/2021-Cus., dated 1-2-2021 on import of Echo Show 5, Echo Auto, Echo Flex, Echo Dot 4th Generation and Echo Dot 4th Generation with Clock. The common and distinguishing feature of these five devices, as distinct from the other seven devices covered by this application, is that these devices are not MIMO enabled. It is seen that the benefit of Serial No. 20 of the said Notification No. 57/2017-Cus. is available only to goods falling under sub-heading 8517 62 90 and 8517 69 90; with certain goods, including MIMO products, etc. being excluded even if they were classifiable under the said two sub-heading. Put simply, for a good to be eligible for the b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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