TaxTMI 
TaxTMI 
2022 (11) TMI 1421
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.... been received from the concerned Principal Commissioner/Commissioner, Air Cargo, Chennai, Airport and Air Cargo Complex, Bengaluru and Air Cargo Complex, Sahar, Mumbai. 2.2 As per the application for advance ruling, the nature of activity is proposed import of "three different models of Laser jet printer i.e., HP Laser jet 108a (HP 108, in short), HP Laser jet MFP 136a (HP 136, in short) and HP Laser jet MFP 438nda (HP 438, in short)" and advance ruling has been sought on classification of the goods under Sub-heading 8443 32 40 and 8443 31 00 of the Customs Tariff Act, 1975. Further, advance ruling has also been sought on eligibility to claim benefit of exemption under SI. No. 2 of Notification No. 24/2005-Cus dated 1-3-2005. 3.1 It is further stated in the application that (A) HP 108 is a small and compact printer which works on laser technology; it has an inbuilt memory of 64MB and works on a processor of 400 MHz; it comes with a LED display and can be connected to any computer through a high-speed USB 2.0 port; (B) HP 136 is a multi-function printer which can be used for printing, copying as well as scanning of documents; HP 136 works on laser technology for p....
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....ightly classifiable under CTI 8443 32 40 of the Customs Tariff? c. If the answer to the above questions (a) and (b) is in the negative, then, what is the appropriate classification of subject goods under the Customs Tariff? d. If the answer to question (a) is in positive, whether the applicant is eligible to claim benefit of exemption under SI. No. 2 of Notification No. 24/2005- Cus dated 1-3-2005? 3.4 The applicant also states that classification of the goods mentioned in the First Schedule of the Customs Tariff is governed by the General Rules for Interpretation (GRI, in short); the said rules for interpretation have been adopted from the General Rules for the Interpretation of the Harmonized System; as per Rule 1 of the GRI, goods under consideration should be classified in accordance with the 'terms' of the heading or the relevant Section or Chapter Notes; it further states that in the event the goods cannot be classified solely on the basis of said Rule 1, and if the headings and legal notes do not otherwise require, the remaining Rules 2 to 6 may then be applied in sequential order; Rule 1 of the GRI is extracted below for ready reference: "The titles of Sectio....
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....orted, although they were declared as LEDs, on examination, they were found to be not individual LEDs but strands of 50 LEDs each. Such strands of LEDs are used for decoration, etc. but one needs to attach the adapters and connectors to the strings of LEDs. There were no adapters in the consignment and therefore, they were incomplete. Learned adjudicating authority has correctly applied Rule 2(a) to conclude that they were classifiable as Lighting sets of a kind used for Christmas trees 94053000. The classification of the goods by the Commissioner (Appeals) needs to be set aside and the classification by the original authority needs to be restored and we do so."; reliance is also placed on the decision of Hon'ble Tribunal, Mumbai in the case of Maharaja Whiteline Industries Ltd v. Commissioner of Customs, 2019-TIOL-1797-CESTAT-MUM; in this case, the imported goods were examined, and it was found that the goods were essentially six sets of Injection Moulding Machine without clamping units; the goods had been imported in semi-knocked down condition; the Hon'ble Tribunal held that mere absence of clamping unit would not affect the classification of the goods, which were in sem....
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....dity groups, each identified by a six-digit code, arranged in a legal and logical structure and is supported by well-defined rules to achieve uniform classification; the HSN Explanatory Notes are not merely of persuasive value; instead, they are entitled to greater consideration and this proposition has been upheld in a catena of decisions: * Collector of Central Excise, Shillong v. Wood Craft Products Ltd. 1995 (77) E.L.T. 23 (S.C.); * Collector of Customs, Bombay v. Business Forms Ltd. 2002 (142) E.L.T. 18 (S.C.); * O.K. Play (India) v. Commissioner of Central Excise AIR 2005 SC 1023, 2005 (180) E.L.T. 300 (S.C.)/2005 taxmann.com 642 (SC) [3-judge bench]; * Commissioner of Customs v. Gujarat Perstorp Electronics Ltd., [2005] 7 SCC 118 2005 (186) E.L.T. 532 (S.C.)/2005 taxmann.com 1320 (SC) [3-judge bench]; * Commissioner of Central Excise v. Phil. Corpn. Ltd. 2008 (223) E.L.T. 9 (S.C.)/2008 taxmann.com 783(SC) and * Hindustan Unilever v. Commissioner of Central Excise, 2008 (228) E.L.T. 374 (CESTAT-Mad)/2008 taxmann.com 477 (Chennai - CESTAT). therefore, it is submitted that the printers proposed to be imported without formatter boards in the present case, will be cl....
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....ed under HSN Explanatory Notes to CTH 8443; the relevant portion of the HSN Explanatory Notes states, "(II) OTHER PRINTERS, COPYING MACHINES AND FACSIMILE MACHINES, WHETHER OR NOT COMBINED, this group covers: (A) Printers, this group includes apparatus for the printing of text, characters or images on print media, other than those that are described in Part (I) above., these apparatus accept data from various sources (e.g., automatic data processing machines, flatbed desktop scanners, networks); most incorporate memory to store that data, the products of this heading may create the characters or images by means such as laser, ink-jet, dot matrix or thermal print processes..."; it can be seen from the above extracted portion of HSN Explanatory Notes, that the printers having inbuilt memory, and which are used for printing of text, characters or images by means of laser technology are covered under the category of 'other printers' under CTH 8443 of the Customs Tariff; in the present case also, the applicant proposes to import Laser jet printers which comes with an inbuilt memory and will be used for printing of texts, characters etc.; therefore, the printers proposed to be im....
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....as imported condition', even in the absence of formatter board; therefore, they consider these goods to be appropriately classifiable under Sub-headings 8443 32 40, 8443 3100 and 8443 3100, respectively; furthermore, exemption from payment of Basic Customs Duty under Sl. No. 2 of Notification No. 24/2005-Cus on import of HP 136 and HP 438, is also applicable. 5.1 I have also gone through the comments of concerned Principal Commissioner/Commissioner of Customs. While commenting on the application for advance ruling, the concerned Principal Commissioner, Air Cargo, Chennai is of the view that item HP 136 and HP 438 has essential character of Multi-Function Printer without formatter board also and hence as per rule 2(a) of GRI, the said goods are classifiable under sub-heading 84433100. Whereas, the item HP 108 without formatter board also has the essential character of a Laser Jet Printer; hence as per rule 2(a) of GRI, said goods are classifiable under sub-heading 84433240. It is further stated that on import of HP 136 and HP 438, the applicant would be eligible to claim benefit of exemption under serial no. 2 (84433100) of Notification No. 24/2005-Cus. 5.2 The concerned Princ....
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....vide Notification to the subject goods are legally incorrect and deserves to be rejected; the formatter board is only a printed circuit board which is used to relay data from a computer to the printer's engine; apart from formatter board and firmware, the printer has all other components like engine, tone cartridge top level, etc; therefore, it is submitted that the printers proposed to be imported by the applicant have the essential character of complete printers; consequently, they will be classified as complete printers by applying rule 2(a) of GRI; reliance in this regard is placed on HSN Explanatory Notes to Chapter 87 of the Customs Tariff which talks about classification of incomplete vehicles; it is submitted that motor vehicles cannot function without its engine, however, the HSN Explanatory Notes still says that such motor vehicles will be classified as complete motor vehicle by applying rule 2 (a) of GRI. It is also submitted that the subject goods are not parts of copying machine and therefore cannot be classified as parts of copying machine under sub-heading 84439940 of the Customs tariff as has been incorrectly suggested in the comments by Mumbai Customs. In light....
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....n incomplete machine (i.e., an assembly of parts so far advanced that it already has the main essential features of the complete machine), ".thus a machine lacking only a flywheel, a bedplate, calender rolls, tool holders, etc., is classified in the same heading as the machine, and not in any separate heading provided for parts; similarly a machine or apparatus normally incorporating an electric motor (e.g., electro-mechanical hand tools of heading 84.67) is classified in the same heading as the corresponding complete machine even if presented without that motor". Thus applicant's inference from these Explanatory Notes that if a machine (which incorporates a motor) is imported without the motor, it can still be classified as complete machine, merits favourable consideration 10.1 In light of the foregoing, it seems that in order to issue ruling in the instant case, the moot question is as to whether or not, the items, i.e printers in question, in absence of formatter board and firmware have the essential character of a printer. To arrive at the conclusion, I intend to refer to a few judgments. In the case of Jaypee Forges v. Collector of Central Excise, Bombay reported vide 199....