TMI Blog2023 (12) TMI 1112X X X X Extracts X X X X X X X X Extracts X X X X ..... employee who key in the PIN into the device. The device does not do anything except for collecting the data at the time of entry or exit and this data is transmitted to a central server for further processing like marking the attendance, preparation of payroll or for other purposes. These facts are not in dispute. Based on the General Rules of Interpretation and the Chapter Notes, the item needs to be classified in the heading akin to it or where the specific description is provided. In this case, the data collection device imported by the appellant is nothing but a card reader working in conjunction with the server. Thus, this device functions as proximity readers/badge readers, which are specifically classified under Chapter Heading No.8543. Since the specific function of the imported item is to mark attendance or to take note of the persons of the employees for the purpose of attendance or payroll or leave, they cannot be classified under Chapter 84 as it excludes from this Chapter as per the Chapter Note 5(E). This Tribunal, recently, in the case of COMMISSIONER OF CUSTOMS, BANGALORE VERSUS M/S. KRONOS SYSTEMS INDIA PVT. LTD. [ 2023 (10) TMI 1006 - CESTAT BANGLORE] , in an iden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e find that the capability to be freely programmed in accordance with the needs of the buyer appears to include the writing of a new or modified program by programmer or the purchase and use of software containing an existing program. The object is to introduce or alter the instructions that tell the computer what to do with the data. According to revenue a machine is freely programmable, if the user is able to modify the existing program. We find that this facility could be availed if several fixed programs are available in the machine and the user can switch to the desired program; i.e., he can choose between a number of fixed programs. Argument of the Counsel for the respondents appears to be that the device is freely programmable in this sense. 13. We observe that the original authority noted that the item is freely programmable as per the submissions of the assessee. He found that the goods did not satisfy the conditions to classify it as ADPM and the entry under CH 8437 more specifically covered the goods. He found the equipment to be not a computer as the device worked in conjunction with a server which only processed the data inputted. 14. The impugned order finds the devic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal. He submits that machines are capable of being freely programmed according to the requirement of the user and it satisfied all attributes of Automatic Data Processing Machines and is rightly classifiable under CTH 8471. He submits that the limited issue in the remand proceedings is to examine whether the impugned machine is capable of freely programmed as per the requirement of the user Note 5(A) (ii) of Chapter 84. He further submits that considering the configuration of the machines, the impugned goods cannot be classified as electrical apparatus or instrument as the heading covers only electrical appliances and apparatus with individual functions. Act, 1962. To substantiate his contentions, relied on the following case laws: STJ Electronics Pvt. Ltd. vs. CC, New Delhi: 2016 (337) ELT 140 (Tri.-Del.) Jaya Diagnostic Research Centre Ltd. vs. CC, Hyderabad: 2020 (374) ELT 273 (Tri.-Hyd.) 4. The learned Authorised Representative for the Revenue reiterated the findings of the lower authorities and relied on the following judgments to claim classification of the impugned goods under CTH 8543 7099: CC, Bangalore vs. N.I. Systems (India) P. Ltd.: 2010 (256) E.L.T. 173 (SC). C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the purposes of heading 8471, the expression ―automatic data processing machine‖ means machine capable of : (i) storing the processing programme or programmes and at least the data immediately necessary for the execution of the programme; (ii) being freely programmed in accordance with the requirements of the user; (iii) performing arithmetical computations specified by the user; and (iv) executing, without human intervention, a processing programme which requires them to modify their execution, by logical decision during the processing run. The Commissioner (A) has clearly observed in the impugned order that (as reproduced in paragraph 2 above) they are not freely programmable and hence, they get excluded from Chapter 8471. 7. From the catalogue, it is noticed that: The Item Fingerprint Time Attendance System T4 is a standalone finger print T A system, low price with good performance, specially designed in the purpose of popularizing the fingerprint products. The system has got inbuilt processing capabilities and works independently without connecting to computer or server for data processing operations. Product Features: i. This device is standalone device it can r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat: 5.1 The Department contended that CTH 8543 70 99 is more applicable due to the fact that the item imported basically operates on electrical/electric technology. We find that the Head 8543 covers electrical machines and apparatus having individual functions not specified or included elsewhere in the chapter. Therefore, the classification of the Finger Print Reader would be more appropriate under this heading. We also accept the Department s contention that when the item is prima facie classifiable under two headings in terms of Rule 3(c) of General Rules of Interpretation of Import Tariff, the goods should be classified under the heading which occurs last in numerical orders among those which equally merits consideration. We accept this contention. Going by merits as well as by the Rules of Interpretation, we hold that the impugned product merits classification under CTH 8543 70 99 as contended by the Department. 10. Similarly in the same set facts in the case of CC vs. Shakya Technologies Ltd. (supra), this Tribunal at para 5.1 has held that: 5.1 The Department contended that CTH 8543 70 99 is more applicable due to the fact that the item imported basically operates on electri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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