Follow Us :

Case Law Details

Case Name : In re Supertron Electronics Pvt. Ltd (CAAR Delhi)
Appeal Number : Order No. CAAR/Del/Supertron/06/2023
Date of Judgement/Order : 09/03/2023
Related Assessment Year :
Courts : CAAR

In re Supertron Electronics Pvt. Ltd (CAAR Delhi)

It is evident that the projectors in question are designed for use with an automatic data processing machine. It also appears that the subject goods has got additional ports which may make it capable of being a video projector, classifiable under 85286900. In this regard, it may be mentioned that rule 3 of General Rules for Interpretation of Import Tariff states that, “the heading which provides the most specific description shall be preferred to headings providing a more general description”. The applicant has declared that the projectors are designed to function in places like conference rooms, business meetings, financial institutions, etc., with connectors matching that of PC, indoor or outdoor projection capability. Form the above description, it is clear that these projectors are principally meant for use with an automatic data processing system. Further, as regards applicability of exemption notification, it is noted that under SI. No. 17 of Notification No. 24/2005 dated 01.03.2005, as amended, all goods of a kind solely or principally used in an automatic data processing system of heading 8471, falling under Sub-heading 852842, 852852 or 852862 are given exemption.

Thus, I am of the view that projectors in question are machines working in conjunction with an automatic data processing machine and performing a specific function other than data processing, thus the same merit classification in the headings appropriate to their respective function i.e 85286200. Moreover, subject goods are eligible for exemption from duties vide SI. No. 17 of Notification No. 24/2005 dated 01.03.2005 as amended.

FULL TEXT OF THE ORDER OF CUSTOMS AUTHORITY OF ADVANCE RULING, DELHI

M/s. Supertron Electronics Pvt. Ltd., “Supertron House”, No. 2, Cooper Lane, Kolkata-700001, having IEC No. 0295000473 and PAN-AADCS5971L (applicant, in short) has filed an application dated 11.11.2022, received in this office on 20.12.2022, seeking advance ruling under section 28-H of the Customs Act, 1962 before the Customs Authority for Advance Rulings, New Delhi (CAAR, New Delhi in short). The application was accordingly registered under Serial No. 30/2022 dated 20.12.2022.

2. The applicant, vide the aforesaid application, has sought ruling on the question of classification of the proposed item of import namely, Data Projector Model (i) ZH 350, (ii) ZW 350e & (iii) ZX 350e, (subject goods, in short) and eligibility of exemption from duties vide Serial No.17 of the exemption Notification No. 24/2005 dated 01.03.2005, as amended by Notification No.67/2016 dated 31.12.2016.

3. The applicant intends to import subject goods from China It is stated in the application for advance ruling (application, in short) that the subject goods are data projectors used in schools, business meetings, and conferences, and are principally meant for use with an automatic data processing system; subject goods are designed to function in places like conference rooms, business meetings, financial institutions, etc., with connectors matching that of PC and with indoor or outdoor projection capability. The applicant is of the view that the subject goods are classifiable under Subheading 85286200 of the Customs Tariff and they intend to claim exemption from Customs duty vide Notification No. 24/2005 dated 01.03.2005 (SI. No.17, as inserted by Notification No.67/2016 dated 31.12.2016.. Accordingly, the applicant raised the question for issue of a ruling on classification of the subject goods under Subheading 85286200 and eligibility for exemption from duty vide Serial No. 17 of the Notification No. 24/2005 dated 01.03.2005 as amended.

4.1 The applicant has also stated in the application that the subject goods are data Projectors, which are designed primarily to be used with an automatic data processing system, having additional features of HDMI port, S-Video port, etc.; Sub-heading 85286200 clearly mentions that only projectors which are capable of connecting to and designed for use with an automatic data processing system of heading 8471 shall be classified under the said Sub-heading; therefore, subject goods merit classification under Sub-heading 85286200. The applicant has further stated that, data projectors models ZH 350, ZX 350e & ZW 350e have a native resolution of 1920*1080 (HD), 1024*768(XGA) & 1280*800 (WXGA) respectively; it is relevant to note that the resolution of home theatre projectors or video projectors is 4K UHD (3840*2160); therefore, it is apparent that the projectors in question are not of a kind to be used as home theatre projectors or video projectors, even going by the resolution output; the contrast ratio of the projector in consideration is 30,000:1, whereas, the contrast ratio of home theatre/video projectors is in the range of 1,00,000:1 and 12,00,000:1; in addition, the native aspect ratio of the home theatre/video projectors is 16:9, whereas the native aspect ratio of the products in question is 4:3. The applicant has also placed reliance on the decision in Epson India Pvt. Ltd. v. Commissioner reported in 2019 (366) ELT 847 (Tri-Chennai) stating that in the afore-said decision, the Hon’ble Tribunal, Chennai, had held that the projectors which are principally used for data projection by being connected to either a laptop or a desktop computer shall be eligible to be classified under CTH 8528 6100 (erstwhile tariff heading for projectors capable of directly connecting to and designed for use with an automatic data processing system of heading 8471); the said decision has already been confirmed by the Hon’ble Supreme Court in Commissioner of Customs v. M/s. Epson India Pvt. Ltd. reported in 2019 (366) ELT A173 (SC).

4.2 It is also stated that the Hon’ble Tribunal, Mumbai, has held, in Commissioner of Customs v. Vardhaman Technology Pvt. Ltd., reported in 2014 (301) ELT 427, that the presence of video port, S-video port, HDMI, RCA etc. in the data projectors were insignificant, for the purpose of classification, when the primary function is to project data by connecting to an Automatic Data Processing System; in addition, the afore-said decision has been followed by the Hon’ble Tribunal, New Delhi, in M/s. Casio India Co. Pvt. Ltd. v. Commissioner of Customs, New Delhi, vide Final order dated 55283/2016; the Hon’ble Authority, vide Ruling No. CAAR/Mum/ARC/70/2021 dated 20.12.2021 has ruled that the projector is classifiable under Cm 8528 6200 and is eligible to avail benefit vide Serial No. 17 of Notification No. 24/2005-Cus dated 01.03.2005; the said Ruling is squarely applicable to the present case; a similar view was taken by the Authority in its Ruling No. CAAR/Mum/ARC/63/2021 dated 28.10.2021; from the above decisions of the Hon’ble CESTAT, some of which have been affirmed by the Hon’ble Supreme Court and from the Advance Ruling mentioned above, it is apparent that the classification of color data projector has attained finality and there is no room for any doubt with regard to the fact that the goods are classifiable under 8528 6200 and are entitled to avail the benefit of Serial No. 17 of Notification No. 24/2005 dated 01.03.2005

5. Comments in the matter have been received from the concerned Commissioner of Customs, Import Commissionerate, Chennai wherein, it is stated inter-alia that as per the technical specifications submitted by the applicant w.r.t. both rulings issued by CAAR, Mumbai in respect of M/s. Audio Distribution House Pvt. Ltd. and Ruling of CAAR, New Delhi in respect of M/s Supertron Electronocs Pvt. Ltd. on classification of data projector, it is noted that the specifications clarifies that the goods are meant for connecting to ADPs; the features of data projector (product in consideration) such as native aspect ratio, native resolution etc. are differentiating them to video projectors (85286900); hence the subject goods, data projectors which are capable of connecting to an automatic data processing system are classifiable under Sub-heading 85286200 and would be eligible to avail benefit of Serial Number 17 of Notification No. 24/2005 dated 01.03.2005, as amended, as proposed by the applicant.

6. Accordingly, personal hearing, in the matter was held on 21.02.2023 in the virtual mode. The advocate explained the goods for which ruling has been sought; he referred to the application for advance rulings, where detailed write-up in respect of goods in question has already been given; he also referred to various technical features of the goods in question to emphasize that these data projectors are primarily designed to function with ADP machine, moreover goods in question are data projector and not video/movie projector. The advocate invited attention to rulings of CAAR, Mumbai in respect of the applicant, M/s Audio Distribution House Pvt. Ltd. for the similar products. He also stressed upon the point that the goods in question are working with ADP machine and the same cannot function without ADP machine. These goods are mainly meant for studying, schooling etc. and not meant for use as a movie projector. Advocate then requested to consider the specification of the product, ruling issued by CAAR, Mumbai and issue ruling treating goods as data projector. The departmental representative re-iterated the submissions as given in the comments of the concerned Commissioner on the application for advance ruling. He also mentioned that the projectors in question work with ADP machine.

7. Finding that the application is valid in terms of the provisions of the Customs Act and the CAAR Regulations, 2021, having heard the applicant, and recognizing the importance of timely pronouncement of rulings, I proceed to examine the question on merits.

8. Since the question under the application for advance ruling relates to classification of goods proposed to be imported, guidance of the Harmonized Commodity Description and Coding System of the World Customs Organization, to which India is a signatory, would be useful. It is seen that as per Explanatory Notes of Chapter 85, Seventh edition (2022), in heading 8528 of Harmonized Commodity Description and Coding System, projectors are classified. It further states that projectors may be capable of receiving a variety of signals from different sources; however, if they incorporate a television tuner they are considered to be reception apparatus for television. I also note that the said explanatory notes while explaining monitors capable of directly connecting to and designed for use with an automatic data processing machine of heading 8471 has mentioned inter-alia that monitors of this group include monitors fitted with connectors characteristic of data processing system (e.g., RS-232C interface, DIN, D-SUB, VGA, DVI, HDMI or DP (display port) connectors). Further, as regards monitors other than those capable of directly connecting to and designed for use with an automatic data processing machine of heading 8471, it is explained inter-alia that they are not fitted with connectors characteristics of data processing systems. Though such detailed explanation has not been given in the said explanatory notes as regards, `Projectors’. However, it is felt that orderly and systematic reading of the explanatory notes, would make the above explanation applicable in respect of projectors also, meaning thereby that projectors classifiable under 85286900 would also not be fitted with connectors characteristics of data processing system. However, as per technical features stated in the leaftlets of the subject goods, computer compatibility features and input/output connections mentioned therein indicate that subject goods are fitted with connectors characteristics of data processing system. Thus, the subject goods do not merit classification under Sub-heading 85286900.

9. I also note that the applicant vide their declaration in the application for advance ruling has stated that projectors in question are not of a kind used as home theatre projectors or video projectors, even going by the resolution output. Further, under Subheading 85286200, projectors which are capable of directly connecting to and designed for use with an automatic data processing system of 8471, merit classification therein. Therefore, reference is drawn to Chapter Note of Chapter 84 of the Customs Tariff. Chapter Note 6(C) of Chapter 84 lays down conditions for a unit to be regarded as being part of an automatic data processing system. Further, under Note 6 (D) (v), it provides that projectors, not incorporating television reception apparatus are not covered under heading 8471 when presented separately, even if they meet all of the conditions of Nore 6 (C). Moreover, Note 6 (E) of Chapter 84 lays down that machines incorporating or working in conjunction with an automatic data processing machine and performing a specific function other than data processing are to be classified in the headings appropriate to their respective functions or, failing that, in residual headings. Subheading 85286200 classify projectors capable of directly connecting to and designed for use with an automatic data processing machine of heading 8471.

10. Further, I have also observed that CAAR Mumbai has issued Ruling No CAAR/Mum/ARC/04/2023 dated 02.02.2023 wherein, it is ruled that the data projectors (Model-ZH 350, ZW350e and ZX 350e) are classifiable under Sub-heading 85286200 of the First Schedule of the Customs Tariff Act, 1975 and would be eligible to avail benefit of Sr. No. 17 of Notification No. 24/2005 dated 01.03.2005, as amended.

11. Keeping in view the foregoing, it is evident that the projectors in question are designed for use with an automatic data processing machine. It also appears that the subject goods has got additional ports which may make it capable of being a video projector, classifiable under 85286900. In this regard, it may be mentioned that rule 3 of General Rules for Interpretation of Import Tariff states that, “the heading which provides the most specific description shall be preferred to headings providing a more general description”. The applicant has declared that the projectors are designed to function in places like conference rooms, business meetings, financial institutions, etc., with connectors matching that of PC, indoor or outdoor projection capability. Form the above description, it is clear that these projectors are principally meant for use with an automatic data processing system. Further, as regards applicability of exemption notification, it is noted that under SI. No. 17 of Notification No. 24/2005 dated 01.03.2005, as amended, all goods of a kind solely or principally used in an automatic data processing system of heading 8471, falling under Sub-heading 852842, 852852 or 852862 are given exemption.

12. Thus, I am of the view that projectors in question are machines working in conjunction with an automatic data processing machine and performing a specific function other than data processing, thus the same merit classification in the headings appropriate to their respective function i.e 85286200. Moreover, subject goods are eligible for exemption from duties vide SI. No. 17 of Notification No. 24/2005 dated 01.03.2005 as amended.

13. I rule accordingly.

Join Taxguru’s Network for Latest updates on Income Tax, GST, Company Law, Corporate Laws and other related subjects.

Leave a Comment

Your email address will not be published. Required fields are marked *

Search Post by Date
May 2024
M T W T F S S
 12345
6789101112
13141516171819
20212223242526
2728293031