2004 (4) TMI 400 - AT - Customs

Summary

Issues:
1. Classification of LED displays under Customs Tariff Act.
2. Whether LED displays are parts of electric sound or visual signalling apparatus.

Analysis:

Issue 1: Classification of LED displays under Customs Tariff Act:
The appeal concerns the classification of LED displays imported by the appellant. The Commissioner (Appeals) held that the LED displays fall under Chapter Heading 85.42 as micro assemblies, not under Chapter sub-heading 8530.90 as parts of electric sound or visual signalling apparatus. The Commissioner considered various technical aspects and expert opinions to support this classification. The Department of Electrical Communication Engineering provided a certificate clarifying that 7 segment, 16 segment, and Dot Matrix LEDs are electronic microassemblies, supporting the classification under Heading 85.42. The Explanatory Notes highlighted that microassemblies are made from discrete active or passive components, which align with the LED displays' structure. The Commissioner emphasized that the LED displays are electronic microassemblies, as per Note 5 of Chapter 85, taking precedence over other headings based on function. Therefore, the appeal on the classification issue was disposed of in favor of the appellant.

Issue 2: LED displays as parts of electric sound or visual signalling apparatus:
The Revenue contended that the LED displays should be classified as parts of display panels for electronic equipment under Heading 8531.20. However, the Commissioner, based on expert opinions and technical analysis, determined that the LED displays are electronic microassemblies falling under Heading 8542. The Commissioner emphasized that for classification purposes, Headings 8541 and 8542 take precedence over other headings based on function. The experts clarified that the LED displays are discrete active devices and are not parts of electric sound or visual signalling apparatus like bells or alarms. The Commissioner highlighted that the LED displays' function as microassemblies aligns with the classification under Heading 8542, rejecting the Revenue's argument. Therefore, the Commissioner's decision was deemed legal and appropriate, and the appeal on this issue was rejected.

In conclusion, the judgment clarified the classification of LED displays under the Customs Tariff Act, establishing them as electronic microassemblies under Heading 8542. The decision was supported by technical opinions and expert analysis, overriding the Revenue's contentions regarding the LED displays' classification as parts of electric sound or visual signalling apparatus.