2006 (7) TMI 433 - AT - Central Excise

Summary

Issues:
Classification under Notification No. 6/2002-CE for "touch screen kiosks" manufactured and supplied by the assessee. Denial of benefit leading to duty demand and penalty under Section 11AC of the Central Excise Act.

Analysis:
The issue in this case revolves around the classification of "touch screen kiosks" under Notification No. 6/2002-CE. Both the Department and the assessee agree on the classification under Heading 84.71 of the CETA Schedule. However, the dispute arises as the department did not consider the item as a 'computer' for the purpose of the notification. The notification includes an Explanation that defines 'computers' to include specific components. The assessee argued that their product satisfied the criteria as it included a CPU with monitor and keyboard cleared together as a set. Despite this, the Commissioner did not accept the plea, leading the matter to the Tribunal for resolution.

Upon examining a sample of the product and its operation, the Tribunal found that the kiosk indeed consisted of a CPU, monitor, and keyboard. The Tribunal observed that the keyboard was primarily for the operator to change programs and not for users. However, they noted that a user could operate the kiosk in the same manner as demonstrated during the hearing. Additionally, certificates from the Southern Railway and Rajiv Gandhi Shiksha Mission described the kiosks as "computers with add-on features," further supporting the assessee's position. The Tribunal also considered the presumption of correctness under the Evidence Act for certificates issued by senior officers, placing the burden of rebuttal on the disputing party, which was not the assessee in this case.

The Tribunal reviewed literature on kiosks from the "Dictionary of Computer Science," which defined a kiosk as a booth providing a computer-related service, emphasizing the use of a touch screen for user-friendly interaction. This literature supported the assessee's argument that the kiosks should be considered as computers for the purpose of the notification. After careful consideration, the Tribunal found a prima facie case in favor of the assessee, leading to a waiver of pre-deposit and a stay of recovery concerning the duty and penalty amounts.