2015 (10) TMI 2258 - AT - Customs

Classification of Liquid Crystal Devices (LCDs) - Appellants sought classification of LCD under Heading 90138010 and states that LCDs are outside the scope of Section XVI of Customs Tariff Schedule which covers Chapter 84 and 85 only - Revenue classified them under CTH 852990.90 on grounds that these are parts suitable for use solely or principally with LCD TV of CTH 8528 and Note 2 of Section XVI gets attracted. Held That - LCDs are specifically mentioned in CTH 9013 as it has LCDs by name while description of CTH 85.29 is general in nature - Section Note is of no avail as Note (1) (m) of Section XVI clearly states that Section XVI does not cover articles of Chapter 90 - Decision given in case of M/s Secure Meters Ltd. Vs. CC, New Delhi 2015 (5) TMI 241 - SUPREME COURT followed wherein parts suitable for use solely or principally with LCD TV were stated not to cover LCDs for LCD TVs as specifically as description of CTH 9013 covers LCDs by name and devotes a sub heading (90138010) exclusively for it Decided in favour of assessee.

Issues Involved:
Classification of Liquid Crystal Devices (LCDs) imported by the appellants.

Detailed Analysis:

1. Classification Dispute:
The primary issue in these appeals is the classification of Liquid Crystal Devices (LCDs) imported by the appellants. The appellants sought classification under Heading 90138010, while the Revenue classified them under CTH 852990.90, arguing that these are parts suitable for use solely or principally with LCD TVs of CTH 8528.

2. Appellants' Contentions:
(i) LCDs are specifically covered under CTH 901380 and cannot be classified under CTH 8529, which contains a general description and does not mention LCDs by name.
(ii) Note 1 (m) to Section XVI of the Customs Tariff Schedule excludes articles of Chapter 90, thus placing LCDs outside the scope of Chapters 84 and 85.
(iii) In the case of Videocon Industries Ltd. Vs. CCE - 2009 (92) RLT 383, LCDs were classified under CTH 9013, not under CTH 8529.
(iv) The adjudicating authority's reliance on the CESTAT decision in M/s Secure Meters Ltd. Vs. CC, New Delhi - 2004 (169) ELT 63 (Tri.-Del.) was misplaced as the Supreme Court later classified LCDs for energy meters under CTH 9013.
(v) The Revenue's reliance on Regulation (EU) No. 1202/2011 is misplaced because the EU's sub-heading CTH 8529 90 differs from the Indian Customs Tariff Schedule.

3. Revenue's Contentions:
(a) CTH 9013 excludes LCDs provided for more specifically in other headings, and since these LCDs are parts of LCD televisions, they fall under 85.29.
(b) The Supreme Court judgment in Secure Meters Ltd. is not directly applicable as it dealt with LCDs for energy meters under Chapter 90, whereas the present case involves Note 2 of Section XVI.
(c) Identical goods have been classified under 8529 by the European Union.
(d) The Videocon judgment is not applicable as the goods in that case were liquid crystal panels, whereas the present goods are LCD modules with additional components, making them more suitable for classification under CTH 8529.

4. Tribunal's Analysis:
The Tribunal noted that the imported goods are not merely liquid crystal panels but include additional components such as driver, circuit, backlight unit, circuitry PCB, and inverter, all housed in a metal casing, referred to as 'LCD modules' by the Revenue. The Tribunal agreed that the goods are indeed liquid crystal devices (LCDs).

5. Classification Under CTH 9013 vs. CTH 8529:
The relevant parts of CTH 9013, 8528, and 8529 were examined. CTH 9013 specifically mentions liquid crystal devices (LCDs). The Tribunal concluded that CTH 9013 would cover the LCDs unless it can be demonstrated that they are more specifically provided for in other headings. The Tribunal found that while LCDs are parts suitable for use with LCD TVs under CTH 8528, the description in CTH 9013 is more specific as it exclusively covers LCDs.

6. Section Note 2(b) of Section XVI:
The Tribunal noted that Section Note 2(b) of Section XVI, which deals with the classification of parts of certain machines, is not applicable to Chapter 90. Note 1 (m) of Section XVI clearly states that Section XVI does not cover articles of Chapter 90. Therefore, the impugned LCDs, being more specifically covered under 9013 80 10, would be classified under CTH 9013 rather than CTH 8529.

7. Supreme Court Judgment in Secure Meters Ltd.:
The Tribunal referred to the Supreme Court judgment in Secure Meters Ltd., which classified LCDs for energy meters under CTH 9013. The Tribunal found that the Supreme Court's reasoning applied mutatis mutandis to the present case, reinforcing that CTH 9013 covers LCDs more specifically than CTH 8529.

8. European Union Classification:
The Tribunal noted that while decisions of other Customs administrations can be a useful guide, they are not binding on Indian Customs. The Tribunal also observed that the EU's classification for LCD modules under 8529909215 does not exist in the Indian Customs Tariff.

Conclusion:
In light of the analysis, the Tribunal held that the impugned LCDs are classifiable under 90138010 and allowed the appeals.

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