2007 (8) TMI 189 - AT - Customs

Exemption Not. 6/2006 All items falling under heading 847170 are eligible for the benefit and there is no exclusion to goods falling under sub-headings 84717020 or 84717090 Hard Disk Drive and Hard Disk Drive in array cannot be treated different while allowing benefit of exemption

Summary

Issues: Classification of imported item under CTH, eligibility for benefit of Notification No. 6/2006-C.Ex, Revenue's contention on classification, interpretation of Notification, validity of Commissioner's decision.

Classification of Imported Item under CTH:
The appeal involved a dispute regarding the classification of an imported item described as "Storage devices - Hard Disk" under Bill of Entry No. 146446 dated 10-4-2006. The Order-in-Appeal held that the item was rightly classified under CTH No. 84717020 and eligible for the benefit of Notification No. 6/2006-C.Ex. The appellants argued that they were eligible for exemption under Notification No. 6/2006-CE as the imported item was a hard disk drive. The Tribunal agreed with the appellants, stating that the goods imported were exempted from duty under the notification, and thus, the order passed by the lower adjudicating authority was set aside.

Eligibility for Benefit of Notification No. 6/2006-C.Ex:
The appellants claimed exemption under Notification No. 6/2006-CE, dated 1-3-2006, asserting that the imported item, a hard disk drive, fell under the exemption category. The Tribunal found that the impugned goods were imported duty-free under the notification, and the appellants were indeed eligible for claiming the exemption. Consequently, the order passed by the Assistant Commissioner was set aside, and the appeal was allowed with consequential relief.

Revenue's Contention on Classification:
The Revenue argued that the imported item was an Array of Hard Disk, which should be classified under Residuary Sub Heading No. 87717090, not under the benefit category for Hard Disk Drives. They contended that the benefit had been wrongly granted by the Commissioner (A) for the Hard Disk Drive, emphasizing the distinction between a Hard Disk Drive and a 'Storage Disk Array'.

Interpretation of Notification:
The learned JDR referred to Board's Circular No. 105/2003, highlighting that the circular did not specifically pertain to the item in question but only mentioned storage disk array. However, the Counsel argued that the Tariff Heading specified in the notification covered items falling under 847170 or 847330, with Hard Disk Drive mentioned in Column 3-(c). The Counsel emphasized that all items falling under 847170 were eligible for the benefit, with no exclusion for sub-headings 84717020 or 84717090.

Validity of Commissioner's Decision:
Upon careful consideration of the notification, the Tribunal noted that goods falling under 847170 were entitled to the benefit, without any differentiation based on sub-headings like 84717020 or 84717090. As the item in question was a Hard Disk Drive, the Tribunal concluded that the mere fact that the drive was imported in an array did not disentitle it from classification under Heading 347170, regardless of the subheading. Consequently, the Tribunal deemed the Commissioner's decision legal and proper, rejecting the appeal by the Revenue.