2021 (10) TMI 1354 - AAR - Customs

Classification of devices - Echo Link - Link Amp - Auto - Flex - eligibility for exemption under Notification No. 57/2017-Cus., dated 30-6-2017, as amended - HELD THAT - The device Echo Link is intended to upgrade the existing stereo system of the user with high fidelity streaming music and Alexa. The use of this device would enable a user to stream his preferred sound throughout the home or chosen rooms/areas. It is important to appreciate that Echo Link is to be connected to Echo speaker (input device) as well as multiple existing speakers (output devices). The primary utility of the device is to upgrade any stereo system with high-fidelity streaming music and Alexa, control music selection, sound and playback with compatible Echo device or the Alexa app; connect to stereo (any input audio device) and group with other supported Echo devices to play music throughout the home; provide multiple digital and analog inputs and outputs compatible with existing stereo equipment. All the four Echo family devices under consideration in the present proceedings are voice command devices with multiple functions, including answering questions, playing music, reading newspaper/audio-books, providing traffic, weather and other real-time information and controlling smart devices. These devices respond to the names Alexa , Amazon , Computer or Echo as wake up words. These Echo family devices are capable of voice interaction, music playback, making to-do lists, setting alarms, etc. - these four devices merit classification under sub-heading 8517 62 90. The specifications of Echo Auto and Echo Flex, as submitted by the applicant make it clear that they are not MIMO products. In view of this, it is held that these two devices would be eligible for the said exemption. Since Echo Link and Echo Link Amp are MIMO products, they are not eligible for the subject exemption. During the hearing held on 28-9-2021, the applicant has fairly conceded that they no longer are seeking exemption in respect of these two devices. The Audio Receiver (Echo Link) having Model No. SXP16E, Audio Transceiver and Amplifier (Echo Link Amp) having Model No. K9Y29E, Media Transmission Device (Echo Auto) having Model No. BP39CN, and Echo Flex having Model No. C77A68 merit classification under sub-heading 8517 62 90 of the First Schedule to the Customs Tariff Act, 1975; and also that the devices Echo Auto and Echo Flex are eligible for exemption extended under the Notification No. 57/2017-Customs, dated 30-6-2017; as amended. Application disposed off.

Summary

Issues Involved:
1. Classification of four devices: Echo Link, Echo Link Amp, Echo Auto, and Echo Flex.
2. Eligibility for exemption under Notification No. 57/2017-Cus., dated 30-6-2017, as amended.

Issue-Wise Detailed Analysis:

1. Classification of Devices:

Echo Link (Model No. SXP16E):
The Echo Link is used for streaming high-fidelity music to any stereo system and upgrading it with Alexa. It connects to a stereo and supported Echo devices to play music throughout a home. The device is designed to receive, convert, transport, or regenerate voice, data, etc. It does not have a built-in microphone and speaker and requires connection to a receiver or amplifier for passive speakers. The ruling concluded that Echo Link merits classification under sub-heading 8517 62 90 as "other machines for the reception, conversion, and transmission of voice, images, or other data."

Echo Link Amp (Model No. K9Y29E):
Echo Link Amp performs all functions of Echo Link but includes an additional built-in amplifier. It upgrades stereo systems with high-fidelity streaming music and Alexa, and amplifies audio signals. The built-in amplifier is an additional feature, not the principal determining feature. Therefore, Echo Link Amp also falls under sub-heading 8517 62 90 as "other machines for the reception, conversion, and transmission of voice, images, or other data."

Echo Auto (Model No. BP39CN):
Echo Auto is a hands-free Alexa-enabled device for motor vehicles, connecting via Bluetooth or auxiliary input. It allows voice interaction, music playback, and other functions using data services of a connected smartphone. The device is classified under sub-heading 8517 62 90 as "other machines for the reception, conversion, and transmission of voice, images, or other data."

Echo Flex (Model No. C77A68):
Echo Flex is a plug-in, hands-free Alexa-enabled device with a USB-A port for phone charging and supporting accessories. It performs various functions such as voice interaction, music playback, and controlling smart devices. The device is classified under sub-heading 8517 62 90 as "other machines for the reception, conversion, and transmission of voice, images, or other data."

2. Eligibility for Exemption:

Echo Auto and Echo Flex:
The ruling noted that the exemption under Sr. No. 20 of Notification No. 57/2017-Cus., dated 30-6-2017, as amended, extends to goods classifiable under sub-headings 8517 62 90 and 8517 69 90, excluding MIMO devices. Since Echo Auto and Echo Flex are not MIMO products, they are eligible for the exemption.

Echo Link and Echo Link Amp:
The Echo Link and Echo Link Amp are identified as MIMO products and thus fall under the exclusions listed in the notification. Consequently, they are not eligible for the exemption. The applicant conceded during the hearing that they are no longer seeking exemption for these two devices.

Conclusion:
The ruling concluded that all four devices—Echo Link, Echo Link Amp, Echo Auto, and Echo Flex—merit classification under sub-heading 8517 62 90. Additionally, Echo Auto and Echo Flex are eligible for the exemption under Notification No. 57/2017-Cus., dated 30-6-2017, as amended, while Echo Link and Echo Link Amp are not.