2021 (1) TMI 623 - AT - Customs

Classification of imported goods - LCD panels and parts of LCD panels - Department contends that both these items would fall under CTH 8529 9090 whereas the appellant contends that LCD panels would fall under CTH 9013 8010 and parts of LCD panels would fall under CTH 9013 9010 - period of dispute is from January 2018 to February 2018 and February 2018 to February 2019 - HELD THAT - The very same issue came up for consideration before the Tribunal in the case of M/S SAMSUNG INDIA ELECTRONICS PVT LTD, M/S MOSER BAER INDIA LTD VERSUS COMMISSIONER OF CUSTOMS, NOIDA 2015 (10) TMI 2258 - CESTAT NEW DELHI . The competing classification with regard to Liquid Crystal Devices (LCDs) imported was CTH 9013 8010 as against CTH 8529 9090. The Department was of the view that the goods will fall under CTH 8529 by relying on Section Note 2(b) of Section XVI of the Customs Tariff Schedule. The Tribunal held that the goods would fall under CTH 9013 8010 and relied upon the decision of the Hon'ble Apex Court in the case of M/S. SECURE METERS LTD. VERSUS COMMISSIONER OF CUSTOMS, NEW DELHI 2015 (5) TMI 241 - SUPREME COURT . LCD panels are classifiable under CTH 9013 8010 and parts of LCD panels are classifiable under CTH 9013 9010 - the classifications are to be under CTH 9013 8010 and CTH 9013 9010, the denial of exemption benefit to the appellant as per amendment Notification No. 92/2017-Cus. dated 14.12.2017 is without any factual or legal basis and requires to be set aside. Appeal allowed - decided in favor of appellant.

Issues Involved:

1. Classification of LCD panels.
2. Classification of parts of LCD panels.
3. Applicability of Customs Tariff Headings (CTH) 8529 and 9013.
4. Impact of amendment Notification No. 92/2017-Cus. dated 14.12.2017 on classification and duty rates.
5. Interpretation of Section and Chapter Notes in Customs Tariff.
6. Relevance of judicial precedents in determining classification.

Detailed Analysis:

1. Classification of LCD Panels:

The primary issue is whether LCD panels should be classified under CTH 8529 or CTH 9013. The appellant argued that LCD panels should be classified under Tariff Item 9013 8010, which specifically covers Liquid Crystal Devices (LCDs). The Department contended that LCD panels should be classified under CTH 8529, as they are parts suitable for use solely or principally with television sets, which fall under CTH 8528.

The Tribunal noted that CTH 9013 specifically mentions "Liquid Crystal Devices" by name and provides a more specific description than CTH 8529, which is a residuary entry. Therefore, the Tribunal concluded that LCD panels are correctly classifiable under CTH 9013 8010.

2. Classification of Parts of LCD Panels:

Similarly, for parts of LCD panels, the appellant argued for classification under Tariff Item 9013 9010, while the Department insisted on CTH 8529 9090. The Tribunal reiterated that parts of LCD panels should follow the classification of the main product, which in this case is LCD panels under CTH 9013. Thus, parts of LCD panels are classifiable under CTH 9013 9010.

3. Applicability of Customs Tariff Headings (CTH) 8529 and 9013:

The Tribunal examined the relevant headings and notes. CTH 8529 covers parts suitable for use solely or principally with apparatus of headings 8525 to 8528, while CTH 9013 covers Liquid Crystal Devices not constituting articles provided for more specifically in other headings. The Tribunal found that CTH 9013 provides a more specific description for LCD panels and parts thereof.

4. Impact of Amendment Notification No. 92/2017-Cus. dated 14.12.2017:

The Department argued that the appellant changed the classification to CTH 9013 to benefit from the lower duty rate after the amendment increased the duty on goods under CTH 8529. The Tribunal dismissed this argument, stating that there is no estoppel in taxation and classification should be based on the correct tariff heading, not on the duty rate.

5. Interpretation of Section and Chapter Notes in Customs Tariff:

The Tribunal referred to Section Note 1(m) of Section XVI, which excludes articles of Chapter 90 from Chapters 84 and 85. It also considered Note 2(a) of Section XVI, which states that parts included in any heading of Chapter 84 or 85 should be classified in their respective headings. The Tribunal concluded that since LCD panels are specifically mentioned in CTH 9013, they should be classified there and not under the more general CTH 8529.

6. Relevance of Judicial Precedents:

The Tribunal relied on previous judicial decisions, including the Supreme Court's ruling in M/s. Secure Meters Ltd. v. Commissioner of Customs, New Delhi, which classified LCD panels used in electricity meters under CTH 9013. The Tribunal also cited its own decisions in M/s. Samsung India Electronics P. Ltd. and M/s. Videocon Industries Ltd., which supported classification under CTH 9013.

Conclusion:

The Tribunal held that LCD panels are classifiable under CTH 9013 8010 and parts of LCD panels under CTH 9013 9010. It set aside the impugned orders and allowed the appeals with consequential reliefs, emphasizing that the classification should follow the specific description provided in the tariff headings and supported by judicial precedents.

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