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2023 (6) TMI 652 - AAR - CustomsClassification of the proposed items of import - Optoma Creative Touch 3-series Interactive Flat Panel (IFP) - to be classified under Sub-heading 84714190 or under sub-heading 85285900? - HELD THAT - On perusal of the comments of the concerned Commissionerate on the application for advance ruling, it is observed that the word, 'Display' in the description of item, 'Interactive Flat Panel Display; has caught their attention and same has been made basis to arrive at essential/principal function of the subject goods however, it appears that importance of the word, Interactive in the description of the subject goods, has not been discussed much. The word, Interactive, in the description of the subject goods immediately brings to the front various capabilities of the subject goods and on closer examination, the capabilities of the subject goods meet the requirement under Chapter Note 6 (A) of Chapter 84 for a machine to mean as 'automatic data processing machine'. Moreover, once an item has inbuilt input unit, output unit along with processing unit then it is obvious that the item is capable of performing multiple functions - For such an item similar to the subject goods, the issue is to ascertain essential function and terms of the heading read with Section/Chapter Notes for determination of classification of such goods. In light of the foregoing, the issue of classification, in the instant application gets settled in terms of Rule 1 and Rule 6 of General Rules for Interpretation of Import Tariff (GRI) without inviting reference to Rule 3 of GRI. It is also noted that Customs Authority for Advance Rulings, Mumbai examined the question of classification of similar goods and ruled for classification of such goods similar to the subject goods in Sub-heading 84714190, in an appeal filed by M/s Ingram Micro India Pvt. Ltd. 2022 (2) TMI 308 - CESTAT NEW DELHI . Thus, it is evident that the proposed items of import namely, Optoma Creative Touch 3-series Interactive Flat Panel (IFP) (Model- 3652RK, 3752RK 3862RK) merit classification under Sub-heading 84714190 of the First Schedule to Customs Tariff Act, 1975.
Issues Involved:
1. Classification of the proposed items of import: "Optoma Creative Touch 3-series Interactive Flat Panel (IFP) (Model- 3652RK, 3752RK & 3862RK)." Issue-wise Comprehensive Details: 1. Classification of the Proposed Items of Import: - The applicant, M/s. Supertron Electronics Pvt. Ltd., sought an advance ruling on the classification of "Optoma Creative Touch 3-series Interactive Flat Panel (IFP) (Model- 3652RK, 3752RK & 3862RK)" under Sub-heading 84714190. - The applicant argued that the subject goods are an All-in-One (AIO) computer system with an inbuilt motherboard, dual-core A52 Micro Processor (CPU), Quad-core A55, graphics card, 4GB RAM, and 32 GB ROM, and an embedded Android system pre-loaded with Android 11.0 OS. They emphasized that the goods meet all the conditions of Note 5(A) of the Chapter Notes, qualifying them as Automatic Data Processing (ADP) machines. - The applicant referenced similar classifications in the United States and previous rulings by CAAR, Mumbai, which classified similar products under Sub-heading 84714190. 2. Comments from the Department: - The Commissioner of Customs, Chennai, argued that the subject goods are primarily display devices with additional features for interaction through display, mainly used for training, conferences, and educational purposes. They suggested classification under Sub-heading 85285900, as the primary function is to display data/images/pictures/videos. - The Commissioner referred to Supreme Court judgments and CESTAT rulings to support their argument that the goods should be classified based on their primary function of display. 3. Personal Hearing and Additional Submissions: - During the personal hearing, the applicant reiterated their stance, citing Chapter Notes of Chapter 84 and previous rulings by CAAR, Mumbai, for similar items. - The applicant contended that the goods have an in-built CPU and are not merely display devices. They argued that the large size of the display is a feature, not its principal function, and the goods should be classified as ADP machines under CTH 8471. 4. Examination of the Question on Merits: - The Customs Authority for Advance Rulings, New Delhi, noted that similar items had been classified under Sub-heading 84714190 by CAAR, Mumbai, and other international rulings. - The authority emphasized the importance of the term "Interactive" in the description of the goods, indicating various capabilities that meet the requirements of an ADP machine under Chapter Note 6(A) of Chapter 84. - The authority concluded that the essential function of the goods is not merely display but includes data processing capabilities, thus meriting classification under Sub-heading 84714190. 5. Final Ruling: - The proposed items of import, "Optoma Creative Touch 3-series Interactive Flat Panel (IFP) (Model- 3652RK, 3752RK & 3862RK)," are classified under Sub-heading 84714190 of the First Schedule to the Customs Tariff Act, 1975. Conclusion: - The ruling concluded that the subject goods qualify as Automatic Data Processing machines and are correctly classifiable under Sub-heading 84714190.
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