1999 (5) TMI 112 - AT - Customs

Summary

Issues involved:
Classification of imported items under Tariff Sub-heading 8543.89 as "electrical machines and apparatus" vs. Chapter Heading 84.71 as "automatic data processing machines and units thereof."

Analysis:

1. Classification of Imported Items:
The issue in this appeal pertains to the classification of imported items, specifically the Fiery XJ + 300 System and Fiery XJ + 170 System. The impugned order classified these items under Tariff Sub-heading 8543.89 as "electrical machines and apparatus" instead of the appellant's claim for classification under Chapter Heading 84.71 as "automatic data processing machines and units thereof."

2. Appellant's Arguments:
During the appeal, the appellant's learned Advocate, Shri V. Lakshmikumaran, contended that the items in question are servers that operate in conjunction with digital photo copiers and computers. He explained that the servers receive data from computers, process it using microprocessors, and transfer the processed data for printing through a digital copier. The appellant argued that these servers fall under Heading 84.71, specifically meeting the requirements under Chapter Note 5, which classifies separate units under this heading.

3. Revenue Authority's Position:
The Revenue Authorities, represented by Shri Panchatcharam, maintained the classification under Tariff Sub-heading 8543.89, asserting that the servers were not solely or primarily used in automatic data processing machines due to their connection with photo copiers. They argued that the servers converted the copier into a printer rather than assisting in data processing.

4. Tribunal's Decision:
After reviewing the submissions and records, the Tribunal concluded that the Fiery XJ Systems function as servers in a data processing system involving computers and photo copiers. The Tribunal found that these machines receive, store, and transmit data between computers and copiers as per programmed sequences, making them integral units in an automatic data processing system. Citing Chapter Note 5, the Tribunal held that the correct classification for the Fiery XJ systems is under Heading 84.71, not under sub-heading 8543.89. Consequently, the appeal was allowed, the impugned order was set aside, and relief was granted to the appellants.