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1999 (1) TMI 272 - AT - Central Excise
Issues: Classification of Time-recording System under Tariff Entries 8471.00 and 91.06
Issue 1: Classification under Tariff Entry 8471.00 The Collector (Appeals) classified the product under sub-heading 91.06, while the Revenue argued for classification under sub-heading 8471.00, contending that the system is a part of a complete computer system. The Revenue emphasized that the product is a microprocessor system designed for use as part of a computer system, capable of processing and generating various reports. However, the Company Representative argued that the system functions independently to record entry and exit times without processing data, and can be connected to a personal computer for data retrieval. The Representative asserted that the product's specific function of time recording aligns with the description under Heading 91.06, which covers time data recording apparatus. Issue 2: Interpretation of Note 5(b) of Chapter 84 The Revenue relied on Note 5(b) of Chapter 84 to argue that the product does not fall under the exclusion clause, as it has multiple applications and can be part of a complete system. However, upon scrutiny, it was found that the product only records data without processing it for reports, requiring a connection to a personal computer for further analysis. The Tribunal noted that the product's functionality aligns more with the description under Heading 91.06, which involves measuring, recording, or indicating intervals of time, rather than automatic data processing machines covered under Heading 8471.00. Judgment After analyzing the technical literature and relevant tariff entries, the Tribunal upheld the order of the Collector (Appeals) and rejected the Revenue's appeal. It was concluded that the time-recording system, primarily recording entry and exit times without processing data for reports, was correctly classified under sub-heading 91.06. The Tribunal emphasized that the product's nature as a time recorder, distinct from a microprocessor system, and its reliance on a personal computer for data analysis supported its classification under Heading 91.06. The decision highlighted the importance of aligning the product's function with the appropriate tariff entry for accurate classification.
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