1999 (12) TMI 524 - AT - Customs

Summary

Issues: Classification of Xerox Document Centre DCS 230ST as a printer under sub-heading 8471.60 or under sub-heading 8479.89.

Analysis:
1. Classification Dispute: The main issue in this appeal is the classification of the Xerox Document Centre DCS 230ST as a printer under sub-heading 8471.60 or under sub-heading 8479.89. The Appellant, represented by Shri R. Parthasarathy, argued that the product is a Digital Laser Printer with additional features like a Scanner and inbuilt modem for fax transmission/reception, making it a multifunction product. He contended that the digital printing function is the principal one, classifying it under sub-heading 8471.60. The Counsel emphasized that Note 5B to Chapter 84 does not apply in this case, and referred to General Notes (E) of HSN under Chapter 84 to support the classification. Additionally, the Counsel pointed out that a similar machine was classified as a printer under 8471.60 by U.S. Customs.

2. Counter-Argument: On the other hand, Shri S. Ramanathan, representing the Respondent, argued that the Xerox Document Centre DCS 230ST is a multifunction machine not dependent on Automatic Data Processing (ADP) systems. He contended that the machine can function as a standalone digital copier and should be classified under Heading 84.79 for machines with individual functions. Ramanathan highlighted that the machine's principal function is digital printing, which is not classifiable under a specific heading, thus supporting classification under Heading 84.79.

3. Customs Tariff Headings: The Customs Tariff headings 84.71, 8471.60, 8479.80, and 8479.89 were examined to determine the appropriate classification. The Appellants claimed that the Xerox Document Centre DCS 230ST is designed as a laser printer to connect to a network of ADP machines, falling under sub-heading 8471.60. They referenced Explanatory Notes of HSN and Note 5(D) to Chapter 84 to support their classification argument based on connectivity and data processing capabilities.

4. Adjudication and Decision: The Assistant Commissioner initially classified the product under a residuary heading as it was not exclusively dependent on an ADP machine and could function independently. However, the Tribunal observed that Note 5(D) applies in this case, not Note 5(B), and noted that the product is primarily used in an ADP system. Therefore, the Tribunal allowed the appeal, classifying the Xerox Document Centre DCS 230ST under sub-heading 8471.60 as a printer connected to an ADP system, based on its digital printing function and connectivity to ADP networks.

In conclusion, the Tribunal's decision favored the Appellants' argument, highlighting the machine's connectivity to ADP systems and its principal function as a digital printer, leading to its classification under sub-heading 8471.60 of the Customs Tariff Act.