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2016 (2) TMI 141 - AT - CustomsClassification - import of MSO CBM (EMBALLE PAR 40) FINGER PRINT READER SCANNER - classifiable under Customs Tariff heading 8543 or under CTH 8471 - Held that - It is clear that the impugned item is of a kind solely or principally used in an automatic data processing system, it is connectable to the central processing unit and is able to accept or deliver data in a form (codes or signals) which can be used by the system. The exclusions contained in chapter note 5(D) do not cover the impugned item. In the present case the machine essentially performs data processing function inasmuch as it processes the data relating to fingerprint with the finger print data in the motherboard / Centre processing unit (CPU). Thus, it does not have any specific function other than data processing. The impugned goods are therefore not eased out of CTH 8471 by the provisions of Chapter notes 5(D) & 5(E) CTH 85.43 covers electrical machines and apparatus having individual functions, not specified or included elsewhere in chapter 85. Thus, this heading is a sort of residuary heading for the goods otherwise covered under chapter 85. As the impugned goods are found to be covered under CTH 8471 as per above analysis, they are obviously out of chapter 85 and hence out of CTH 85.43 too. The impugned goods are classifiable under CTH 8471 - Decided in favor of assessee.
Issues: Classification of imported goods under Customs Tariff headings 8471 or 8543.
Analysis: 1. Contentions of the Appellant: The appellant argued that the imported goods, namely MSO CBM (EMBALLE PAR 40) FINGER PRINT READER SCANNER, should be classified under Customs Tariff Heading (CTH) 8471 as optical readers. They provided evidence from the manufacturer's pamphlet describing the goods as high-performance optical sensors working on proprietary optical technology to read fingerprints and transmit data to computers or motherboards for matching. The goods were stated to function as input units to a system using optical technology, and similar classification was observed in other Custom Houses in India. 2. Contentions of the Respondent: The Departmental Representative (DR) contended that the goods were parts of electrical machines and apparatus with individual functions not specified elsewhere in Chapter 85. Reference was made to Chapter Note 5(E) to Chapter 84 to support this argument. 3. Judicial Analysis: The Tribunal examined the classification of the goods under CTH 8471 and CTH 8543. The description of CTH 8471 included automatic data processing machines and optical readers, while CTH 8543 covered electrical machines with individual functions not specified elsewhere. The Tribunal reviewed the technical specifications of the imported goods, which were fingerprint readers based on optical technology. The goods met the conditions outlined in Chapter Note 5(C) to Chapter 84, indicating they were part of an automatic data processing system and should be classified under CTH 8471. The exclusions in Chapter Note 5(D) did not apply to the goods, and Chapter Note 5(E) referred to machines performing functions other than data processing, which was not the case for the imported goods. Hence, the goods were not excluded from CTH 8471. As a result, the Tribunal concluded that the imported goods fell under CTH 8471 and not CTH 8543. 4. Decision: Based on the analysis, the Tribunal held that the imported goods should be classified under CTH 8471 as optical readers. The fact that other Customs Houses had also classified the goods similarly supported this classification. Therefore, the Tribunal set aside the previous order and allowed the appeal in favor of the appellant.
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