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TMI Blog2009 (2) TMI 814X X X X Extracts X X X X X X X X Extracts X X X X ..... recovered from them. The show cause notice was adjudicated by the Dy. Commissioner after remand from Commissioner (A) in the first round of proceedings and he classified the goods under Chapter Heading 8529.9090 finalized assessment and ordered for recovery of differential amount of duty. This order was uphled by the Commissioner (A). 2. Ld. Advocate for the appellants submitted that the goods under question were LCD panels having multi use in televisions and computer monitors etc. and are specifically covered under Chapter Heading 9013.8010 which is specific heading relating to Liquid Crystal Device (LCD). He referred to the HSN Explanatory Notes relating to tariff heading 90.13 in which liquid crystal devices have been described as consisting of liquid crystal layer sandwiched between two sheets or plates of glass or plastics, whether or not inted with electrical connections, presented in the piece or cut to special shapes and not constituting articles described more specifically in other headings. The entry referred to by the revenue i.e. Chapter Heading 8529 relates to parts of television and parts cannot be considered as a specific heading. Parts cannot constitute articles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred over a heading covering parts. If note 2 to Section XVI were to exclude pats, which are goods specified in headings of Chapter 84 and 85, then heading 85.29 would not exclude lend from the purview of heading 85.29. This proposition is by HSN Explanatory Notes to heading relating to parts. which are goods specified in other chapters other than Chapter 84 and 85. The goods specified under Chapter Heading 90 like measuring or checking apparatus (90.31), revolution counters and production counters (90.29) and brushes for mounting on machines of heading (96.03) are specifically exclude from Chapter Heading 84.66. Similarly, HSN Explanatory Notes to heading 84.31 exclude parts which are goods specified in other chapters other than chapter 84 and 85. So is the case with heading 84.73 and 85.22. This makes it clear that any heading referring to parts excludes goods of chapters other than Chapter 84 and 85, since such goods are covered specifically in the headings of other chapters and not necessarily of Chapter 84 and 85. It has been a consistent New of the courts that when the goods are described specifically in heading, then such goods even if they are parts of specific machines ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... D and TFT had been held to be classifiable under heading 90.13. These rulings related to imports to US from Japan. The US customs administration, after noting that, in the condition in which the LCD-TFT's have been imported in to USA, could be used either for manufacture of TVs or for manufacture of computer monitors held them classifiable under heading 90.13. According to US customs administration, between heading 90.13 are 85.29, heading 85.29 is residuary and does not cover the bare LDC-TFTs. These reasoning are contained in Sharp Microelectronics Technologies, INC vs The United States. Untied States Court of Appeal, Federal circuit, 122F, 3D 1446 dated 2.9.1997 and HQ 1209 dated 2.6.2007. 6. Ld. DR, in his written submission has submitted that it is settled that before proceedings for classification of an entity, it is absolutely essential to determine, what is the entity under classification dispute. After such determination, a suitable heading or sub-heading in the tariff is to be located and then the same has to be considered, in light of Statutory Rules for interpretation, the Section Notes and the Chapter Notes in the Tariff to establish whether the proposed heading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he test of commercial identity and not the functional test. It needs to be ascertained as to how the goods in question were referred to in the market by those who deal with them, be it for the purposes of selling, purchasing or otherwise The court referred to Notes 2(b) and (3) of Section XVII and observed that a joint reading of the notes would show that the expression parts of general use throughout the schedule, means, inter alis, articles of Heading No. 73.18 and similar articles of other base metal; and expression 'part and accessories' in Chapter Heading 87.08 does not apply to parts or accessories which are not suitable for use solely or primarily with articles of Chapter Heading 87.08 which pertains to parts and accessories of motor vehicles of Chapter Heading 87.01 to 87.05. For the purpose of classification under Chapter Heading 87.08, the test to be applied is: whether the goods are suitable for use solely or primarily with articles of Chapter Heading Nos. 870.1 to 87.05; if the answer is in the affirmative, the goods will be classifiable under Chapter Heading 87.08, but if the answer is in the negative, they would have to be classified under Chapter Heading NO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the parts of LCD TVs will not be classifiable under Chapter Heading 85.29 if it is specifically specified under any other chapter heading (in this case Chapter Heading 90.13), support cannot be drawn from some notes relating to other sections and chapters. 10. In view of the above it was submitted that the Commisioner (Appeals) order is correct and requires no interference. 11. We have considered the submissions. We find that the whole issue revolves around the interpretation of the phrase 'liquid crystal device not consisting articles provided for more specifically in other heading' occurring in Chapter Heading 90.13. While the appellants case is that the disputed goods are admittedly liquid crystal device, they are specifically covered by the entry heading 90.13 as it is not described more specifically in any other heading. The entry referred to by the revenue i.e. Chapter Heading 8529 relates to parts suitable for use solely or principally with the parts of heading nos. 85.25 to 85.28 which interalia includes LCD TV, cannot be considered as a specific heading. We find that the revenue has laid a great emphasis on the fact that the LCD panels in question are speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd 3 itself says: 2. The expression 'parts' and 'parts' and accessories' do not apply to the following articles, whether or not they are identifiable as for the goods of this section: (a) xxx xxx (b) Parts of general use, as defined in Note 2 to Section XV, of base metal (Section XV), or similar goods plastics (Chapter 39) 3. References in Chapters 86 to 88 to 'parts' or 'accessories' do not apply to parts or accessories which are not suitable for use solely or principally with the articles of those Chapters. A part of accessory which answers to a description in two or more of the headings of those Chapters is to be classified under that heading which corresponds to the principal use of that part of accessory. 12. The above section notes itself provides that the word parts and accessories will not apply to parts of general use as defined in Note 2 to Section XV of base metal and it was in view of this note that the Apex Court held that parts which are suitable for use solely or principally with articles of Chapters 86 to 88 ar to be treated as parts and accessories of articles falling under Chapter 86 to 88 as per Note 3. These ..... X X X X Extracts X X X X X X X X Extracts X X X X
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