Composite sale classification: battery charger bundled with a mobile phone falls under the concessional cell phone entry.

A battery charger supplied with a cellular telephone in a composite retail package, without any separate charge, was classified under the concessional entry for cellular telephones and parts thereof. The court treated the charger as part of the composite sale because it was necessary for use of the phone, had insignificant standalone value, and was not independently sold in the package. Physical non-affixation did not make it a separately taxable accessory. The classification therefore followed the principal goods and their parts, and the issue was resolved in favour of the assessee.

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Issues: Whether a battery charger sold in a composite package with a cellular telephone, without any separate charge, was includible in the concessional entry for cellular telephone and parts thereof, so as to attract the lower rate of tax.

Analysis: The entry governing cellular telephones covered not only the main product but also parts thereof. The charger was supplied along with the phone as part of the retail package, its value was insignificant in comparison with the phone, and the phone could not be used without it. On these facts, the charger was not to be treated as a separately taxable accessory merely because it was not physically affixed to the phone. The concept of composite goods and the dominant or essential character of the package supported classification by reference to the cell phone entry. The authorities relied upon for separate taxation concerned goods sold independently or situations where the component was not shown to form part of a composite sale without extra charge.

Conclusion: The battery charger formed part of the composite sale of the cellular telephone and was covered by the concessional entry applicable to cell phones and parts thereof. The issue was answered in favour of the assessee and against the Revenue.

Ratio Decidendi: Where an item is sold as part of a composite retail package with the principal goods, is necessary for their use, and does not have an independent separate charge, it may be classified with the principal goods under the entry covering the goods and their parts.

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