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of <h1>AAR Mumbai defers Echo device classification ruling citing conflicting advance rulings and pending Delhi HC appeals</h1> The AAR Mumbai deferred ruling on classification of Echo family devices (Echo 4th Gen., Echo Dot 4th Gen., Echo Dot with Clock, Echo Studio) under tariff ... Classification of goods - Echo family devices - to be classified under sub-heading 85176290 or not - Echo (4th Gen.), Model No. L4S3RE; Echo Dot (4th Gen.), Model No. B7W64E; Echo Dot (4th Gen.) with Clock, Model No. B7W644; and Echo Studio (Model No. 02T2V3) are appropriately classifiable under heading 8518 or not - HELD THAT:- The Echo family devices featuring 'Alexa' as discussed in the preceding paragraph 2 and the Apple HomePods featuring 'Siri' described in paragraph 8 are indeed near identical devices. Obviously, in the matter of classification of these two kinds of devices of different manufacturers/marketers, a difference of opinion has arisen amongst the two advance rulings authorities. And, as informed by the ld. Counsel of the applicant, the matter has already reached the first statutory appellate level, i.e., the Hon'ble High Court of Delhi. Such being the undeniable facts, I feel it would be improper on my part to create further discordance on this issue which is already sub-judice. Therefore, in my considered opinion, the issue of classification of the 15 Echo family devices, except the device 'Wireless Speaker Device, Model No. P5B83L', which is not an Echo family device, need to await the decision of the Hon'ble High Court of Delhi, which is already seized of the matter in the form of the appeals of M/s. Amazon Wholesale India Pvt. Ltd. Reliance placed upon the judgment of the Hon'ble High Court of Bombay in the case of TITANOR COMPONENTS LTD. VERSUS COMMISSIONER OF INCOME TAX [2009 (4) TMI 67 - BOMBAY HIGH COURT], wherein it was held that if a similar appeal is pending before the Hon'ble High Court, it would have been proper for the Tribunal to wait till the question of law is adjudicated by the Hon'ble High Court in the appeals pending before it - The ratio of the above judgment was followed by the Larger bench of the CESTAT, Mumbai in the case of C. PINTO VERSUS COMMISSIONER OF CUSTOMS, MUMBAI [2018 (2) TMI 336 - CESTAT MUMBAI]. Further, the Larger Bench of CESTAT, New Delhi in the case of DINKAR KHINDRIA VERSUS COLLECTOR OF CUSTOMS, NEW DELHI [2000 (3) TMI 76 - CEGAT, NEW DELHI] has also held that Judicial propriety require that a co-ordinate bench should not sit over judgment on the order recorded by another bench. Accordingly, the secretariat is directed to keep track of the progress of the appeals of M/s. Amazon Wholesale India Pvt. Ltd. against the rulings of the CAAR, New Delhi and place these 10 applications for decision as soon as the Hon'ble Delhi High Court decides the appeals of M/s. Amazon Wholesale India Pvt. Ltd. The ruling in respect of 'Wireless Speaker Device, Model No. P5B83L', shall, however, be rendered without awaiting the decision of the Hon'ble Delhi High Court as it is not an Echo family device. Issues Involved:1. Classification of various Echo devices.2. Eligibility for exemption under Notification No. 57/2017-Cus.3. Maintainability of applications in light of pending appeals.4. Comparison with rulings on similar devices (Apple HomePod).Detailed Analysis:1. Classification of Various Echo Devices:The applicant sought advance rulings on the classification of multiple Echo devices. The devices in question include Echo Portable Smart Speaker, Echo Show 10, Echo (4th Gen.), Echo Dot (4th Gen.), Echo Dot (4th Gen.) with Clock, Echo Studio, Echo Dot (3rd Gen.) with Clock, Echo (3rd Gen.), Echo Show 8, Echo Spot, and Echo Show 5. The applicant argued that these devices should be classified under sub-heading 85176290, asserting that these are communication devices with multiple functionalities involving voice commands and Alexa technology.The Customs Authority for Advance Rulings (CAAR), New Delhi, had previously ruled that several of these devices belong under headings 8518 and 8528, classifying them as sound reproducing speakers or viewing screens. The applicant has challenged these rulings before the Hon’ble High Court of Delhi.2. Eligibility for Exemption Under Notification No. 57/2017-Cus:The applicant also sought rulings on the eligibility for exemption under Sr. No. 20 of Notification No. 57/2017-Cus for the Echo devices. Different customs authorities provided varied opinions on the classification and eligibility for exemption. For instance, Chennai Sea Port suggested classification under sub-heading 85198990 for Echo Portable Smart Speaker, while Air Cargo Complex, Mumbai, suggested sub-heading 85176290 but denied the benefit of the exemption notification.3. Maintainability of Applications in Light of Pending Appeals:The applicant contended that the applications before CAAR, Mumbai, should be maintainable despite pending appeals in the Hon’ble Delhi High Court. They argued that the applicant in the previous rulings (Amazon Wholesale India Pvt. Ltd.) and the current applicant (Amazon Seller Services Pvt. Ltd.) are distinct legal entities. This distinction means the proviso (a) to section 28-I(2) of the Customs Act, which bars applications if the issue is pending in the applicant's case, does not apply. This argument was supported by the Gujarat High Court's judgment in GSPL India Transco Limited, which held that different legal entities should not be conflated for the purpose of pending issues.4. Comparison with Rulings on Similar Devices (Apple HomePod):The applicant drew parallels between the Echo devices and Apple HomePods, classified under sub-heading 85176290 by CAAR, Mumbai. Both types of devices feature digital assistants (Alexa and Siri, respectively) and perform similar functions, such as streaming music, providing real-time information, and controlling smart devices. The applicant emphasized that the Echo devices should similarly be classified under sub-heading 85176290, arguing that the speakers and monitors are not central to the devices' primary function of processing and transmitting voice commands.Conclusion:The CAAR, Mumbai, acknowledged the similarity between Echo devices and Apple HomePods but decided to await the decision of the Hon’ble Delhi High Court on the appeals filed by Amazon Wholesale India Pvt. Ltd. regarding the classification of Echo devices. The ruling for the Wireless Speaker Device, Model No. P5B83L, which is not an Echo family device, will be rendered without awaiting the High Court's decision. The secretariat is directed to monitor the progress of the appeals and revisit the 10 applications once the High Court decides the matter.
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