Classification by Principal Use: DVRs engineered for Hawk aircraft treated as aircraft parts, overturning prior reclassification.

Whether imported DVRs are classifiable as aircraft parts or as video recorders turned on application of the suitability/principal-use test in Section notes to Chapters 85-88 and HSN Explanatory Notes; tribunal accepted factual finding that the DVRs were specifically engineered to interface with Hawk avionics and could not function as standalone commercial recorders, applied the principal-use approach consistent with higher-bench precedent and General Rule principles, and concluded the DVRs fall under the aircraft parts heading (CTH 88033000), setting aside reclassification to video apparatus.

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Issues: Whether the Digital Video Recorders (DVR) imported for use in Hawk military aircraft are classifiable as parts of aircraft under CTH 88033000 or as video recording apparatus under CTH 85219090.

Analysis: The Tribunal examined Section notes to Chapters 85-88, specifically Note 2(f) and Note 3 to Section XVII, the HSN Explanatory Notes and relevant precedents including the three Judge Bench decision in Westinghouse Saxby Farmer Ltd. The factual finding that the DVRs are specifically engineered for Hawk aircraft, interface with onboard avionics and cannot function as standalone commercial video recorders was treated as undisputed. Applying the suitability/sole or principal use test in Note 3, the Tribunal held that parts suitable for use solely or principally with articles of Chapters 86-88 cannot be excluded by Note 2(f) which lists articles that are generally excluded; where a part answers to descriptions in more than one heading, classification must follow principal use. The Tribunal found that General Rule 3(a) and the HSN notes must be applied consistent with the higher bench precedent which favours classification as aircraft parts when sole or principal use is established.

Conclusion: The imported DVRs are classifiable under CTH 88033000 as parts of aeroplanes or helicopters. The impugned order reclassifying the goods under CTH 85219090 is set aside and the appeal is allowed, with consequential relief as per law.

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