Classification by intrinsic character controls customs treatment; conditional exemption and OGL benefit were denied for the imported computer.

Imported goods must be classified on their intrinsic character as imported, not by the importer's claimed end use. On that basis, the Maccanofilm Programme Computer was classified under Heading 84.51/55 rather than Heading 84.40. The conditional exemption under Notification No. 179/80-Cus. was unavailable because its benefit extended only to goods satisfying the heading-specific eligibility requirements for parts used in initial setting up, assembly or manufacture, subject to customs satisfaction. The claim for clearance under OGL also failed because the goods were treated as electronic equipment/system within the relevant prohibited entry.

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Issues: (i) Whether the imported Maccanofilm Programme Computer was classifiable under Heading 84.51/55 or under Heading 84.40 of the First Schedule to the Customs Tariff Act, 1975. (ii) Whether the importer was entitled to the benefit of Notification No. 179/80-Cus. dated 04-09-1980 and clearance under OGL.

Issue (i): Whether the imported Maccanofilm Programme Computer was classifiable under Heading 84.51/55 or under Heading 84.40 of the First Schedule to the Customs Tariff Act, 1975.

Analysis: The imported item was described as one unit of Maccanofilm Programme Computer. The applicable tariff note treated automatic data processing machines and units thereof broadly, including analogue and micro-processor based systems, and classified separate units under the same heading. The end-use claimed by the importer did not control classification, and the goods had to be classified on their own character as imported.

Conclusion: The imported goods were correctly classified under Heading 84.51/55 and not under Heading 84.40.

Issue (ii): Whether the importer was entitled to the benefit of Notification No. 179/80-Cus. dated 04-09-1980 and clearance under OGL.

Analysis: The exemption under Notification No. 179/80-Cus. was conditional and applied only to parts required for initial setting up, assembly, or manufacture of goods falling under the specified headings, subject to satisfaction of the customs authority. Since the goods were not classifiable under Heading 84.40, the notification did not apply. The claim to OGL also failed because the goods were treated as electronic equipment/system covered by the relevant prohibited entry, and the prior clearance history did not alter the legal position.

Conclusion: The importer was not entitled to the benefit of Notification No. 179/80-Cus. or to clearance under OGL.

Final Conclusion: The appeal failed on the merits, the departmental classification and denial of exemption were sustained, and the import was held to be outside the claimed OGL entitlement.

Ratio Decidendi: Classification of imported goods must be determined by their intrinsic character as imported, and a conditional exemption notification applies only when the goods satisfy the heading-specific eligibility conditions and the prescribed customs satisfaction requirement.

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