TaxTMI 
TaxTMI 
1996 (3) TMI 211
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....he products Modem, Cartridge Tape Drive (CTD) and Passive Hubs, used with the Data Processing Machines. Data Modem and Fax Modem were classified by the TVS under Heading No. 84.71 of the Schedule to the Central Excise Tariff Act, 1985 (hereinafter referred to as the 'Tariff'), and were classified by the Revenue under Heading No. 85.17 of the Tariff. CTD were classified by TVS under Heading No. 84.71 of the Tariff and were classified by the Revenue under Heading No. 84.73 of the Tariff. Passive Hubs were classified by TVS under Heading No. 84.71 and were classified by the Revenue under Heading No. 84.73 of the Tariff. In the show cause notice dated 26-3-1992 issued by the Collector of Central Excise, Bangalore, the extended period of limitat....
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....hat as per HSN Explanatory Notes, Fax Modem and Data Modem were excluded from the Heading No. 84.71. CTD were also excluded as per Chapter Note 5 of Chapter 84 from Heading No. 84.71. They performed specific functions and is in the nature of parallel back-up facility. On limitation, the ld. SDR referred to the show cause notice and the Order-in-Original and submitted that the appellants had misrepresented. In support of his arguments, the ld. SDR relied upon the Hon'ble Supreme Court's decision in the case of CCE v. Fuse Base Eltoto Ltd. - 1993 (67) E.L.T. 30 (SC). 6.  We have carefully considered the matter and have given our due thought and consideration to the submissions made by both the sides. 7. First, we would take up....
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....ary Classification List No. 4/89 at page 73 of the Paper Book No. II as under :- "Computers process data which are in the digital binary format. This data cannot be sent to another computer located in a different location through telephone lines. The signal is modulated and transmitted in the analog form, which is accepted by telephone lines. The signal received is demodulated and given to the computer in the digital format, which it understands. Data Modem is the short form of Modulator and Demodulator." Fax Modem was described at page 74 of the paper book as an alternative to conventional telex communication. Through Fax modem documents, letters, drawings, pictures or any other image could be sent over telephone lines to fax machine....
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....unctions failing that in residual headings. It has been specifically mentioned at page 1301 of vol. 3 of the HSN Explanatory Notes under Heading No. 84.71 that "Modulator and Demodulator, apparatus (Modems) which modulate in transmittable form over a Telephone Network Information obtained from an Automatic Data Processing Machine and re-convert it into digital form", are excluded from Heading No. 84.71 and they are classifiable under Heading No. 85.17 which covers "electrical apparatus for line telephony or line telephony including such apparatus for carrier current line system." It is explained at page 1363 of Vol. IV of the Explanatory Notes that apparatus of the group of `special apparatus for carrier-current line systems' "consists in t....
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....of the Data. It is not an additional storage units. It is packed and despatched separately and had to be configured with PCS and mini computers. The product literature on record provides that it is an accessory suitable for use with the PCS and fits into the space next to the monitor. 15. The Revenue had proposed the classification under Heading No. 84.73 which covered "parts and accessories (other than covers, carrying cases and the like) suitable for use solely or principally with machines of Heading Nos. 84.69 to 84.72." Heading No. 84.73 specifically covers accessories of the machines of Heading No. 84.71. It has been explained that for the purposes of Heading No. 84.73 the term accessories covers only those articles which are d....
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.... had not been furnished and he had held that with regard to the products - Modems and CTD the extended period of limitation had been rightly invoked. The appellants had contended that it is a matter involving classification dispute and that there was no suppression and that they rightly considered that all their products were classifiable under Heading No. 84.71 of the Tarrif. They have also referred to the earlier show cause notices issued on 26-10-1990, 27-2-1991, 26-8-1991 and 29-1-1992 wherein the duty had been demanded for the period from 1-3-1990 to 31-12-1991. The last show cause notice was issued by the Asstt. Collector on 29-1-1992 while in the present case the show cause notice had been issued on 26-3-1992 for the earlier period n....