TaxTMI 
TaxTMI 
2023 (1) TMI 700
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....71 30 10', which was later confirmed by the Assistant Commissioner of Customs and Commissioner of Customs (Appeal). These findings were further affirmed by the Customs, Excise and Service Tax Appellate Tribunal (hereinafter, 'CESTAT'), West Zonal Bench, Mumbai vide the impugned judgments dated 19.12.2018 and 24.06.2019. 3. While the rate of duty is same under both the Tariff Items, the method of computing them is different. Goods under 'Tariff Item 8471 30 10' attract the application of Section 4A of Central Excise Act, 1944, which valued the excisable goods on the basis of percentage of retail sale price. In contrast, a classification under 'Tariff Item 8471 50 00' invites valuation based on price mechanism under Section 4 of Central Excise Act, 1944 which would have effectively reduced the overall liability to pay the requisite duty. This difference in liability is the precise reason behind the present dispute regarding classification under the correct Tariff Item which calls for adjudication. 4. Before delving into the reasoning of the revenue authorities and CESTAT, which is more or less identical, it would be appropriate to reproduce the following relevant parts of the F....
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....it whether or not combined 8471 41 10 Micro computer 8471 41 20 Large or main frame computer 8471 41 90 Other 8471 49 00 Other, presented in the form of systems 8471 50 00 Processing units other than those of subheading 8471 41 or 8471 49, whether or not containing in the same housing one or two of the following types of unit: storage units, input units, output units (Emphasis Applied) 5. Since, the reasoning confirming the classification under 'Tariff Item 8471 30 10' by the adjudicating authorities including CESTAT is identical, hence, it would be sufficient to discuss the key findings of the impugned decisions in brevity. These observations are : a) The Concerned Goods weighed less than 10 kilogram and were easily carried from one place to another. In this respect the CESTAT relied on dictionary meaning of the word 'portable' to hold that the goods were rightly classified under 'Tariff Item 8471 30 10"; b) The absence of inbuilt power source does not render the Concerned Goods as nonportable; c) The dimensions of the Concerned Goods as well as the fact that it was not foldable did not impact the element of portabilit....
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....fore and appreciate the efforts of learned counsel for the Appellants who physically demonstrated by setting up one of the sample units of the Concerned Goods to showcase the aspects of portability involved in present matter. 8. On the contrary, Mr. Arjit Prasad, learned senior counsel for the Respondent while supporting the observations in the impugned decisions, put forth two counter arguments. Firstly, that since the word 'portable' is nowhere defined in the statute, it should be interpreted on the principle of general parlance. In other words, he submitted that the dictionary meaning of the word 'portable' is sufficient to resolve the dispute regarding its interpretation. Secondly, he maintained that the legislature's intention was crystal clear in qualifying the term 'portable' by providing the condition in the description that any ADP less than 10Kgs would automatically become portable. In furtherance of this argument, he relied on the Constitution Bench decision of this Court in Mathuram Agrawal v State of MP Mathuram Agrawal v State of MP (1999) 8 SCC 667, para 12 to urge that the intention of the legislature has to be discerned from the plain and unambiguous meaning of ....
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....g without an external source of electric power and often have a modem or other means for establishing a link with a network." (Emphasis Applied) 12. While it appears well settled that the HSN is to be normally taken as a safe guide for classifying goods under the First Schedule because it is based on an internationally recognized 'harmonized nomenclature' Collector of Central Excise, Shillong v Wood Craft Products Limited (1995) 3 SCC 454 , a bare reading of the explanatory note applicable to the subheading clearly lays out the fact that there is no mandatory condition for being operable without any external source of power. We are thus unable to agree with the Appellants that only ADPs with a built-in power source is necessarily required to be classified under 'Tariff Item 8471 30 10'. In other words, no element of 'functionality' is contemplated for the purpose of classifying the Concerned Goods as 'portable'. 13. The second aspect deals with the question as to whether mere factum of weighing less than 10 kilograms would be sufficient to classify the Concerned Goods as 'portable' or not. In this respect, it may be seen that the CESTAT vide its impugned order(s) has....
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....trade meaning is one which is prevalent in that particular trade where the goods is known or traded. If special type of goods is subject-matter of a fiscal entry then that entry must be understood in the context of that particular trade, bearing in mind that particular word. Where, however, there is no evidence either way then the definition given and the meaning following (sic flowing) from particular statute at particular time would be the decisive test." ibid, para 10 (Emphasis Applied) 17. In our considered opinion, the word 'portable' should have been interpreted in the context of ADPs. In this regard, relevant technical and commercial literature has been perused by us. On a minute analysis thereof, we deem it appropriate to extract the following relevant material: The Institute of Electrical and Electronics Engineers defines 'portable computer' as " A personal computer that is designed and configured to permit transportation as a piece of handheld luggage" The Institute of Electrical and Electronics Engineers, IEEE Standard Computer Dictionary (1990) 155 The Dictionary of Computer and Internet Terms defines it as " able to be carried around....
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....age protection. An example of the same would be the availability of protection cases which allows users to carry the ADPs in hand or possibility of carrying the same in normal briefcases or shoulder bags. 19. On applying these core ingredients to the characteristics of Concerned Goods, there is no room to doubt that they are not 'portable'. Firstly, the dimensions of the Concerned Goods make it illogical and unviable for daily transit. While it is true that classification of the goods must not be usually made on the advertisement material of the manufacturer, the user guides produced before us showcase that placing the product in other than the specified orientation could lead to damage to the Concerned Goods. The user guides also emphatically highlight that the Concerned Goods were meant to be used at a fixed place and contained specifications that made them ideal for being mounted on a wall. 20. Secondly, the inability of the consumer to carry these goods around in the absence of any protective case or any covering bags, which makes the Concerned Goods vulnerable to damage during transit. As noted in the literature relied upon before us, the weight was not the sole consider....