ORDER
T.K. Jayaraman, Member (T)
1. This is an appeal by Revenue, against the order-in-appeal No. 121/2002-Cus., dated 18-12-2002, passed by the Commissioner of Customs (Appeals), Bangalore.
2. This issue relates to the classification of modules (Main Switching Centre Hardware Upgrades) imported by the respondents. The original authority classified the goods under 8517.90 as Parts’. However, Revenue held the view that the goods should be classified under 8517.80 as ‘Other apparatus’. The Commissioner (Appeals) rejected Revenue’s appeal with the following observations.
“To be classified as apparatus, the goods must have a separate identifiable function on its own. These being components going into switching centers, cannot be treated as other apparatus. The Deputy Commissioner Customs has in his order pointed out that the main switching center is a complete machine with a provision for expansion of the switching capacity. The impugned imported goods called modules are basically inserted as essential parts into the main switching center to enhance the capacity for which a provision is always made. These modules therefore do not have any independent function, and cannot be treated as an ‘Apparatus’. I find merit in the argument of the Deputy Commissioner of Customs. I therefore find that given the facts of the case, the impugned goods called modules are more appropriately classified as ‘Parts’ under 8517.90 rather than ast ‘Other Apparatus’ falling under 8517.80. I therefore uphold the order of the Deputy Commissioner of Customs (Air Cargo Complex) and reject the Departmental Appeal.”
3. Shri R.V. Ramakrishnappa, the learned JDR, appeared for the Revenue who is the appellant and Ms. Rukmani Menon, the learned advocate appeared for the respondent.
4. The learned advocate for the respondent stated that the original authority has dealt with elaborately on the issue before coming to a conclusion. Our attention was brought to the decision in Indchem Electronics Ltd. v. CC, Chennai – 1997 (95) E.L.T. 580 (Tribunal), wherein it has been held that Add-on Cards and Mother Boards, which are capable of use only when linked up with certain other components, cannot be classified as automatic data processing machines but parts of machines falling under 84.71 of Central Excise Tariff Act, 1985. On the same analogy the impugned goods, which are in the nature of complete set of PCBs, are only Parts and cannot be treated as Other Apparatus.
5. The learned JDR reiterated the grounds of appeal. According to the grounds of appeal the impugned goods are described as Mobile Telephone Equipment in the invoice. The various kinds of modules imported are meant for functions such as receiving, transmission, message distribution, group processing and line interface, programme execution, input/output processing, signalling, etc.
6. We have gone through the rival submissions. We find that the Main Switching Center consists of various modules in the form of PCBs. Each module will have its own function. The modules are all of standard format. There is a face plate on the front of each module with display elements, with controls and access to front connectors. The PCBs of the modules are of multi layer design and the components with which they are equipped are mainly surface mounted devices. The Main Switching Center is a machine with the provision for expansion. The modules are inserted as essential parts to attain a particular capacity. The modules on their own do not have any independent function and they cannot be dis-assembled further. Even though the numbers of modules are variable depending on capacity, each module remains as a part of the main machine, i.e. Main Switching Center. In view of the above, the Original Authority’s finding that the modules cannot be considered as apparatus is correct. Hence there is no infirmity in the Order-in-Appeal confirming the Original order. Therefore the appeal of the Revenue is devoid of any merit. Hence we reject Revenue’s appeals.
