Custom
TRT-2025-
New Delhi High Court
Date:-11-12-23
In:-
Issue Favourable to Tax Payer ?:-
Order Date – 11 December 2023
Parties: Amazon Wholesale India Private Limited Vs Customs Authority of Advance Ruling, New Delhi & Anr.
Key Pointers –
- The Petitioner, Amazon Wholesale India Private Limited, claims that its 11 devices fall in the category of “Echo Family Devices” essentially communication devices with an inbuilt speaker. The appellant asserts that the devices in question are correctly classifiable under CTH 8517 and more particularly Tariff Entry 8517 62 90 thereof.
- The issue involved here is whether the subject devices were liable to be placed in CTH 8517 or under CTH 8518 or under CTH 8528
- The Divisional Bench of Hon’ble High Court observed that merely because the appellant or others had chosen to describe the products assmart speakers, the same could have neither been accepted as being conclusive of the issue that arose nor could the description of the products detracted from the right of the appellant to urge the AAR to examine the issue of classification by applying the dominant function test.
- Further, the tests evolved by courts in connection with the issue of classification such as nomenclature, common parlance, principal function, primary and incidental purpose are all aids and rules of guidance liable to be cumulatively borne in consideration in order to ascertain the true character of a product.
- It is manifest that the devices were not mere speakers. They were essentially designed to act as mediums of communication, transmitting voice, image or data and performing myriad functions in a wired or wireless environment. The playback ability of those devices could not have justifiably been recognised as being their primary or dominant function.
- As is evident from the explanation of the unique features of the products in question, they were principally designed to act as mediums for reception and transmission of data and could additionally and as an aside also be used as a speaker. However, since these were essentially reception and transmission devices which could analyze data and perform the varied functions noticed above, they were rightly described by the appellant as being communication devices and thus answering the requirement of machines for the reception, conversion and transmission or regeneration of voice, images or other data as contemplated under Tariff Entry 8517 62 90.
- Hence the impugned devices perform a host of functions including reception, conversion and transmission of voice or other data to produce the requisite final output warranting their classification under CTH 8517. merely because these devices could if so chosen by the user also be used as mere speakers, the same would not justify recognising their primordial attribute to be that of a speaker alone.
- Thus, it was held that the eleven devices are correctly classifiable under CTH 8517 and more particularly under Tariff Entry 8517 62 90. Echo Show 5, Echo Dot 4th Generation and Echo Dot 4th Generation with Clock are held eligible to claim exemptions in accordance with SI. No. 20 of the Notification dated 30 June 2017, as amended vide Notification dated 01 February 2021.
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