By TIOL News Service

NEW DELHI, JAN 14, 2017: THE respondent had imported "External Hard Disk Drive" and claimed exemption from CV duty under Notification 6/2006-CE dated 01.3.2006 and later, Notification 12/2012-CX dated 17.02.2012. The dispute in the present appeal is relating to classification of imported hard disk drive and its eligibility for concessional rate of CV duty. Original assessing authority has assessed the goods under tariff heading 84717030 with effective CV duty of 12% denying the benefit of Notification No. 12/2012-CX dated 17.03.2012 (Serial No. 255). On appeal, Commissioner (Appeals), vide impugned order, allowed the appeal and set-aside the assessment orders. The impugned order held that external hard disk drives are correctly classifiable under tariff heading 84717020 of the first schedule of the Customs Tariff Act. The Revenue is in appeal against Order in Appeal dated 29.04.2014.

The Tribunal noted that the classification of external hard disk drive assumes significance because of concessional rate of duty available to only hard disk drive not to removable or exchangeable disk drives. The Revenue considers the imported items under 84717030 whereas the impugned order by the Commissioner (Appeals) held the product under heading 84717020. The later entry is eligible for concessional CV duty.

The Tribunal noted that the exemption notification specifies tariff heading up to six digits only, 847170, which covers both, hard disk drive and removable or exchangeable disk drives. Further, the next column of the table for description explains the goods only as hard disk drive among many other items. On careful consideration of the technical specification furnished, and the sample of imported items along with tariff entries and the exemption notification, Tribunal is in agreement with the findings in the impugned order. The terms hard disk drive used in the notification has not been amplified either by adding "external" or "internal". On this simple premise alone, exemption to the said item cannot be denied. Admittedly, the imported items are hard disk drive and are meant for external use with computer or lap-top as plug-in device. They are portable hard disk drive. The contention of the Revenue that they are only removable or exchangeable disk drive, is not factually or technically correct.

Tribunal perused sample of such removal or exchangeable disk drives. They have full drive mechanism in which storage media is inserted and along with such media can be removed and inserted in computer for usage. Tribunal also perused the technical literature of the manufacturer of the impugned goods. Further, the technical opinion given by the Ministry of Communication and Information Technology, is directly on the issue.

Tribunal found that in the appeal, the Revenue contested the factual findings in the impugned order. Guided by the expert opinion of the concerned Ministry and facts recorded in the impugned order, the Tribunal did not find it fit to interfere with the impugned order.

The appeal by Revenue is dismissed.

(See 2017-TIOL-125-CESTAT-DEL)