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PCT Committee classifies goods declared as LCD/LED panels

PCT Committee classifies goods declared as LCD/LED panels

KARACHI: The PCT Committee of the Model Customs Collectorate of Appraisement-East has concluded that the items declared as LCD/LED panels in retail packing are appropriately classifiable under PCT sub-heading 8528.7212 in terms of rule 2(a) to the General Rules for Interpretation.

According to details, the Model Customs Collectorate of Appraisement-West Karachi had forwarded a case to the PCT Committee vide letter dated September 22, 2014 pertaining to import of consignment declared to contain LCD/LED Display Panels under PCT Heading 8529.9090 as parts suitable for use solely or principally with the apparatus of heading 85.25 to 85.28.

On physical examination of the representative samples however, the goods are found as having essential character of LED TV and as such cannot be classified as parts. Instead, keeping in view provisions of rule 2(a) of GIR, the goods are found to be correctly classifiable under PCT heading 8528.7212 as complete or finished television sets.

Upon disagreement by the importers with the ascertained classification, matter was referred to a committee of three experienced principal appraisers which unanimously opined that the goods were 32” and 42” Samsung brand LED TV sets in assembled form in retail packing without plastic cover, speaker and small number of accessories. The PCT heading 8528 already determined by the Assembly Group is in order.

Upon persistent representations of the importer, however, the matter is being referred to the Classification Centre for issuance of a Classification Ruling in this matter.

During the meetings held on September 27, 2014 and November 13, 2014, the representative of MCC Appraisement-West opined that the imported goods have essential character of TV receivers and that no special further manufacturing is involved. The goods are 32” and 42” TV sets without back cover, and built-in-system card, speakers, ribbon and wires and thus the goods are LCD receivers in unassembled form.

The importer and his representative asserted that the job of TV is to reproduce audio/video signals and since the impugned goods do not contain components that catch/decode/retransmit audio/video signals the same is not liable to be classified under the PCT heading for LCD/LED TV sets.

The importer submitted a detailed reply saying that as per [provisions of rule 1 of GIR (General Rules for Interpretation), classification is determined according to terms of the heading and any relevant section or chapter notes. If heading 8528 “reception apparatus for television whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus” is referred to it means that it must contain some instrument/appliance or mechanism or something else which must be capable of receiving broadcasted signals and transforming them into video. As far as rule 2(a) of GIR, the same cannot be applied to imported LED/LCD panels as the same does not have any essential character of television that is it cannot display any image or video and even cannot amplify any sound. The importer also presented copies of import tariff of Canada, South Africa and UK containing classification of flat display panels of various types under PCT heading 8529 as parts for television sets. The importer’s representative also referred to the Indian concessionary SRO 12/2012 of March 17, 2012.

The committee members scrutinized the details of the case, perused the additional documents presented by the importer and examined the sample. Trade tariff of South Africa mentions display panels against HS Code 8529, but this classification has been linked with the promotion of local manufacturing industry to which rebate of full duty and permit system have also been linked. The relative value added by the assemblers has been taken into account in arriving at the extent of the rebate.

As far as Canadian Tariff, the same classifies flat panel screen assemblies under heading 85.29 against applicable preferential tariffs. As far as the Indian concessionary SRO 12/2012 is concerned, the notification is issued on the same pattern as the concessionary SRO 565(1)/2006 dated June 5, 2006 in practice of Pakistan Customs. The concession offered under the concessionary notification is granted to manufacturers in Pakistan, where PCT headings are taken only for reference purposes and actual description of the item is more important to be linked with appropriate classification to be determined by the assessing officers. The samples of complete television set and imported LCD/LED careens were presented before the Committee to differentiate between a complete television set and LED/LCD display panel. The samples were consistent with LED/LCD television panels without built in system card, back cover, speakers and ribbons/wires. When asked the importer replied that the same are also imported separately.

The committee examined the entire issue in the light of rule 2(a) of GIR and based on this rule the sample as presented was clearly akin to a complete television set in terms of essential character. Moreover, in terms of value component of impugned item as compared with the value of missing parts, it could be conveniently gathered that LED/LCD panel occupies major portion of the value as juxtaposed to built-in system card, ribbon, wires and back cover.

After detailed deliberations, the PCT Committee concluded that the item declared as LCD/LED Panels in retail packing are appropriately classifiable under PCT sub-heading 8528.7212 in terms of rule 2(a) to the General Rules for Interpretation.

The public notice, dated November 18, 2014, was issued by Additional Collector I Zeba Bashir Ahmed. She is also the chairperson of the Classification Committee