Lenovo case: Supreme Court interprets the word ‘portable’
In Hewlett Packard India Sales Pvt. Ltd. Lenovo Pvt. Ltd. vs Commissioner of Customs (Import), Nhava Sheva vase, the question that arises for consideration pertains to the correct classification of Automatic Data Processing Machines, popularly known as ‘All-in-one Integrated Desktop Computer.’ The Appellant in this case imported certain units of Concerned Goods, classified under “Tariff Item 8471 50 00.” The main question addressed in this case was “Whether the Concerned Goods are ‘portable’ or not under ‘Tariff Item 8471 50 00’? ” While hearing the case, the Supreme Court highlighted key characteristics of the Concerned Goods including the diagonal length of the display that is at the minimum of 18.5 inches. It may be clarified that presently certain models of the Concerned Goods even exceed this aspect by having the display’s diagonal length as wide as 25 inches while still being weighed under 10 kilograms.
To illustrate the factum of weighing less than 10 kilograms is sufficient to classify the Concerned Goods as ‘portable’ or not, the CESTAT vide its impugned order has relied on the dictionary meaning which defined ‘portable’ as “that can be easily carried and not permanently fixed in a place.” During the hearing, the top Court addressed that adjudicating authorities refer to online sources such as Wikipedia for supporting their conclusions. The Supreme court says “so for the reason that these sources, despite being a treasure trove of knowledge, are based on a crowd-sourced and user-generated editing model that is not completely dependable in terms of academic veracity and can promote misleading information as has been noted by this court on previous occasions also. Further adding, the courts and adjudicating authorities should rather make an endeavor to persuade the counsels to place reliance on more reliable and authentic sources. To interpret the word ‘portable’ a minute analysis was performed illustrating its definition according to different institutes and dictionaries.
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The Supreme Court bench comprising Justice Surya Kant and Justice Vikram Nath held that the Concerned Goods are not ‘portable’. First reason being the diagonal dimension of the Concerned Goods is a minimum of the length of 18.5 inches and the same needs to be transported along with the power cable and applicable stand in most cases if it is to be mounted. Secondly, there is no protective case designed by the markets for the daily transport of these Concerned Goods. The Apex Court allowed the appeals and set aside the impugned orders which classified the Concerned Goods under ‘Tariff Item 8471 30 10’ Moreover, it is directed that the valuation of the Concerned Goods for levy of the duty be determined under the initially declared ‘Tariff Item 8471 50 00’ whereas the appeal was disposed of.
