Collectors, Conference on 21/ 22, July, 1994 at Madras had discussed this issue and has held that it is incorrect to club two entries of a particular notification.

2.    However, CEGAT in its Orders No. 1995 (60) ECR 85 and 1996 (82) ELT 238 have allowed the appeal filed by the importers on the ground that merely on the basis of the fact that a machine can perform an additional function, benefit of the notification cannot be disallowed especially when the two items are separately covered by the same notification. It had held that a combination of the two machines does not turn out to be third entity since in performs functions of both the equipments.

3.    Board has re-considered this issue in depth. As per HSN explanatory notes relating to classification of multi function machines, where it is not possible to determine the principal function and where the context does not otherwise require, it is necessary to apply general interpretative Rule 3(C). As per the said rule, where the goods cannot be classified by reference to interpretative rule 3(a) or 3(b) they are to be classified under the heading which occurs last in numerical order among those which equally merit consideration.

4.    The multi- function  machines are being manufactured and imported regularly. The above decision of the tribunal has been reiterated by many benches before the discussion in the Tariff conference and after the decision also.

5.    It is, therefore decided that for the purpose of classification and entitlement for exemptions main function of the machine may be considered as a criterion and benefit be given to a combination machines treating it as a machine performing main function and its additional function may be ignored for the purpose of classification and exemption under a notification. Where the main function is not ascertainable, the Rule 3 (c) may be applied.