CTA Case No. 2756 (Decision)

I REPl.JRY .1r OF 'I I! :�: ' PliTUPPINltS COURT 0F TAX APPEALS Ol ' Y.7.0N C:ITV OLYMPIA J:)USINESS i�fi.�-'\CHINES CO. (PHILIPPINES) , INC . , Petitioner, - versus - CIA. CASE NO . 2756 COMiv\ISSIONER Of CU::; TOI~�IS, Respondent . X- - - - - - - - - - - X DEC I S I 0 N Petitioner Olympia J:)usiness Machines Co . {Philip- pines) , Inc . seeks tor the review of the decision of respondent Commissioner of Customs dated September 9, 1975 , atfi rming that ot the Collector ot Customs dated October 14, 1974 , denying its prot es t in Customs Case No . 74-15 9 (Manila Protest No. 8727) , and imposing upon it the amount ot F6 , 693 . 00 additional customs duty and �586 . 00 additional advance sales tax , or a total amount ot P7 , 279 . 00 which peti tioner paid under Official Receipt No . 0816785 dated Marc h 12 , 1973 . Petitioner, in its petition tor review, asks this Court tor the judicial retund ot said amount ot P7 , 279 . 00 , plus interest s and the costs ot suit. Petitioner is a corporation organized and existing under the laws ot the Philippines. It is engaged in the sale of Olympia otfice machines and spare parts. On or about January 17, 1973 , pe titioner imported six (6 ) crates ot various spare pa rts ot typewriters , adding machines and calculating mac hines which were discharged in the Port 6� Ma nila. In the import entry ,

DECISION - CTA. CASE NO. 2756 - 2- the spare parts were all declared and c lassi fie d by peti tione r under Tariff Heading No . 34.55 of the Tariff and Customs Code, as ame nded , with 10% ad valo rem duty. based on this classification, petitioner paid on the said shipment t he amounts of f>l7 , 146.88 and Pl 5 , 504 . 00 as customs duty and advance sales tax , respectively . Howe ver, be fo re the tinal liquidation ot the importation, the Burea u ot Customs picked out repres e ntative items of the imported spare parts and revised the clas s ifica- tion of t he aforesaid s pare parts by placing the subje ct r eprese ntati ve items under differe nt taritf headings and .subj ec ted t he same to highe r rates ot duty as tallows : Rate of Duty Rubb e r foot 40 . 148 50}6 Electric Mot or 85 . 01C so% Springs 73 . 35 30% Bolts , Nuts , Washer s , 73 . 32 Ri vets , Screws a nd studs Spool 73 . 408 Connecting Wi r e, Taut Wi re, Te nsio n sa;s VJ ire and Pull 1dire 85 . 238 Pins 73 . 34 100}6 Condenser 85 . 18 10% Switches 85 .19 50}~ Rubber Rings 40 ol48 50}6 As a result of the above reclassification, peti- tioner was assessed by the Col lector of Customs tor

Dl:CIS I ON - CTA. CASE NO. 2756 - 3- the Port of Manila and made li ao le for the payment o� the amounts of F6,693. 0 0 a nd f-5 86. 0 0, as additional cust oms duty and advance sales t a x, re sp ect i vely, which pet i tioner suose q ue ntly paid on March 12, 1973 as aforesaid under Of ficial Receipt No . 0816785. Petitioner suosequently and formally protested on March 20, 19 73, docketed as Man i la Customs Protest Case No . 8727 , the additional assess ment made and claimed tor the refunds ot the said additional customs duty and advance sales taxes it ha d pa id f ro m t he Collector ot - Cust oms. Th i s prote st was de ni e d in a dec i sion by the Co l l e ctor of Customs, which was subsequently atfirmed by the Commissioner of Cu s toms, on ap peal in the latter's decision dated ~e p tember 9 , 1 9 75. From this decisio n of the Commi ssione r of Customs, aforesaid petitio ner ap- pealed to this Court. The issue in the inst a nt case is whether or not the reclassification o� the various spare parts made by the Co l lector of Cu s toms and attirmed oy respondent Commissione r ot Cust oms is in accordance with law . Petitioner contends that the imported spare parts were pro perly classified oy it under Tariff Heading No . 84 . 55, Chapter 84, Schedule XVI ot the Taritf and Cus - toms Code ot the Phili pp ines , as amended . It asserts that the parts in question were imported and sold tor use solely or principally tor typewriters classified under Tariff Heading No . 84 . 51, and calculating or

.. . DECI~ION - l.TA . CA::il:. NO . 2756 - 4- or adding machines classified un de r Taritf Heading No. 84 . 52. Petitione r c laims that Tariff Heading No. 84 . 55, taken in re latio n to Taritf Head ing Nos . 84 . 51 a nd 84 . 52, squarely ap plies in this case . ~aid Tariff Heading No . 84 . 55 provides as tollows: 84 . 55 Pa rts and accessories (oth er than covers , carrying cases and the like) suitable tor use solely_gr P�inci�~1lY ~ith machine~_ot_E_t_ind t a l l - i.iliL::Yl..:t.hin he ading__~.Q..!. 84 . 5 1, 84 . 52, 84 . 53 or 84 . 54 . . � � a d val. 10% The relative Taritf Heading Nos . 84.51 and 84 . 52 re- ferred to in Taritf Heading No . 84 . 55, provide also as tollows: 84.51 Typewriters , other than type- writers incorporating calcu- lating mechanisms, cheque- writing machines � . � � � � ad va l. lQ% 84 . 52 Calculating machines ; account- ing machines, cash registers, postage- franking machines, ticket- issuing machines and similar machines , incorpora - ting a calculating device �� ad yal. 20% Based upon its claim that the spare part s were used solely fo r its Olympia typewriters , calculating and addin g machines , petitio ne r concl udes that the Burea u ot Customs had there tore erroneously reclassified the imported pa rts in controve rsy under the aforementioned various taritf head ings , other than Taritf Hea di ng No. 84 . 55 which reters t o parts and accessories ot ot fi oe machines such as typewriters, adding machines and cal- culating machi nes . Moreover, the ap plicatio n of said ( ,. . G ' ,:.._, Lt'.

- . .... ... ........ .... � �� �-� �- � �"���--~------r---� DECISION - CIA . CA~t NO . 2756 - 5- Taritf He adin g No. 84 .55 to the imported spare parts can De su stained, according to petitio ne r, oy the Expla nato ry Not es of the 1950 text ot the ~r us s els Nomenclature upon which the Taritf and Customs Code is oased, a nd pa rticularly under Rule 3, para gra ph (a), ot ~ ecti on 203, which pro vi des as tallows: Rule 3 . When articles are prima tacie, classifiable und e r two or more headings or suoheadings, or imported in sets consisting of several articles, clas sification shall be et� e cted as tal l ows: (a) The he a di.!J.9_Qr s ubhea di!lSL~hi ch � rov_i .Qg.�._:the m os.:t~.�i t i.�_Qg.�...~J:Jptio.n 2,ha LLJ2.~_pre tgrred_,:t.Q_.�!2.Y other he a di.!l9 .QI_su~bgading_hrov ~.Q1.ng_�_ill.QJ:g_qen eJ:Ql .Qg.�.�~1� t io n. (Und er l i ning ours.) On the oth e r hand, res ponde nt Commissioner o� Customs insists th at the recl assi ficati on ma de ot the imported articles are correct. We do not agree with re sponde nt. The represe nta- tive imported articles or items - 10 it ems al l in all, were all reclassified, at different Tariff Headings with the exception of condensers, and at rates higher than 10% . ~ut all these spare pa rts, consisting ot ( 1) ruober toots; (2) elec tric motors; (3) springs; (4) bolts, nuts, wa she rs, rivets , screws and studs; (5) spools; (6) connecting wire s, taut wires , tension wires and pull wire s ; (7) pins; (8) condensers ; ( 9 ) switches; and (10) ruooe r r i ngs , were all imported oy petitioner , without any contradiction on the part of respondent, as parts only ot Olympia otfice machines, ' ') r�� r"""j ,:.., ,_)

---- .. . .............. ��-�- -�----~--- - --~~~~_..................._....._ '. DECI ::, ION - CIA. CASE NO. 27 56 - 6- such as ca lculators, adding machi nes and portable , standard a nd electric typewriters . (Exhs . A to A- 28; A-29 to A-49; t.s . n., pp . 8 - 9 ; 10 -12; 12-22 ; 22-23, October 19, 1976 . ) Thes e sp are p arts were all manu- factured in \Jest Germany a nd impo rt e d to maintain and are suita bly used on l y t or Oly mp ia busine ss machines. (Jgid., t. s .n., pp. 22- 24; ibid., p . 4.) With r e spect to th es e represe ntative spare parts chosen oy the Collector of Cus t oms, as oasis f or its reclassification, it i s ve ry import a nt to take note of the foll owing uncontradicted de clarations o� petitioner's witness Robe rto Cama dini, Na t1on a l Technical Lonsultant of peti ti one r during the hea r i ng of th e case in this Court. with r e t e r e nce to th e ru~L.!.Oot~ {Exh. lj-1), it wa s aeclar e a uy ~a m aa1n1 th a t t h e ~e ~ p are part~ were to oe used ror . Olympia uu s 1n e~ s mac hl ne s - ty pewriters , calculat or s a nd ad ding ma chines - ana intenaea to reduce tn~ noi~e a na prot e ct the mov eme nt or the ma chines parts and cannot ue us ed tor a ny othe r ma chines . lt.s.n., pp. 8-9, Oct. 19 . 1976; see also t . s .n., p . 14, Jan. 12, 1977.) As to the elect ri c motors ( Exh. lj-L ), the~e ~pare parts were a e s1gnea t o ar i ve Olympia el e ctric typewriters, electric adding machines or c a lcul a tor~ and the~e cannot oe used as s pare parts tor other orana ot machines . (Ibia., pp. 16-17; 28-29.) Anent the importee srr~D~2 (Exh. B-3), these parts ' 8 ,'.....),t.'\. . '- ~1

�-----�--�--------��--�� ���--��� .. ��-� --� . _,. _... . _.... ........ ............. ~ ......... ........-------"--~-.-----�! DEi..... l ::ilON "'- CTA. CASE NO. 2 756 - 7- were particularly designed to produce t ens ion and used as a ma .in drum spring of 01 ympia ty pewrite rs . (]bid., p. 30; t . s.n . , p . 18, Jan . 12, 1977.) 2���WS and 21~ d s, the se spa re pa rts we re designed to hold together a machine a nd enabl e s ome parts to func- tion on a s pe cific design and we re ma de i n sizes and in t hickne ss , and used a nd f it t e d in a particular pl a ce in the Olymp i a brand ty pewrit e rs, adding machines and cal- culators . (Q2.Ci1 . , p . 31 ) Th e gumQe r screws ( Exh . 4), were mad e to hold t he carri age a t th e end motion of these mach i ne s. (t. s . n . , p . 20 , Ja n . 12, 1977.) The n~ts were intended to fast e n a certain attachme nt to the Olympia ty pewr ite rs and oth e r Ol ymp ia brand machines. (j oid., pp . 22 - 23 . ) As to t he 22QOls, the se sp a re parts are descrioed as round meta l parts tor pulli ng up th e riobons . The spring mecha nism ot th e s pool ha s s pe cific �unctions intended tor the Ol ympia e l e ctric typewriters and cannot be used in other brands ot typewriters . (t . s . n. , pp . 32 - 33; Oct . 19, 1976 . ) With res pect to t he tensi on and pull wires (Exhs . B- 6; B- 7), these parts con s tituted a linkage between the typewriter :bar and the intermedi at e bar tor Olympia typewriters. (t . s . n. , p . 23, J a n . 12 , 1977 . ) These cannot be used i n any other machines of other brands , and with respect to t he connecting , taut , and pull wires,

. - -� -� -� . . .. . .... .. ... ... . ___ __ - ' " .... "� �- --- ~- ~~----.._ __......_. DECISION - CTA. CASE ~0. 2 756 - 8- these parts were made ge ne ra lly as a linka ge between one mov ing part to another ot Olympia business machi nes . (QQ. Ci t ., pp . 33-34.) As to t he �.i.D�. , the se were �spe c it ically u sed in Olympi a el e ctr i c typ ewriters to hold the staff segment thereof, or the pins were us ed to hold i n place the capi t al and sma l l le t t e rs assemDly o� the sai d t y pewr i - ters . ( p . 370 , Customs Rec . ) 1dith respec t to .f_Qndensers (capacitors) l Exh. B- ,�/, these s pa re pa r ts were designed tor Olympia elec t r ic machines~ s uch as ty pew rit e rs a nd calc ul a tors a nd use d t o give the motor the right starting t ur n and ca nno t be used to r machines o� any othe r brands . (t . s . n. , pp . 37- 38 , Oct. 1 ~ , 1 976 . ) It provides the imp ulse s f or the drum cycl e (t . s . n. , p . 26 , Jan . 12 , 1977 ) a nd des i gned to �it th e power o� th e motor ot the Dusi ness ma chine s . (Ibid ., p . 27 . ) Coming to the swit ches (Exh . b- 9 ) , t hese a re pl a s- ti c switche s t or the red a nd Dlue r iDDe n mec ha ni sm of the said ty pewriters . ( Ibid ., p . 28 . ) These a r e the imp r essio n c ontro l or the ot f and on switches f or Ol ympi a electric typewriters , adding machines a nd calc ulat ors and which cannot De us ed tor any othe r bus i ness ma chine s ot othe r Dr a nds . (Ibid . , p . 39 ; t . s . n ., p . 28 , Ja n . 12 , 1977 . ) Lastly, wit h r espec t to th e ru DDe r r i na s , these were designe d a s a bump er to reduce nois e, le ve l t he ~2 c 0

DECI::>ION - CIA. CASE NO. 2756 - 9- moving parts and to e naole the operator to atfix top cove r s or parts ot ty pewrite rs a nd ca lcul9tors . (Ibid . , pp . 41 - 42.) Considering the aforesaid declared f acts relative to the spa re parts in question, and which were used by respondent to reclassity the same under other headings at high e r ~Q valQ�~~ duti e s , we are of the opinion t hat the application by pe titione r of Taritf Heading No . 84 . 55 , in relation to Taritt Heading Nos . 84 . 51 and 84 . 52 should be upheld . Taritf Heading Nos . 84 . 55 and 84 . 52 ot t he Tariff and Customs Code are quote d he r e und e r tor em phasis a nd analysis . 84.55 Parts and acces s ories (other than covers , carry i ng cases and the like ) suitable tor use solely or principally with machines ot a kind tail- ing within hea ding No . 84 . 51 , . 84 . 52 , 84 . 53 or 84 . 54 � . . � ad va l . 10~ 84 . 51 Typewrite rs , othe r than ty pe- writers incorpora ti ng calcu- lating mecha nism, cheque - writing machine s . . . � . . ad val . 29% 84 . 52 Calc ulating ma chines; account- ing machines , cash r egisters , postage-franking ma chines , ticket- issuing machines and similar machines , incorpora ting a calculating device . . ad y~l� 2~6 We take caretul note th a t t he ao ove quoted Tariff Hea d- ings Nos . 84 . 55 , 84 . 51 and 84 . 52 are under ~chedule XVI and under which Machine r y and Mechanical Applia nces; Ele trical Equipment and Parts Thereof are cl assified . 2Gl

�-� -- - -----����-----�-� - ---� �--~--�-~� , ",. .mr H r x c u m=-oa:=:�c�=�� = ��=�=�==='="'F~;o<;l;R> :::l";Q;'== DECISION - CIA. CA::>c NO. 27 56 - 10 - In the Explana tory Notes to the 1 950 text ot the brussels Nomenclature, u~ on wh i ch our tariff and customs laws are based (Montano Tejam, Preface to t he 1st and 3rd Ed, pp. VII-IX, ~o m.!:!}g nt.�r:ie.,Lof_! he_Bev_i_~e d_Iariff _,2[)d Customs ~ode_gt_~h~_E h ilip.Q in es , Vol . I , 197 3 Ed . ) , it provides that Schedule XVI , " x x x covers all mechanical or elec- trical machineries , apparatus and appliances and parts ther eof, x x x. " (Ibid., Vol . II , p . 1360) The classifications ot the articles in question are dete rmined princi pa lly according to the "terms of the taritf hea dings" and their r elative schedule and chapter notes . (::>ec . 203 , Tariff and Customs Code , as amended . ) And als o, pursuant to the same Explanatory Notes to the ~ russ e ls Nomenclature , re garding Tariff Hea di ng No. 84 . 55 , it stated that " subject to the general provi sion regarding t he classification of parts (see General Explanatory Note to ~chedule xVI)~ this heading covers parts and ac cess ories suitable tor use solely or .Qri.Q.� ip al l y with ma chine s ot he adi ng_�~51 , 8 4 . d~ ' 84.53 or 84 . 54" (Montano Te jam , g.Q � .�.Lt . Vol . III , pp . 1603- 1604 ; Underlin i ng ::>uppliedJ The Expla natory Notes , therefore , we re in substantially the same word in gs as what the law now pr ovides , that is the pr ovision in Taritf Heading No . 84 . 55 . A much more deeper insight into the provisio n of Taritf Heading No . 84 . 55 will sh ow th a t this heading covers " parts," witho ut a ny limita t i on as to their component materials, or limitation that these

DECISION - CTA. CJ\Sc i\lO. 2756 - 11 - cannot be used tor any purpose , except only that these are used as spare parts ot the machines or articles to which they are de s i gned or dedicated , hence, cla s s ifiable properly as pa rts of articles or �machines . (.�QQ Norma n G. Jensen, v . u.s . , 24 CCR 160; CD 1225, Vol . 4, Gus - toms Law Digest , Par. 8 . 6, p . 444.) As a matte r of legal principle , " parts " to be dutiable , must be speci- fically described a nd clearly identitied with suc h arti- cl e or machine and that it was manufactured and dedicate d solely tor use on a particular article or machine ; such to be useful fo r no other purpose and that such parts must be essential to that article . (Davies Turner & Co . v. u.s . 13 CCR 190 , CD 893 , 4 Customs Law Digest 445; U.s . v. oell & Howel l Co., 19 CCPA 151, TD 45263 , Aff ' g Abs 14388 , 4 Customs Law Digest 527 ; u.s. v . Kriss Kr oss Corp ., 24 CCPA 133 , TD 48607, rev 'g Abs 32310 , 4 Customs Law Digest 528 .) The importe d parts a nd/or accessories in q uesti on, on the strength ot the overwhelming evidence of �petitioner, were specifically descrioed and were designed especially or pa rticul arly tor use in replacing wornout parts tor the Olympia brand machines - typewriters, addi ng and cal- culating machines . The said spa re parts are compo nents ult imatel y to be a ssembled to the compl eted ma chines of petitioner and this contributes greatly to t he perf ormance of said machines; and t here is no evid ence which will show th a t these spare parts can be used in ma c hines of other

DECISI<DN - CTA. CASE NO. 2756 - 12 - brands; and these spare parts were oeing sQ1d for use as parts ot such Olympia ousiness machines. Accordingly, aforesaid spare parts, having been previously specifical- ly described as spare parts ot the Olympia business machines- typewriters, calculating and accounting machines named therein (u.s. v. American ~ead Co. , 9 Cu App. 279 TD 37873, Aff'g Abs 42259) are classifiable under Taritf Heading No. 84 . 55 as parts of typewriters, calculating and account- in~ machines reterred in Taritf Heading Nos . 84.51 and 84.52 rather than those taritf headings which respondent Commissioner of Customs and the Collector ot Customs have classified the same . By the clear terms or provision of Taritf Heading No . 84.55, the parts in question were manufactured and actually and practically intended as parts and accessories of the worn out Olympia busine s s machines - typewriters, adding machines and calculating machines . That being so, there is no way by which the said parts and accessories can be classified therefore under different heading clas- sifications (TH Nos . 40.148; 85.01; 73 . 32; 73.35; 73.408; 85 . 238; 73.34; 85.18; 85.19 and 40.148, all ot the Tariff and Customs Code, as amended) and under ditferent and/or higher tariff duties. It was error tor respondent Commissioner of Customs to classity the ruober toots and ruooer rings under Taritf Heading No. 40.14B with an ad valorem duty ot 50% because under the terms ot that heading, it classifies there under only

DtCI0I ON - CTA . Ci-\SE NO. 2756 - 13 - articles of ,1! nh2_rd_g ne.Q_y_vlcani zed ru t1ber such a;; rubber was hers are classifiable . Here, the rubber toots and r ubbe r rings i n ques tion were essentially ot very special kind of ru bber tit fo~ and int e nd~d s peciall y to reduce the no ise ot Olympia business machines. Mo reover, under legal note 3( c) of Chapter 40 , which covers "Rubber, Sy nthe tic Rubber , factice and articles thereot , under which Tariff Heading 40 .148 partic ularly fall , it pro- vides , with le gJl authority , that "me chanical or elec- .!.�:.le al ap p l_i_a nc es_�.Qc:l~ts (includinq elect ri cal goods of all k ind) , .QLhardf..!Jg_Q ru bber , talling within Sche dule XVI (coveri ng ma chinery and mechanical app li anc es; elec- t rica l equipment; parts th ere of) 11 are not cove red. ( ~nde rl iniD 9 ours .) Con sequentl y, petit ioner had pro- per ly classified the rub be r fo ots a nd rubber rings under Tariff He aa.l 11 Y o . 1... 84 . 55 . As to the ~.L~ctrlL- lllOtOr;:, , whlcn r~ ;:,p 011u ~ nt naa r�ccl assifi ed und e r Tariff Heading No. 85 . 01C at a n ad Y�1Q�Qill duty of sa~ , which cov e rs electrical goods such as generators, motors and tran sf orme r s , and others , t hi s recl as sifi ca ti on is e r roneo us f or t he r easons that (1) t he ele c tr ic moto rs were i mpo rt 2d as s pa re parts whi ch we re comme rci a lly a nd pr a ct i cal ly fit f or pe tit i on- e r 's Olympia busine ss machi nes ; a nd ( 2 ) t he Expla natory Not e s to th e 1950 t e xt of the Bru s s e ls Nome ncla t ure (Montano Tejam , fomment a ries on the Revis e d Tariff and . ~-~-~ .!.'::.~~ C o9.~ , as ame nd e d�, Vol . III , 1973 Ed ., p . 1649)

DEC I SION - CTA. CASE NO . 2 7~6 - 14 - ~: rovides th a t; 11 The pres e nt Char t e r (Chapter 85 - Electrica l f;lachine ry and Eq uip;�1c nt, Part s Th e r e of) covers a ll ele c trical ma ch inery a nd equipme nt other tha n ( a ) ID��hiD.�1:Y_ anQ__�pparatu2__ o f~ind C..QVei.: e d__Qy ChoI..!:.S.L84 , .!::! hi cb_.I.S.!D~AJJ2.__<;:.l..Q2._~ i fie d there eve n i f ele.�.!:I.: ic--r~ ee \Jene:r:al E~ planato ry Note on tha t Chap ter . '1Lita llcs Uurs..!./ In othe r words , even if the article in ~ u est ion is an ele ctric motor , inasmuch a s the e lect ric motors were in- ten de d to be pa rt of , a nd s uitab ly and actuall y, sol e ly and r rincipally used in ma c hiner i e s covered by Chapter 84 ( Boil e rs , Machinery and Mechanica l Ap pliances; Parts There of), under which Taritf Heading No . 84 . 55 falls, the electr i c motors are suoject to 10% taritf duty , as of parts andjor ac ce ssories/typewriters , adding and calcu- lating machines . With regard to the springs, res po ndent reclassified these under Taritf Heading No . 73 . 35 , covering spring and leave s ot springs , made of iron and steel, with an ad valorem duty ot 3~6 . This is not correct. Under the ~xplanatory Note of the 1950 text ot the brussels Nome n- cl a ture (Montano Tejam, Ibid. , Vol . II , pp . 1226-122 7), it provid es th a t Taritf Heading No . 73.35 excludes " c) Springs , assemoled with other articles to form x x x, identitiable garts of machinery ( ~ ch e dule XVI) x x x." Th is means that the springs in q uestion , which were pa r- ticu larly designed to produce t ensio n and used as spring ot the main drum ot Olympia typewriters, should not therefore be classitied under Tariff Heading No. 73.35.

DECISION - CTA. CASt NO . 2756 - 15 - This more than ever strengthens the view that parts and accessories used solely and principally destined tor typewriters, adding machines and calculating ma chines, and used tor no other purpose , shduld oe classified under Tariff Heading No . 84.55 at l~lo ad yal9rem duty. The bolts, ~, W2 Shers , rivets, screws and studs were wrongly reclassified under Tariff Heading No . 73.32 with a taritf duty of 5~~ by res pondent . For the same reason, as heretofore adverted to, with respect to the articles above stated , these are parts suitable tor and used solely in machines, such as the Olympia typewriters, adding and calculating machines, oecause they were mainly de signed to hold together the said Olympia business machines' parts together, and he nce, should be properly clas sitied under Taritf Heading No . 84.55. Whil e these articles may literally tall under the articles mentioned or listed under this heading, such as the nuts , rivets and washers, yet, in the legal notes under ~che dule XV cov ering ~ase Metal and Articles of ~ase Meta ls, where Taritf Heading No . 73 . 32 talls, and considering that the legal notes under ~chedule XV is a part ot the law itself, legal notes l(t) of said ~chedule XV declares that arti- cles talling within ~chedule XVI (kachinery , Mecha nical Appliances, El ect rical Equipments and Parts Thereof) are not covere d by said ~chedule xV . Accordingly , the parts and accessor � ~s used solely and principally on mechanical appliances and electrical equipments , such as the oolts , ,, ,~ ~~ ~GI

---- ---------,.-:;~--- DECI~ION - CTA. CA~E NO . 27 56 - 16 - nuts, wa sher s, rivets, s crews and studs in q ues~ion are not, there tore , included in said Taritf Heading 73 . 32 , cut properly classitied und e r Tariff Heading No . 84.55. Regarding the .�..QQOls , wh i ch ' were special parts used i n Olympia typewriters , it was mistakenly classi- fied under Taritf Heading No . 7 3 . 408 as oth e r articles ot iron or s teel with an ad yalorem duty of 7Cf}6 . We believe that since these spools were intended for use specially on Olymp ia cusines s machines , and to no othe r, it was properly classitied by petitioner under Tariff Heading No. 8 4.55 . Anent the t e nsion , conn ectin~ , tau! and QQll wires , these wires provide the linkage cetween parts ot the Olympia cusiness machines such as the typewriters and intermediate oar of the Olympia typ ewriters . He nce, for respondent to classity these parts under Tariff Heading No . 85 . 23b, with tariff duty ot SO% �Q valorem , it was error since the articles classitiacle under Tariff Head- ing No . 85.23b pertains to insul a ted el ec tric wire , caole, bars strip and the like . In these particular imported wires of petitioner , these are without any in- sulations, unlike the electric wire properly classifiable under Tariff Heading No . 85 . 23 8 . Acco rdingly, reclassi - fication of thes e articles under Taritf Heading No . 85 . 23b was incorrect and considering t hat these parts were used particularly tor the Olympia typewriters, adding and calcula ting machines, they should be classitied properly

DECISION - CTA. CASE NO . 2756 - 17 - under Tariff Heading No . 84 . 55 and subject to Ol}lY 10% ~.Q val or em duty. Coming now to the 2ins, which r esp onde nt reclassi- fi e d und e r Tari t f Heading I~o . 73 . 34 , subject to 100% , we find such reclas s i fi cation to be erroneous . Taritf Heading No. 73. 34 hereunder cle arly classifies ordinary articles s uch as ordina ry pins , safety pins, hair pins , curl i ng pi ns , pointed sha nks tor brochures, oadges , hat- pins and others . (Expla natory Note to the 1950 text of th e l:i ru ssels Nomenclature , cit e d i n Monta no Tejam , ioi.Q, vo l . II , 1 9 73 Ed ., p . 1225-122 6 . ) Clearly the imported pins in ques tion were not essent ially of the character as t hose stated i n the Expla natory Notes to t he brussels Nome nclature with resp ec t to the classificatio n ot arti- cl es und er Taritf Hea ding No.� 7 3 . 34 . be ca use ot the pins' distinct characteri stics ot holding in place the ca pi tal a nd small le tte rs a ssemoly ot the Olympia elec- tric typewriters , it should be appropriately classitied under Taritf Heading No . 84 . 55 , rather than under 73. 34 which classities ordi na ry pins . As to the condensers or ��Qacito~~ ~ these articles were i ncorrec tly clas sifi ed by r esponde nt as falling und er Taritf Heading No . 85 .18 . While condense rs or capacitors ma y literall y oe classi t iable un de r Taritf Heading No . 8 5.18 , yet , whe re the condensers which were imported oy petitioner were comme rcially or particularly desi gned and used to give the motor ot the petitioner's

DECISION - CTA. CASE i~O . 2756 - 18 - business machines the right starting turn and made to tit the power of the same Olympia electric machines - typewriters, adding machines a nd calculating machines - and the same cannot be used in other machines of dif- ferent brands , ostensibly these pa rts or accessories sho uld oe classified properly and suoject to 10}6 ad valo- ~ duty un der Taritf Heading No . 84 . 55 . Finally , the switches imported oy petitioner were incorrectly clas s iti ed by r espond ent under Taritf Heading No . 85 . 19 with an ad valorem duty ot 50/6 since this pro - vision substantially pertain to electrical switches and its connections . The articles wh i ch are s ub ject to duty und er Taritf Hea ding No . 85 .19 are those designed to make or break electrical circuits . In the case at oar , the plastic switches which petitioner imported are ot a type and desi gn i nt ended to turn the ribbo n me ch anis m or to change to red or clue type of the Olympia ousiness machines . These are the switches tha t controls the color ot the ricbon as de sired oy the ope r ator . Since Tariff Heading No . 85 . 19 does not a pp ly becau~e of the nat ure of the imported switches in question and that, turthermore , the switches having bee n desi gned only tor Olympia type - writing ma chines, not to ma ke or creak electrical circuits, and these cannot t urthermore be used tor machines of any other orand, these switches should oe classified properly und er Taritf Heading No . 84 . 55 . Considering the above a nalysis , the imported "pa rts" () r" l r..; ~el \_..

Dl::CI~ION - CTA. CA~t: NO. 2756 - 19 - in question cannot De classitie d unde r the headings here- to for e used DY respondent, as th e re was no showing in the evidence or the records of this case that the imported parts can De used ap propriately, pra ctically or commer- cially , and/or tit tor use in machines ot other brands, or other than as parts ot petitioner's ousiness machines. It is our opinion that petitioner is not liable tor addi- tional customs duty on its importations and the same having been paid , respondent is, theretore , legally oound to retund the said sum ot f6,6 9 3 ~00 as overpaid customs duty . It is noted , however, th a t no claim tor refund ot the sum ot ~ 5 8 6 . 00 as advance sales tax paid was tiled oy petiti one r with the Commiss i oner ot Internal Revenue and that th e latter was not made a party to this case. Und er the doctrine laid down in our decision in the case ot Wise and Compa ny, Inc . v s . Rolando G. Geotina , Commis- sioner ot Customs , CTA Case No . 2717 dated DecemDer 29 , 1977 , we held therein , as we similarly hereto hold , that tor tailure of pet i t io ne r to file a written claim tor retund ot said advance sales tax with the Commissioner o� Internal Reven ue a nd tor not maki ng the latter a party to this case, th i s Court is wi thout jurisdiction over the said refund ot t he adv ance sales tax . 1!JHEREJ:-ORE , the de cision of the Commissi oner of Customs ap pea led �rom is hereby modified . Respondent

DECI~ION - CIA. CASE NO . 2756 - 20 - .Commissioner of Customs is here oy ordered t o retu nd to petitionnr Olympia business Machi nes Co. ( Phi l . ) , Inc . the sum ot I=>6 , 69 3 o00 a s ove rpaid customs duty. No pro noun c eme nt as t o costs. SO OHDC:RE D. Quezon City , Me tro Ma ni l a , August 25, 1980 /?,� / CO~ R;;AQUIN ( Ass ociate Judge WE COI\CUR : ~~-t;_i~~ AMANTE f /L~ER Pr esiding J ud ge