CLA-2 CO:R:C:M 952403 KCC
Asst. District Director
U.S. Customs Service
Interstate 87
Champlain, New York 12919
RE: Protest No. 0712-92-100808; indoor light garden systems;
8432.80.00; agricultural or horticultural machinery; 085942;
EN 84.32; metal shelf; plastic tray; electric lighting
fixture; NY 827323; furniture; Note 2, Chapter 94; General
EN (A) and (B), Chapter 94; designed to be placed on floor;
utilitarian purpose; 9817.00.50
Dear Sir:
This is in response to the Application for Further Review of
Protest No. 0712-92-100808, dated July 14, 1992, which pertains
to the tariff classification of indoor light garden systems
imported from Canada under the Harmonized Tariff Schedule of the
United States (HTSUS).
FACTS:
The articles under consideration are Floralight's indoor
light garden systems (garden systems), No. TM48S which is a one
tiered system, No. 2T48S and 2T24S which are two tiered systems,
and No. 3T48S which is a three tiered system. The 2T and 3T
models are floor standing systems, whereas the TM model is a
table top system. Depending on the number of tiers, each of the
garden systems will consist of one or more of the following
items:
1) electric lighting fixture,
2) metal frame
3) metal shelf, and
4) plastic tray.
The garden systems which are designed for both hobbyists and
professionals allow for plant growth and care when outdoor
conditions are not desirable or appropriate.
Upon importation, the 3T48S, 2T48S and 2T24S were
liquidated under subheading 9403.20.00, HTSUS, which provides for
"Other furniture and parts thereof...Other metal furniture." The
TM48S was liquidated under subheading 7326.90.90, HTSUS, which
provides for "Other articles of iron or steel...Other...Other...
Other." The above classifications were based on New York Ruling
(NY) 827323 dated February 26, 1988, issued to the protestant,
Floralight Gardens Canada Inc., which classified the floor
standing systems under subheading 9403.20.00, HTSUS, and the
shelf or table top systems under subheading 7326.90.90, HTSUS.
On the invoice and entry summary, the protestant classified
all of the garden systems under subheading 9403.20.00, HTSUS.
However, the protestant now contends that the garden systems are
properly classified under subheading 8432.80.00, HTSUS, which
provides for "Agricultural, horticultural or forestry machinery
for soil preparation or cultivation; lawn or sports ground
rollers; parts thereof...Other machinery." The protestant states
that the garden systems are machinery as defined in Webster Ninth
New Collegiate Dictionary which defines machinery as:
Mechanically, electrically or electronically operational
device for performing a task.
The protestant states that the "actual use" of the garden systems
should be considered, as they are designed and dedicated to a
specific agricultural or horticultural use, and not for any other
purpose.
The protestant cites Headquarters Ruling Letter (HRL) 085942
dated January 18, 1991, as evidence that the garden systems
should be classified as agricultural or horticultural machinery.
HRL 085942 held that identical garden systems were classified as
agricultural and horticultural implements not specially provided
for in item 666.00, Tariff Schedules of the United States (TSUS)
(the precursor tariff provision to heading 8432 to 8438, HTSUS).
If classification under subheading 8432.80.00, HTSUS, is denied,
the protestant requests that consideration be given to the tariff
classification of all the garden systems and the plastic trays
under subheading 9403.20.00, HTSUS.
ISSUE:
What is the proper tariff classification of the indoor light
garden systems under the HTSUS?
LAW AND ANALYSIS:
The classification of merchandise under the HTSUS is
governed by the General Rules of Interpretation (GRI's). GRI 1,
HTSUS, states in part that "for legal purposes, classification
shall be determined according to the terms of the headings and
any relative section or chapter notes...."
The protestant contends that the garden systems are properly
classified under subheading 8432.80.00, HTSUS, as agricultural or
horticultural machinery. In support of this contention, the
protestant cites HRL 085942 as evidence that the garden systems
should be classified under that tariff provision. In HRL 085942,
we held that the protestant's identical indoor garden systems
were classified in item 666.00, TSUS, which provided for
"...agricultural and horticultural implements not specially
provided for...."
Congress has indicated that earlier tariff decisions must
not be disregarded in applying the HTSUS. The conference report
to the Omnibus Trade Bill of 1988, states that "on a case-by-
case basis prior decisions should be considered instructive in
interpreting the HTS[US], particularly where the nomenclature
previously interpreted in those decisions remains unchanged and
no dissimilar interpretation is required by the text of the
HTS[US]." H. Rep. No. 100-576, 100th Cong., 2D Sess. 548, 550
(1988). In this instance, we do not find HRL 085942 to be either
instructive or applicable. There is a significant change in the
text of the nomenclature from item 666.00, TSUS, to subheading
8432.30.00, HTSUS, which requires a different interpretation.
The term "agricultural or horticultural implements not specially
provided for" is not included in headings 8432 to 8438, which are
the successor HTSUS tariff provisions to item 666.00, TSUS.
Heading 8432, HTSUS, describes specific types of machinery to be
classified therein. Therefore, we do not find HRL 085942
instructive in this case.
Explanatory Note (EN) 84.32 of the Harmonized Commodity
Description and Coding System (HCDCS) states that heading 8432,
HTSUS, "covers machines, whatever their mode of traction, used in
place of hand tools, for one or more of the following types of
agricultural, horticultural or forestry work, viz:
(I) Preparing the soil for cultivation (clearing, breaking,
tilling, ploughing, loosening, etc.).
(II) Spreading or distributing fertilisers, including
manure, or other products to improve the soil.
(III) Planting or sowing.
(IV) The working or maintenance of soil during the growing
period (hoeing, weeding, cleaning, etc.)."
EN 84.32 continues by stating that "[t]he machines of this
heading may be hauled by an animal or by a vehicle (e.g., a
tractor), or may be mounted on a vehicle (e.g., on a tractor or a
horse-drawn chassis)." The machines contemplated by heading
8432, HTSUS, include ploughs, harrows, scarifiers, cultivators,
weeders, hoes, seeders, planters, transplanters, fertiliser
distributors, rollers, thinning-out machines, etc. HCDCS, Vol.
3, pgs. 1208-1210. The Explanatory Notes, although not
dispositive, are to be looked to for guidance in interpreting the
HTSUS. 54 Fed. Reg. 35127, 35128 (August 23, 1989). The garden
systems are not the type of article contemplated by heading 8432,
HTSUS. The garden systems are not machines used to prepare,
plant and/or maintain soil in the agriculture, horticulture or
forestry industries. Furthermore, it is our position that the
garden system is not a machine. The article is not "operational"
as required by the Webster definition. Therefore, classification
of the garden systems must be found elsewhere.
As classification under subheading 8432.80.00, HTSUS, has
been found inapplicable, the protestant requests that all of the
garden systems be classified under subheading 9403.20.00, HTSUS,
as other metal furniture. General EN (A) and (B) to Chapter 94
states that for the purposes of this Chapter, the term
"furniture" means:
(A) Any "movable" articles (not included under other more
specific headings of the Nomenclature), which have the
essential characteristic that they are constructed for
placing on the floor or ground, and which are used,
mainly with a utilitarian purpose, to equip private
dwellings, hotels, theatres, cinemas, offices,...
(B) The following:
(i) Cupboards, bookcases, other shelved furniture and
unit furniture, designed to be hung, to be fixed
to the wall or to stand one on the other or side
by side, for holding various objects or articles
(books, crockery, kitchen utensils, glassware,
linen, medicaments, toilet articles, radio or
television receivers, ornaments, etc.) and
separately presented elements of unit
furniture....
HCDCS, Vol. 4, p. 1574.
In this case the two and three tiered garden systems (3T48S,
2T48S and 2T24S) are movable articles which are constructed to be
placed on the floor and are used for a utilitarian purpose. The
garden systems allow the garden hobbyist or professional to grow,
maintain and care for plants indoors when the outdoor conditions
are undesirable or appropriate for proper growth. Therefore, the
3T48S, 2T48S and 2T24S garden systems are properly classified
under subheading 9403.20.00, HTSUS.
However, the TM48S cannot be classified as furniture under
subheading 9403.20.00, HTSUS. To be classified as furniture
under subheading 9403.20.00, HTSUS, articles must be designed to
be placed on the floor or ground. See, Note 2 to Chapter 94,
HTSUS. The TM48S garden system is not designed to be placed on
the floor or ground but on a table top. Therefore, the TM48S
cannot be classified under subheading 9403.20.00, HTSUS. The
TM48S garden system is properly classified under subheading
7326.90.90, which provides for "Other articles of iron or
steel...Other...Other...Other."
Some articles are entitled to duty free treatment under
subheading 9817.00.50, HTSUS,if the articles are used for
agricultural or horticultural purposes. Subheading 9817.00.50,
HTSUS, describes "Machinery, equipment and implements to be used
for agricultural or horticultural purposes..." To fall within
this special classification a three part test must be met.
First, the article must not be among the long list of
exclusions to subheading 9817.00.50 and 9817.00.60, HTSUS, under
Section XXII, Chapter 98, Subchapter XVII, U.S. Note 2, HTSUS.
Secondly, the terms of the subheading must be met in accordance
with GRI 1. Subheading 9817.00.50, HTSUS, describes "Machinery,
equipment and implements to be used for agricultural or
horticultural purposes..." This determination focuses upon the
specific agricultural or horticultural pursuit in question and
what machine, equipment or implement performs this pursuit.
Thirdly, the merchandise must satisfy the conditions of section
10.131 to 10.139, Customs Regulations (19 CFR 10.131-10.139).
The garden systems are classified under subheading
7326.90.90 and 9403.20.00, HTSUS. Section XXII, Chapter 98,
Subchapter XVII, U.S. Note 2(ij) lists the exclusions to
subheading 9817.00.50 from Chapter 73, HTSUS. Subheading
7326.90.90, HTSUS, is excluded from Subchapter XVII, U.S. Note
2(ij). Therefore, the TM48S garden systems is not eligible for
duty free treatment under subheading 9817.00.50, HTSUS. However,
subheading 9403.20.00, HTSUS is not excluded from Subchapter
XVII, U.S. Note 2. Therefore, the 3T48S, 2T48S and 2T24S garden
systems meet the first prerequisite.
Secondly, the 3T48S, 2T48S and 2T24S garden systems must be
included within the terms of subheading 9817.00.50, HTSUS. They
must be "machinery," "equipment" or "implements" used for an
"agricultural or horticultural purpose." In this case, the
horticultural pursuit is the growth and care of plants indoors
when outdoor conditions are not desirable or appropriate. The
3T48S, 2T48S and 2T24S garden systems are the actual equipment or
implements that provide the structure and necessary conditions
which allow for the growth of the indoor plants. Therefore, the
3T48S, 2T48S and 2T24S garden systems meet the second
prerequisite.
However, regarding the protest under consideration, the
third prerequisite has not been met. In order to qualify for
duty free treatment under this provision, the protestant must
follow the regulations set forth in 19 CFR 10.131-10.139. 19 CFR
10.131-10.139 are the applicable regulations for the entry of
merchandise whose rate of duty is dependent upon actual use. The
protestant did not satisfy the condition found in 19 CFR 10.131-
10.139 in that they did not declare intent as required in 19 CFR
10.134. Thus, the 3T48S, 2T48S and 2T24S garden systems are not
eligible for duty free treatment under subheading 9817.00.50,
HTSUS.
HOLDING:
The TM48S indoor light garden system is properly classified
under subheading 7326.90.90, HTSUS, which provides for "Other
articles of iron or steel...Other...Other...Other."
The indoor light garden systems, 3T48S, 2T48S and 2T24S, are
properly classified under subheading 9403.20.00, HTSUS, which
provides for "Other furniture and pats thereof...Other metal
furniture."
This protest should be denied. A copy of this decision
should be attached to the Customs Form 19 and provided to the
protestant as part of the notice of action on the protest.
Sincerely,
John Durant, Director
Commercial Rulings Division