Appealed from: United States Court of International Trade.
Kashiwa and Smith, Circuit Judges, and Wisdom,*fn* Senior Circuit Judge.
WISDOM, Senior Circuit Judge.
We consider here the proper judicial procedure for resolving an importer's complaint that the Customs Service has improperly classified its merchandise. We hold that the Court of International Trade is required to decide the correctness not only of the importer's proposed classification but of the government's classification as well. Because the trial court did not do so, we reverse and remand.
This case requires the Court to grope for the proper words for describing an imported product which does not readily fit into the importer's proposed classification or the government's classification of the merchandise.
The items at issue in this case are tippler hoppers. These are mining cars used to haul and dump ores and wastes from underground mines. The cars run on narrow-gauge rails, have no brakes, and are not self-propelled.*fn1 When the plaintiff, Jarvis Clark Co., imported tippler hoppers from South Africa between May 1980 and February 1981, it created a problem in legal semantics for the Customs Service. The Service classified the tippler hoppers under item 690.15 of the Tariff Schedules of the United States (TSUS), as "Railroad and railway rolling stock: Passenger, baggage, mail, freight and other cars, not self-propelled", and assessed a duty of 18 percent. The plaintiff had difficulty in thinking of its imported product as railway rolling stock and sued in the Court of International Trade, alleging that the tippler hoppers should have been classified under TSUS item 664.08, which covers "Mechanical shovels, coal-cutters, excavators, scrapers, bulldozers, and other excavating, levelling, boring, and extracting machinery, all the foregoing, whether stationary or mobile, for earth, minerals, or ores: pile drivers; snow plows, not self-propelled; all the foregoing and parts thereof: . . . Other." The duty for item 664.08 is 4.4 or 4.7 percent, depending on the date of importation.
On cross-motions for summary judgment, the trial court held in favor of the government. Jarvis Clark Co. v. United States, 566 F. Supp. 344 (C.I.T. 1983). The court did not consider the correctness of the government's classification. Instead, it found the plaintiff's proposed classification incorrect and concluded, "Plaintiff has failed to overcome the classification of customs under Item 690.15."
The court found item 664.08 inappropriate for two reasons. First, it examined heading 84.23 of the Brussels Nomenclature,*fn2 the heading corresponding to TSUS item 664.08. Heading 84.23 covers
"Excavating, levelling, tamping, boring and extracting machinery, stationary or mobile, for earth, minerals or ores (for example, mechanical shovels, coal-cutters, excavators, scrapers, levellers, and bulldozers); pile-drivers; snow-ploughs, not self-propelled (including snow-plough attachments)."
The explanatory notes state,
"This heading covers machinery, other than agricultural machinery (heading 84.24) for 'attacking' the earth's crust (e.g.,: for cutting and breaking down rock, earth, coal, etc.; earth excavation, digging, drilling, etc.), or for preparing or compacting the terrain (e.g., scraping, levelling, grading, tamping or rolling). It also includes pile-drivers, snow-plough attachments and non-self-propelled snow-ploughs."
4 Explanatory Notes 1237. Because tippler hoppers are not used for "attacking the earth's crust", but rather for carrying materials out of the mine after the materials have been severed from the earth, the court concluded that item 664.08 is inapplicable.
The court also relied on TSUS Schedule 6, Part 4, Subpart B, Headnote 1(i). ...