HQ 0951986 - Decision on application for further review of protest no. 3801-2-100761; classification of a leather and polyester/ cotton blend fabric bandana; neither leather nor fabric components impart essential character; GRI 3(c); heading 6214.30.0000, HTSUSA; imports may receive a reduced rate of duty under the CFTA; Form 353; extension of liquidation pursuant to 19 CFR 159.12(b); 19 U.S.C. 1504(b); CF 28. - United States International Trade Commision Rulings

United States International Trade Commision Rulings And Harmonized Tariff Schedule

faqs.org Rulings By Number Rulings By Category Tariff Numbers

faqs.org > Rulings and Tariffs Home > Rulings By Number > 1993 HQ Rulings > HQ 0951986 - HQ 0952077 > HQ 0951986

HQ 951986

October 28, 1992

CLA-2 CO:R:C:T 951986 SK

CATEGORY: CLASSIFICATION ENTRY

TARIFF NO.: 6214.30.0000

Assistant District Director
U.S. Customs Service
Patrick V. McNamara Building
477 Michigan Avenue
Detroit, MI 48266

RE: Decision on application for further review of protest no. 3801-2-100761; classification of a leather and polyester/ cotton blend fabric bandana; neither leather nor fabric components impart essential character; GRI 3(c); heading 6214.30.0000, HTSUSA; imports may receive a reduced rate of duty under the CFTA; Form 353; extension of liquidation pursuant to 19 CFR 159.12(b); 19 U.S.C. 1504(b); CF 28.

Dear Sir:

This is a decision on application for further review of a protest timely filed by John V. Carr & Son, Inc., dated March 4, 1992, against your decision on the classification of textile and leather bandanas. A sample was submitted for Customs examination.

FACTS:

The article at issue is a bandana constructed of a 50/50 polyester/cotton blend fabric on one side, and 100 percent finished cowhide leather on the reverse side. The fabric side is silkscreened and painted with a scene of Mt. Rushmore and bears the legend, "1990 Sturgis South Dakota 50th Anniversary." Velcro-like strips are attached to the narrowest two points of the article which allow the bandana to be worn on either side and provide a means of closure as the leather component prevents the article from being tied.

The bandanas were entered on August 9, 1990. In response to a request for additional information on a CF 28, a sample was submitted to the District Director on July 22, 1991. In the meantime, on April 20, 1991, a notice of extension of liquidation had been issued. On October 8, 1991, a Notice of Action (CF 29) was issued indicating a change in classification of the merchandise. The entry was then liquidated at the proposed rate and classification, indicated on the CF 29, on December 13, 1991.

Protestant contends that the entry should have been deemed liquidated at the end of one year at the rate asserted at the time of entry. Protestant alleges that no notice of extension was received by either the importer or the surety as required by 19 CFR 159.12(b). Protestant asserts that the requested sample was submitted to the District Director on July 26, 1991, more than two months before the one-year time limit had expired. Therefore, there would have been no valid reason to cause the liquidation to be extended.

Protestant also asserts that the subject merchandise is eligible for a reduced rate of duty under the United States- Canada Free Trade Agreement (CFTA).

We note that the Customs Form 6445, in the section designated "District Director's Position", states that the subject merchandise is correctly classifiable under subheading 4203.40.6000, HTSUSA. This is a clerical error and should be disregarded.

ISSUES:

1) What is the proper classification of this article?

2) Does this article qualify for preferential treatment under the U.S.- Canada Free Trade Agreement?

3) Whether the subject entry was deemed liquidated by entry of law?

4) Whether a proper notice of extension was issued?

LAW AND ANALYSIS:

CLASSIFICATION:

Classification of merchandise under the HTSUSA is in accordance with the General Rules of Interpretation (GRI's). GRI 1 requires that classification shall be in accordance with the terms of the headings and any relative section or chapter notes and, unless otherwise required, according to the remaining GRI's taken in order.

The subject merchandise is a bandana comprised of a printed textile side and a leather side. As the two components are classifiable under different headings in the Nomenclature, heading 6214, HTSUSA, which provides for shawls, scarfs, mufflers, mantillas, veils and the like, and heading 4203, HTSUSA, which provides for articles of apparel and clothing accessories of leather, no single heading covers the subject merchandise in its entirety and classification cannot be accomplished by application of GRI 1 alone. GRI 3 provides the relevant analysis in this instance.

When, by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be affected as follows:

(a) The heading which provides the most specific description shall be preferred to headings providing a more general description.
However, when two or more headings each refer to part only ... of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.

As noted supra, classification of the article at issue is possible under two equally specific provisions in the Nomenclature, and GRI 3(b) applies as follows:

(b) ... composite goods consisting of different materials or made up of different components... which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character.

Explanatory Note VIII to GRI 3(b) states that:

The factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.

With regard to the article at issue, it is impossible to determine which of its components determines this article's essential character: the leather which is the costliest component and comprises the bulk of this article's weight, or the printed textile component which, although of lower value, bears a commemorative legend which may very well provide the motivating impetus for the purchase of this article. This article is not intended to be worn with only the leather or the textile side showing. The article is intended to be worn with both sides showing as is evidenced by the velcro-like strips which create a reversible bandana. Both sides contribute equally to the identity of this article and neither side imparts the bandana's essential character.

GRI 3(c) sets forth that when goods cannot be classified by rrreference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration. Accordingly, the article at issue is properly classified under heading 6214, HTSUSA, the heading which occurs last in numerical order between the two relevant headings set forth above.

REDUCED RATE OF DUTY UNDER THE CFTA

As attested to in Customs Form 353, submitted by the protestant to your office, the goods the subject of this protest have been designated as products wholly the production of Canada or the United States. Accordingly, these articles are eligible for a reduced rate of duty under the CFTA.

VALIDITY OF EXTENSION OF LIQUIDATION AND FORM OF NOTICE

Liquidation of an entry of merchandise constitutes the final computation by Customs of all duties accruing on that entry. American Permac, Inc. v. United States, 10 CIT 535, 537, 642 F. Supp. 1187, 1190 (1986). Under 19 U.S.C. section 1504, Customs is bound by certain time limits during which liquidation must occur. If Customs fails to liquidate an entry within one year from the date of entry or final withdrawal from warehouse, that entry is deemed liquidated at the rate of duty, value, quantity and amount of duties asserted at the time of entry by the importer, his consignee, or agent. Customs is permitted to extend the one year period, under 19 U.S.C. section 1504(b) in certain circumstances:

(1) if additional information is needed to classify the goods;

(2) if liquidation is suspended by statute or court order; or

(3) the importer, consignee, or his agent requests an extension.

Customs must provide the importer with notice of the extension. Any entry not liquidated at the expiration of four years from the date of entry or withdrawal from warehouse is deemed liquidated at the rate of duty, value, quantity, and amount of duty asserted at the time of entry, by the importer, unless liquidation continues to be suspended.

Regarding the subject entry, it is clear that Customs was authorized to extend liquidation under 19 U.S.C. section 1504(b). The Request for Information (CF28) was issued to obtain information from the importer relative to the correct classification of the merchandise. The issue of whether an extension for insufficient information is justified under 19 U.S.C. section 1504(b)(1) was addressed by the Court of International Trade in Detroit Zoological Soc'y v. United States, 10 CIT 133, 630 F. Supp. 1350 (1986). The court held that the term "information" as used in 19 U.S.C. section 1504(b)(1), "should be construed to include whatever is reasonably necessary for proper appraisement or classification of the merchandise involved." 10 CIT at 138, 630 F.Supp. at 1356. Thus, it is clear that liquidation of the subject entry was properly
extended. Protestant's contention that the entry was deemed liquidated on the one year anniversary because the relevant sample was submitted more than two months before the one year anniversary is without basis. Once a notice of extension is issued the extension is valid for one year. Therefore, Customs had one year from the date the notice of extension was issued (April 20, 1991) within which to liquidate the entry.

Having determined that extension of the subject entry was proper, there remains protestant's contention that it never received the notice of extension. Customs must give notice of the extension of liquidation to the importer of record in the form and manner prescribed in the regulations. The regulations provide that Customs shall give notice on Customs Form 4333-A, and the notice shall state the reason for the extension. 19 CFR 159.12(b). Failure to provide such notice results in liquidation by operation of law. Enron Oil Trading and Transportation Co. v. United States, 15 CIT ___, Slip. Op. 91-91 at 3 (Sept. 27, 1991) (citing Pagoda Trading Co. v. United States, 9 CIT 407, 411, 617 F. Supp. 96, 99 (1985), aff'd, 804 F.2d 665 (Fed. Cir. 1986).

Government officials are entitled to a presumption that their duties are performed in the manner required by law. Star Sales & Distributing Corp. v. United States, 10 CIT 709, 710, 663 F. Supp. 1127, 1129 (1986); see Enron Oil Trading, 15 CIT at ___, Slip. Op. 91-91 at 4. The presumption may be rebutted by evidence indicating that notice was not received. In the instant protest, protestant makes a naked assertion in its protest that no notice of extension was received by either the importer or the surety. Protestant did not provide any evidence to support its assertion. Thus, protestant has failed to rebut the presumption that proper notice was given. See International Cargo & Surety Insurance Co. v. United States, 15 CIT ___, Slip. Op. 91-99 at 28-29 (November 15, 1991).

HOLDING:

The subject merchandise is properly classifiable under subheading 6214.30.0000, HTSUSA, which provides for shawls, scarves, mufflers, mantillas, veils and the like made of synthetic fibers. Products of Canada, within this provision of the HTSUSA, are eligible for a reduced rate of duty for purposes of the United States-Canada Free-Trade Agreement Implementation Act of 1988. The reduced rate of duty is 6.3 percent ad valorem and the applicable textile quota category is 659.

The subject entry did not liquidate by operation of law because liquidation was properly extended and Customs did, in fact, liquidate the entry within the additional year granted by the extension. Additionally, protestant has failed to rebut the presumption that proper notice of extension of liquidation was given.

As the rate of duty under the classification indicated above is the same as the rate under which the subject merchandise was entered, you are instructed to deny the protest in full. A copy of this decision should be furnished to the protestant with the Form 19 notice of action.

Sincerely,

John Durant, Director
Commercial Rulings Division

Previous Ruling Next Ruling

See also: