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Issues:
Classification of Set Top Boxes under Tariff Item 85.28 or 8517.80. Analysis: The appeal centered around the classification of Set Top Boxes imported by the appellant. The appellant argued for classification under 8517.80, citing the Information Technology Agreement (ITA) and ITC(HS) classification. The customs authorities, however, classified the goods under Tariff Item 85.28. The adjudicating and appellate authorities upheld this classification, leading to the appellant's appeal. The appellant imported Interactive Set Top Boxes SB 2200, contending they should be classified under 8517.80 due to their communication function covered by the ITA. Set top boxes are used with television receivers for internet access and various applications like E-Mail, Internet browsing, etc. The adjudicating authority viewed the goods as microprocessor devices with a modem for internet access, classifying them under 8543.89. The Commissioner (Appeals) considered the goods akin to decoders for digital video broadcasting under 85.28, emphasizing the main function as decoding despite additional features like an internal modem. The appellant argued contradictory findings by the lower authorities on the nature of the imported goods. The relevant Tariff Schedule entries were scrutinized, with the appellant asserting that set top boxes' classification should align with the ITA and the new 8-digit Tariff classification effective from 1-3-2003. The Tribunal deliberated on the appellant's contentions, emphasizing the set top boxes' functionality, connectivity, and the ITA's coverage of such devices under 8517.80. Noting the commitment to reduce tariffs on set top boxes under the ITA, the Tribunal ruled in favor of classifying the imported set top boxes under 8517.80, overturning the previous classification under 8543.89. In conclusion, the Tribunal set aside the impugned order, allowing the appeal and determining the correct classification of the set top boxes under Tariff Item 8517.80.
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