9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (12) TMI 1200 - AT - CustomsClassification of Optical Fibre Cables used in Telecommunication - exemption under Notification No. 20/2005 dt. 1.3.2005 - Held that - Since there are judgments of differing opinions, Our differing view is based to a significant extent on the Technical books/Literature, the benefit of which was not available to the bench in the case of Reliance Communications Infra Ltd case or in Optel Telecommunication Ltd. Therefore in our opinion, the matter needs to be referred to a Larger Bench of the CESTAT for resolving the dispute. At this stage we find that other issues such as confiscability and penalties would depend on the decision regarding classification. Therefore we do not propose to take a view on these issues till the larger question of classification is decided. - Registry is directed to place the matter before the Hon'ble President CESTAT for constitution of a Larger Bench to decide the following Question of Law which arises in the present case - Whether Optical Fibre Cables (OFC in short) imported by Vodafone Group of Companies and used in Telecommunication are classifiable under Customs Tariff Heading 8544 and eligible for exemption under Notification No. 20/2005 dt. 1.3.2005 or they would fall under Customs Tariff Heading 9001 leviable to basic Customs Duty at 10% under Notification No. 21/2002-Cus dt. 1.3.2002. Matter referred to larger bench.
Issues Involved:
1. Classification of Optical Fibre Cables (OFC) used in Telecommunication. 2. Eligibility for exemption under Notification No. 20/2005. 3. Levy of Basic Customs Duty under Notification No. 21/2002-Cus. 4. Validity of self-assessment and the right to appeal. 5. Confiscation and imposition of penalties. Detailed Analysis: 1. Classification of Optical Fibre Cables (OFC) Used in Telecommunication: The central issue is whether the imported OFC should be classified under Tariff Item 8544.70.90 or 9001.00.00. The appellant argued that the OFC consists of individually sheathed fibers, thus falling under Heading 8544. The technical literature and expert opinions presented by the appellant supported this claim, stating that the dual acrylate coating on each fiber acts as a sheath. The Revenue, however, relied on the opinion from the Telecommunication Engineering Centre (TEC) and past rulings, arguing that the OFC should be classified under Heading 9001 as the fibers were not individually sheathed but merely coated. 2. Eligibility for Exemption Under Notification No. 20/2005: The appellant contended that if the OFC is classified under Heading 8544, it would be eligible for exemption under Notification No. 20/2005. The Revenue opposed this by maintaining that the correct classification under Heading 9001 would not make the goods eligible for such exemption. 3. Levy of Basic Customs Duty Under Notification No. 21/2002-Cus: If classified under Heading 9001, the OFC would be subject to a 10% Basic Customs Duty under Notification No. 21/2002-Cus. The appellant argued against this classification, aiming to benefit from the lower duty applicable under Heading 8544. 4. Validity of Self-assessment and the Right to Appeal: The Revenue questioned whether the appellant could appeal against an assessment made by themselves. The Tribunal referred to the Hon'ble High Court of Mumbai's order, which vindicated the appellant's right to change the classification practice based on a previous favorable ruling by the Commissioner of Customs (A). The High Court held that the appellant's classification under Heading 8544 was justified and that the collection of differential duty by the DRI was unjustified. 5. Confiscation and Imposition of Penalties: The Revenue sought confiscation and penalties, arguing that the appellant's change in classification was unjustified. The Tribunal noted that these issues were secondary to the primary question of classification and would be decided based on the final classification ruling. Conclusion: The Tribunal, after examining the technical literature and expert opinions, found merit in the appellant's contention that the dual acrylate coating constitutes a sheath, thus classifying the OFC under Heading 8544. However, due to conflicting past rulings and the complex nature of the issue, the Tribunal decided to refer the matter to a Larger Bench of the CESTAT for a final decision on the classification. The issues of confiscation and penalties were deferred pending the Larger Bench's decision.
|
