9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (10) TMI 392 - AT - CustomsClassification of the goods described in the Bills of Entry - eNodeB BTS/Micro Cell BTS/Femto Cells BTS/Pico Cells BTS - eNodeB, would be a Base Station in the 4G network? - Mis-declaration of goods or not - Whether the goods classifiable under CTH 8517 61 00, which is specific for Base Stations or whether the goods are classifiable under the residuary CTH 8517 62 90 for Other ? - extended period of limitation - HELD THAT - It is seen that eNodeB is an evolved Base station of 4G Technology, which does not have the drawback of the Base Stations of 2G and 3G technology of having to communicate via a separate Controller owing to inability to communicate directly, which results in slowing down the speed of the connection. In that sense, the Base Stations of 4G Technology (digital signals) are at par with the Base Stations of 1G Technology (analog signals) in the sense that Handover in both takes place at the Base Stations itself and not via a separate Controller. Merely because the Base Stations of 4G LTE have overcome the aforesaid drawback of the Base Stations of 2G and 3G technology, it cannot mean that eNodeB is not a Base Station. It cannot, therefore, be said that Base Stations of 4G technology cannot be called Base Stations because unlike Base Stations of 2G technology and 3G technology, it does not require a separate Controller - it cannot be urged that the Base Station of 4G technology is not a Base Station and cannot be classified under CTH 8517 61 00, which is specifically for Base Stations . The contention of the Department that the scope of CTH 8517 61 00 must be restricted and confined only to be Base Stations of the earlier 2G technology and 3G technology and that the said entry cannot cover an evolved Base Station of the new 4G technology cannot be accepted in view of the decision of the Supreme Court in COLLECTOR OF CUSTOMS CENTRAL EX. VERSUS LEKHRAJ JESSUMAL SONS 1996 (2) TMI 135 - SUPREME COURT . The Supreme Court held that a Tariff entry cannot be given a static interpretation ignoring the evolution in technology. A perusal of Serial No. 372 (i) of the Notification dated 17.03.2012 would show that it grants exemption from the whole of customs duty of goods specified in List 17 required inter alia for cellular mobile telephone service. The said exemption is subject to condition no. 52, which requires that the importer should be licensed by the Department of Telecommunications of the Government of India for providing cellular mobile telephone service. There is no dispute that Reliance Jio satisfies condition no. 52. List 17 mentions Base Transceiver Stations at Serial No. 3(a) and Base Station Controllers at Serial No. 1(b). The said Notification was amended on 01.03.2016, by which in Serial No. 372 an insertion was made to the effect that notwithstanding anything contained in List 17, exemption shall not apply to specified goods of Heading 85.17, which, amongst others, included Long Term Evolution Products. Extended period of limitation - HELD THAT - The assessment done by the importer under section 17(1) of the Customs Act is not conclusive but is subject to verification by the proper Officer under section 17(2) of the Central Act. If the proper Officer finds that self-assessment is incorrect, the proper Officer has to re-assess the goods under section 17(4) of the Customs Act. There is nothing on the record which may indicate that the proper Officer did not accept the self-assessment and carried out the re-assessment. Thus, also the benefit of the extended period of limitation could not have been invoked. The goods deserve to be classified under CTH 8517 61 00 as contended by Reliance Jio and not under CTH 8517 62 90 as contended by the Department. The impugned order dated 14.06.2019 passed by the Commissioner, therefore, to the extent it classifies the goods under CTH 8517 62 90 and consequential demand of differential duty w.e.f. 01.03.2016, cannot be sustained and is set aside - appeal allowed - decided in favor of appellant.
Issues Involved:
1. Classification of goods under Customs Tariff Heading (CTH) 8517 61 00 versus CTH 8517 62 90. 2. Applicability of the extended period of limitation under Section 28(4) of the Customs Act. 3. Eligibility for exemption under Notification dated 17.03.2012 versus Notification dated 01.03.2005. Detailed Analysis: Issue 1: Classification of Goods The primary issue was whether the goods described as eNodeB BTS/Micro Cell BTS/Femto Cells BTS/Pico Cells BTS should be classified under CTH 8517 61 00 (specific for 'Base Stations') or CTH 8517 62 90 (residuary sub-heading for 'Other'). - Reliance Jio's Argument: - eNodeB and similar equipment are 'Base Stations' in the 4G LTE network, which communicate with User Equipment. - Every cellular network, including 4G, must have a Base Station, and eNodeB serves this purpose. - A tariff entry should not be interpreted statically, ignoring technological evolution. This was supported by the Supreme Court's decision in Collector of Customs & Central Excise vs. Lekhraj Jessumal & Sons. - The classification of eNodeB should consider its primary function as a 'Base Station' under CTH 8517 61 00. - Department's Argument: - eNodeB performs additional functions beyond traditional 'Base Stations', such as routing and conversion, and should be classified under CTH 8517 62 90. - The Harmonized System of Nomenclature (HSN) defines 'Base Stations' narrowly, and eNodeB's advanced functionalities place it outside this definition. - Even if eNodeB could be classified under both headings, it should fall under the residuary sub-heading 8517 62 90 as per the General Rules for the Interpretation of Import Tariff. - Tribunal's Findings: - A 'Base Station' is a fixed equipment in the cellular network that communicates with user equipment, covering a geographical area called a 'cell'. - The 4G technology's eNodeB is an evolved Base Station, overcoming the drawbacks of 2G and 3G technologies. - The Tribunal rejected the static interpretation of tariff entries, emphasizing technological evolution. - The Tribunal concluded that eNodeB should be classified under CTH 8517 61 00, as it functions as a 'Base Station' in the 4G LTE network. Issue 2: Extended Period of Limitation The Department contended that the extended period of limitation under Section 28(4) of the Customs Act was applicable due to alleged mis-declaration by Reliance Jio. - Reliance Jio's Argument: - The goods were correctly described in the Bills of Entry, and classification is a matter of belief. - The extended period of limitation requires evidence of collusion, willful mis-statement, or suppression of facts, which was not present. - Many Bills of Entry were assessed by officers, some after physical examination, negating the claim of mis-declaration. - Department's Argument: - Post-2011, self-assessment of duty by importers under Section 17 of the Customs Act implies that any disagreement by the Department amounts to mis-declaration. - Tribunal's Findings: - The Tribunal found no evidence of collusion, willful mis-statement, or suppression of facts. - The self-assessment by importers is subject to verification by proper officers, who did not find the self-assessment incorrect. - The extended period of limitation could not be invoked, and the Tribunal upheld the Commissioner's decision on this point. Issue 3: Eligibility for Exemption The issue was whether the goods were eligible for exemption under Notification dated 17.03.2012 or should be governed by Notification dated 01.03.2005, as amended. - Reliance Jio's Argument: - The goods were eligible for exemption under Notification dated 17.03.2012, which listed 'Base Transceiver Stations' and 'Base Station Controllers'. - The amendment on 01.03.2016 excluded LTE products from the exemption, indicating that prior to this date, LTE products were eligible. - Department's Argument: - The Notification dated 01.03.2005, as amended on 11.07.2014, excluded LTE products from exemption, and this should apply. - Tribunal's Findings: - The Tribunal found that the Notification dated 17.03.2012 granted exemption to goods listed in List 17, which included 'Base Transceiver Stations'. - The amendment on 01.03.2016 specifically excluded LTE products, implying that prior to this date, LTE products were eligible for exemption. - The Tribunal upheld the Commissioner's decision that the goods were eligible for exemption under Notification dated 17.03.2012. Conclusion: The Tribunal concluded that the goods should be classified under CTH 8517 61 00 as 'Base Stations', the extended period of limitation under Section 28(4) of the Customs Act was not applicable, and the goods were eligible for exemption under Notification dated 17.03.2012. Consequently, the appeal by Reliance Jio was allowed, and the appeal by the Department was dismissed.
|
