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TMI Blog2025 (4) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... ssue that arises in the present petition is in respect of the interpretation of the word 'and' appearing in the clause (iv) of Serial No. 13 of Notification No. 11/2014-Customs dated 11th July, 2014, i.e., "Multiple Input/ Multiple Output (MIMO) and Long Term Evolution (LTE) Products'. The CESTAT vide the impugned order has interpreted the said terms i.e., MIMO and LTE in conjunction and thereby, held that the subject goods would not be covered in the exclusion clause of the exemption notification. 5. The background of the case is that a Notification was issued bearing No. 24/2005 by the Customs Department dated 1st March, 2005 in which exemptions were granted for basic customs duty for products falling under Chapter Heading '8517'. The said entry reads as under: Notification No. 24/005-Customs New Delhi, dated the 1st March,2005 10 Phalguna, 1926 (Saka) G.S.R. No. (E) .-In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the following goods, falling under the heading, sub-heading or tariff-item ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Optical Transport Product or Switch (POTP or POTS), Optical Transport Network (OTN) products, and IP Radios; (iii) Carrier Ethernet Switch, Packet Transport Node (PTN) products, Multiprotocol Label Switching-Transport Profile (MPLS-TP) products; (iv) Multiple Input / Multiple Output (MIMO) and Long Term Evolution (LTE) Products.'. (b) after serial number 39 and the entries relating thereto, the following serial number and the entries shall be inserted, namely :- "40 All chapters All goods for the manufacture of following goods, namely :- (i) soft switches and Voice over Internet Protocol (VOIP) equipment, namely, VoIP phones, media gateways, gateway controllers and session border controllers; (ii) optical transport equipments, combination of one or more of Packet Optical Transport Product or Switch (POTP or POTS), Optical Transport Network(OTN) products, and IP Radios; (iii) Carrier Ethernet Switch, Packet Transport Node (PTN) products, Multiprotocol Label Switching-Transport Profile (MPLS-TP) products; (iv) Multiple Input / Multiple Output (MIMO) and Long Term Evolution (LTE) Products: provided that the importer follows the procedure set out in the Customs (Imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed this appeal to assail the order dated 17.12.2019 passed by the Additional Director General (Adjudication), Directorate of Revenue Intelligence, New Delhi allowing exemption from payment of basic customs duty and, therefore, dropping the demand raised in the show cause notice dated 27.11.2018. 2. M/s Compuage Infocom Ltd. is engaged in the business of distribution and trading of Information Trading products and peripherals. Respondent had imported "Wireless Access Points/MIMO products' falling under Customs Tariff Item 8517 62 90, by claiming benefit of Notification dated 01.03.2005, as amended by Notification dated 11.07.2014. The view of the department is that the MIMO products, whether or not incorporating LTE technology are not entitled for benefit of the said Notification. Consequently, a show cause notice dated 27.11.2018 was issued calling upon the respondent to re-classify the subject products under CTI 8517 62 90 and for denial of the benefit of the Notification dated 11.07.2014. 3. The Additional Director General passed a detailed order dropping the proposals made in the show cause notice dated 27.11.2018. The department has filed this appeal to assail the aforesaid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... products which work on both MIMO technology and LTE standard. 45. The interpretation advanced by the Revenue is that the phrase "MIMO and LTE Products' includes three categories - (i) products using MIMO but not LTE, (ii) products using LTE but not MIMO, and (iii) products using both MIMO and LTE. In the written submissions filed on behalf of the Revenue, it has been asserted that the grammatically, the only possible way to fulfil this intention was to add the word 'and' between 'MIMO' and 'LTE' and then suffix the term 'products' after 'MIMO and LTE' as the same would have the meaning of 'MIMO product and LTE product'. 46. However, in our opinion, the aforesaid contention is unmerited. If the intention of the Central Government was to include products utilizing either MIMO technology or LTE standard or both, the phrase 'MIMO or LTE Products' could have been used. The use of the conjunction 'or' would have naturally encompassed all products with either of the two technologies/standards, and also those products which combine both. There would have been no need to use 'and' in place of 'or' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure' 53. In the present case, there is no such ambiguity or absurdity. In our view, when all the four entries of Serial No. 13 are analysed, it would lead to only one conclusion that the word "and' is to be read in conjunctive manner only, and the phrase "MIMO and LTE Products' would refer to only those products which have both MIMO technology and LTE standard. 54. As far as the argument of the Revenue that in the year 2021, the Notification No. 25/2005, and one Notification No. 57/2017-Customs were amended and the phrase "MIMO and LTE Products' were substituted with (i) MIMO products; (ii) LTE products', and that these amendments were clarificatory in nature, is concerned, notably, an amendment in the Notification No. 57/2017-Customs was brought vide Finance Act, 2021 which is clarificatory in nature, and, clarifies Serial No. 20 of the said notification. It states that the subject entry will now be read as (i) MIMO products; (ii) LTE products. Similar change was brought in Notification No. 25/2005 by virtue of Notification No. 05/2021-Customs. 55. Thus it is clear that the aforesaid amended entries in the concerned Notifications, in their clarificatory form, will be appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Therefore, as a common rule of English language, the word 'and' would clearly, and in unambiguous terms, be read conjunctively. 60. To reiterate, the amendments as discussed above were introduced in the year 2021, whereby "MIMO and LTE products' were changed to "(i) MIMO products; (ii) LTE products'. The word 'and' has been totally taken out from the new entry and the same is absent from the entry altogether. The absence of word 'and' between the word 'MIMO' and 'LTE', as it existed prior to the amendment brought as clarification, rather speaks and explains by its absence, about the presence of intention to read 'MIMO' and 'LTE' as conjunctive and not disjunctive. 61. In light of the above, we hold that the phrase "MIMO and LTE Products' in Serial No. 13 (iv) of the amended Notification No. 24/2005 applies solely to products combining MIMO technology and LTE standards. The exclusion clause cannot be stretched to encompass products featuring either one of the two technologies. Accordingly, the WAPs imported by the respondent, which employ MIMO technology but not the LTE standards, are entitled to the exemption from Basic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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