Commissioner of Customs Vs Redington (India) Limited (CESTAT Delhi)
CESTAT Delhi held that Wireless Access Points which works on technology and doesn’t support LTE is exempted from whole of customs duty under serial 13(iv) of the notification dated 01.03.2005.
Facts- Revenue has preferred the present appeal contesting against order passed by the Additional Director General (Adjudication), Directorate of Revenue Intelligence, New Delhi, holding that Wireless Access Points/ MIMO Product (products having MIMO Technology) imported by M/s. Redington (India) Limited would be classifiable under Customs Tariff Item 8517 62 90 and accordingly would be entitled to exemption from Basic Customs Duty under the notification dated 01.03.2005, as amended by the notification dated 11.07.2014. The demand of customs duty for the period from 11.07.2014 to 30.06.2017 has, therefore, been dropped.
Conclusion- A Division Bench of the Tribunal in Ingram Micro India confirmed the classification of identical product (i.e. WAP) under CTI 8517 62 90 and extended the benefit of the subsequent notification dated 30.07.2017. The Department has accepted the Order passed by the Tribunal. Therefore, once the benefit has been granted to Ingram Micro in the subsequent notification for an identical product, the benefit under the notification dated 01.03.2005, as amended on 11.07.2014 should also be extended to Redington.
Held that WAP imported by the appellant works on technology and does not support LTE standard. Beetal Teletech was, therefore, justified in claiming exemption from the whole of the customs duty under Serial 13 (iv) of the notification. There is, therefore, no infirmity in the order dated 29.11.2019 passed by the Additional Director.
FULL TEXT OF THE CESTAT DELHI ORDER
The Commissioner of Customs (Air) Chennai-VII Comminssionerate1 has filed this appeal to assail the order dated 29.11.2019 passed by the Additional Director General (Adjudication), Directorate of Revenue Intelligence, New Delhi2, holding that Wireless Access Points3/ MIMO Product (products having MIMO Technology) imported by M/s. Redington (India) Limited 4 would be classifiable under Customs Tariff Item5 8517 62 90 and accordingly would be entitled to exemption from Basic Customs Duty6 under the notification dated 01.03.2005, as amended by the notification dated 11.07.2014. The demand of customs duty for the period from 11.07.2014 to 30.06.2017 has, therefore, been dropped. The penalty imposed upon Redington as also its Director E.H. Kasturi Rangan have also been dropped.
2. Redington is a distributor of Information Technology products. It imported WAP from various suppliers such as Cisco Systems International US, Ubiquit Networks International, Hong Kong and M/s. Fortinet Singapore Private Limited, Singapore for trading purpose in India and it classified the imported WAP under CTI 8517 62 90 during the period 11.07.2014 to 30.06.2017. According to the appellant, WAP works on Multiple Input/Multiple Output7 technology, but does not support Long Term Evolution8
3. It would, therefore, be necessary to state briefly about WAP, MIMO and LTE:
(i) WAP: It is a networking device used for wireless communication within the Local Area Network9. It helps in connecting wireless enabled devices such as Laptops, Smartphone, Tablets etc., to a wired network;
(ii) MIMO: It is a technology wherein multiple antennas are used simultaneously for transmission and multiple antennas are used simultaneously for reception;
(iii) LTE: In telecommunication, it is a standard for high speed cellular communication for mobile devices and data terminals. It increases the capacity and speed using a different radio interface together with core network improvements.
4. The issue in this appeal pertains to the availability of exemption from the whole of the customs duty by Beetal Teletech under Serial No. 13 of the notification dated 01.03.2005, as amended by notification dated 11.07.2014. The relevant Serial No. 13, as it stood during the relevant period, is as follows:
“Exemption to goods of specific heading, from customs duty (ITA Bound). – 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 of the description as specified in column (3) of the Table below and falling under the heading, sub-heading or tariff-item of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as specified in the corresponding entry in column (2) of the said Table when imported into India, from the whole of the duty of customs leviable thereon under the said First Schedule, namely:-
