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TMI Blog2017 (2) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... urity algorithms' valued Rs. 46,1068,611/- which were sought to be classified under heading 85235210 of the first schedule to the Customs Tariff act, 1975 as 'SIM modules'. Appellant also claimed exemption to 'nil' rate of duty under notification no.6/2006-CE dated 1st March 2006 at sl. No.22A i.e., 'recorded smart cards'. The goods under import admittedly are 'subscriber identity modules' (partially pre-recorded) (SIM) on reels and are loaded with operating system software and security algorithms. These modules are detached from the reels for embedding in plastic cards and for installing of personalization software such as, integrated certificate card identifier number, integrated mobile subscriber identity, authent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im card and that the only post-importation activity undertaken by them is to embed the module and personalize the card to suit the design provided by various mobile service providers. According to them, SIM modules imported in reels are, for all practical purposes, 'SIM cards'. It was also contended that 'SIM cards' being 'smart cards' are classifiable under heading 8523 of the First Schedule to the Customs Tariff Act, 1975 and the schedule to the Central Excise Tariff act, 1975. 5. Leaned authorised representative contends that the imports are not cards as they are not mounted on plastic of the prescribed size at the time of import. It was also argued that the said item is not usable as a card without embedding and persona ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... technology the gauge of the encapsulation to be very narrow. On an appropriate phone, the 'SIM' as imported may be usable without any further embedding. Embedding is undertaken to provide some rigidity and thus render it easy to carry and store till is inserted into the handset. It does not add to the 'SIM' except that it affords the service provider space to print the logo of the company and distinctive identity numbers. The usage of the expression 'card' in conjunction with 'SIM', contrary to the submissions of the authorised representative, merely denotes the physical appearance of the 'integrated circuit' loaded with the operational software. This would be its nomenclature with or without embedding in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specific domain of mobile telephony and, therefore, is a special kind of 'smart card' was also relied upon. A further clarification received from Indian Institute of Technology, Madras on 7th February 2008 that the sample examined by them cannot be used without loading of necessary software to render it compliance with GSM Phase-Il standard and that the sample is a piece of hardware without any software loaded on it. Further, the opinion of M/s. Indian Telephone Industries Ltd, Palakkad in which it is stated that embedding in a plastic card body and further personalization are necessary for making the sample as a 'smart card' is relied on. According to Revenue all these aspects render the SIM to be other than 'smart cards' and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el that imports effected at Air Cargo Complex, Bengaluru were being cleared under heading 8523 and had not been subject to any challenge by Revenue. It is also further contended that the SIM in reels is without doubt a SIM, even if partially recorded, and, for the purposes of classification, should be considered as a SIM under Rule 2(a) of the General Interpretative Rules. 12. 'Smart cards' contain authentication and recognition software which may, either in conjunction with the card or in contactless form, perform its function. 'SIM cards' are connected to the appropriate slots in a mobile device and using the radio frequency of the device enables the device to communicate with the operating mechanism of the mobile service pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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