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2018 (12) TMI 172

Classification of imported goods - Encoder / Multiplexer / Modulator - whether classified under CTH 8517 or under CTH 8528 of CTA? - Held that:- In the instant case, it is an undisputed fact that the items in question, i.e. Encoders, Multiplexers, Modulators, are having individual functions. It is found that each of these products is having independent functions and are used for various purposes for transmission of data. - The Appellants are selling these goods not only to TV Cable operator .....

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As the impugned goods are having the function of transmission of data and other functions and hence the same would merit classification under CTH 8517 - appeal allowed - decided in favor of appellant. - Appeal No. C/11809/2018-DB - A/12699/2018 - Dated:- 3-12-2018 - MR. RAMESH NAIR, MEMBER (JUDICIAL) And MR. RAJU, MEMBER (TECHNICAL) For Appellant: Shri H. D. Dave (Advocate) For Respondent: Shri J. Nagori (A.R.) ORDER Per: Ramesh Nair The present appeal has been filed against Order-in-Original No .....

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on industry term for a combination of television signal transmission apparatus and is in dividually configured as per the set specifications for every particular customer. It receives satellite television signals and after modification, transmits the signal into a cable television. All the products area dressed as COPE/ Digital Head-end items for the purpose of trading/ marketing. Thus the head-end serves as integral function in the cable TV Transmission chain. Head-end contains combinations con .....

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5.28 refers to reception apparatus for television, whether or not incorporating radio - broadcast receivers or sound or video recording apparatus, for the display of signals (televisions sets) and (2) Apparatus for reception of television signals, without display capabilities (e.g. receivers for satellite television broadcasts). These apparatus receive signals and convert them into a signal suitable for display. Thus the classification under CTH 85287390 is correct. 2. Shri H.D. Dave, Ld. Counse .....

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eption apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus. - Reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus. 8528.71 - Not designed to incorporate a video display or screen 8528.72- Other, colour 8528.73 - Other, monochrome He submits that the goods in question being equipment for conversion and compression (coding) ar .....

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tus. The contention of the Adjudicating authority that MPEG-4 and MPEG-2 are used by encoders only for broadcast of television application is totally erroneous as it can be used for multiple applications and services. He relies upon excerpts from ITU-T MPEG-2 and MPEG - 4 A as below: Intro.2: Application The applications of this specification cover, but are not limited to, such areas as listed below: BSS: Broadcasting Satellite Service (to the home) CATV Cable TV Distribution on optical networks .....

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ication of the goods has to be decided on the basis of its condition at the time of importation and not after its use in the manufacture of some other products. They are manufacturers of goods and many a time, the imported goods are used in manufacture and process further to convert or make them into usable commodity like the digital head-end sub-system equipment (DHE) and many more for use in cable satellite or any other net work. The equipments in question are essentially used as data conversi .....

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sion equipments including telecommunication and internet protocol services which are, therefore, only classifiable in Chapter 8517. The explanatory note to Chapter 8517 clearly mentions that where the different apparatus are essentially performing the function as a combination of machines to the principal function of Chapter 8517, then they are to be solely classified there-under only and not under any other chapter. 2. Subject to Note I to this Section Note I to Chapter 84 and to Note I to Chap .....

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it classification under Chapter 8517 and cannot be constricted to narrowly confine to Chapter 8528 since they are not any kind of reception apparatus of television much less apparatus for reception. He draws our attention to the imports of similar goods wherein the goods have been imported from year 2011 to 2018 including that of satellite TV and cable service industry in Chapter 8517. He submits that the impugned goods being imported all over the country through different Custom Houses are clas .....

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jeroLogix - 2014 (303) ELT 565 (Tri, Del) (x) Comm. Vs. Samsung India Elec.P.Ltd 2016 (340) ELT 430 (AAR) (xi) Logic India Trading Co. v/s Comm.- 2016(337)ELT - 65 (Tri, Bang) (xii) C. Net Communications (I) Pvt Ltd. V/s Commr. of Cus. (Import), Mumbai - 2004 (170) ELT 446 (Tri, Del) (xiii) Commr. V/s Fibcom India Ltd - 2003(152)ELT 108 (Tri, Del) (xiv) HCL Comnet Systems & Services Ltd v/s Commr-2002 (139) ELT 304 (Tri, Del) 4. On the other hand Shri. Jeetesh Nagori, Ld. Additional Commissi .....

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ignal into a cable television. Thus, the head-end serves as integral function in the cable TV television chain. Head-end contains combinations, converters, signal processors / generators, combiners, scramblers, amplifiers, modulators / demodulators and receivers. The receiver / descramblers are used in cable television application for receiving, de-coding and re-transmitting television signals. The receiver / descrambler decodes for further transmission, reception and subsequent display. 5. In t .....

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t receivers or sound or video recording or reproducing apparatus. The Explanatory notes to the Harmonised System of Nomenclature for CTH 85.28 says that the heading includes (1) Television reception apparatus, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus for the display of signals (television sets) and (2) Apparatus for the reception of television signals, without display capabilities. These apparatus receive signals and convert them .....

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tral Board of Excise & Customs, New Delhi with the approval of the Member (Customs) informed under their letter F.No. 528/02/2018-STO (TU) dated 10.4.2018 that the subject WCO ruling had been examined in the Board and the said ruling has not been accepted by the Board. Therefore, it is considerably clear that the classification recommendations made by the WCO‟s Committee have not been accepted by the Central Board of Excise & Customs for the products namely encoders, modulators and .....

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entries involved in this case are 85.17 and 85.28, which reads, as under:- 8517 - Telephone sets, including telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide are networks), other than transmission or reception apparatus of heading 84.43, 85.25, 85.27 or 85.28. - Other apparatus for transmission or reception .....

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transmission of signals for television transmission. We find that the CTH 85.17 covers other apparatus for the transmission or reception of voice, images or other data, including apparatus for communication in wired or wireless network (such as local or wide network) other than transmission or reception apparatus of heading 84.43, 85.25, 85.27 or 85.28 . In 85.17 6270, the items multiplex, statistical multiplex and under sub-heading 8517 6290, other items are covered. The heading 8528 7390, i.e .....

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echnology & Software industry), Hathway Cable Datacom (Cable & Broadband Network service provider), Broadband (Internet service provider). We find that these products are used for conversion and compression (coding) used for conversion of signals as apparatus for transmission at transmission site for both wired and wireless networks (WAN & LAN). The goods are not used at subscribers end as reception apparatus for television. The adjudicating authority has over-looked this aspect whil .....

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der are reproduced below :- 3.5 I also find that the impugned goods are specially for transmission purpose and not for one to one communication. The device is essentially a standalone piece which is between frontend (camera, etc.,) and back end (studio). Essentially the equipment is meant for transmission of live video between the field reporter and studio. The signal is captured by devices such as cameras (not part of this equipment), which get relayed to the studio with this device with the he .....

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lace and is not capable of transmitting the signals which can be received by general public cannot be called broadcast equipment. What is covered under Heading No. 8525 50 10 and 8525 50 20 are the transmitter which can transmit radio or TV programme intended for reception by public and it is such equipment which are restricted for import. Since the equipment imported cannot transmit the signals for reception by general public but is meant only for transmitting the audio or video signals by a re .....

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e per-dominant character of the satellite receiver is to receive the signals and then transmit. He has taken us through the product manual of the respondent from which he has tried to demonstrate that primary function of the goods in question is to receive the signals. Para 3. We are not in agreement with the aforesaid submission of the learned counsel for the Revenue. A reading of Entry 85.28, under which the Revenue wants the product to be included, would show that it pertains to only those ap .....

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with no function as transmission apparatus. Para 5. This appeal is accordingly dismissed. Para 6. The excess duty paid by the respondent, if any, shall be refunded in accordance with law. Similarly, in case of CC (Import), Air Cargo Complex, Mumbai Vs. Indelox Services Pvt. Ltd - 2017 (357) ELT 946 (Tri, Mum), the Tribunal has held that if the device is having function of transmitting data through network from one server to other and has function of security for the data transmitted, the same w .....

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s and inappropriate content is blocked, while useful content is allowed to pass through. Therefore impugned goods act as a security device in a network and it protects the network from external malicious threats. It is not the case of the department that the impugned goods can function on its own without being connected to any network. Therefore the impugned goods are specially designed with a special purpose for use in a network and it cannot be for general use. Further Rule 3 of the Classifica .....

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s public switched telephone networks, Local Area Networks (LAN); Metropolitan Area Networks (MAN) and Wide Area Networks (WAN), whether proprietary or open architecture. This group includes: (1) Network interface cards (e.g., Ethernet interface cards). (2) Modems (combined modulators-demodulators). (3) Routers, bridges, hubs, repeaters and channel to channel adaptors, (4) Multiplexers and related line equipment (e.g., transmitters, receivers or electro-optical converters). (5) Codecs (data compr .....

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ed under the Network Interface Card, therefore, it was classifiable under CTH 8517. Para 5. On the submissions of the learned Counsel, based on various authorities, we find that the product is a Gateway Security Device. It has the function of transmitting the data through Network from one server to other and it has function of security for the data transmitted. Since the product has feature of transmission of data, it merits classification under the communication apparatus i.e. under CTH 8517. H .....

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