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TMI Blog2009 (1) TMI 269X X X X Extracts X X X X X X X X Extracts X X X X ..... s' & other items Vide the above 10-Bills of entry, a total of 34000 sets of the above items were imported. 2.1 Similarly, during January 2004, UTL imported certain goods from M/s. Nissho Iwai Corporation, Japan for the clearance of which they filed 4 Bills of entry at the ICD Bangalore, as detailed in Annexure IB to show cause notice. In the bills of entry and the import invoices, the goods were described overall as "Parts, components & accessories of mobile handsets Model DX22B", followed by further item-wise description viz., Front Case Assembly Key Pad Antenna Back case assembly and main PCB assembly Screws & other items Rubber Battery, and Strap Vide the above 4 Bills of entry, a total of 45167 sets of the above items were imported. 2.2 In all the aforesaid 14 Bills of entry, the importer claimed the classification of goods under CTH 85259090 which applies to parts suitable for use solely or principally with the apparatus of headings 8525 to 8528. They also claimed full exemption from payment of Customs Duty under Sl. No. 320 of Customs Notification 21/2002-Cus., dated 1-3-2002, as amended from time to time, read with condition No. 5 thereto. The said Sl. No. 320 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... porter had actually imported complete Cellular Phones/Mobile handsets in disassembled/unassembled condition and had fraudulently availed the duty exemption by deliberately mis-declaring the same as Parts, Components and Accessories of Cellular Phones; Mobile handsets with an intention to misclassify the goods and to evade the Customs Duties otherwise chargeable on complete Cellular Phones/Mobile handsets vide Sl. No. 313 of the aforesaid Notification. On a simultaneous perusal of the various bills of entry (which had earlier been assessed by different officers and cleared at different times during the period from May 2003 to January 2004) and related import documents, it appeared that complete Cellular Phones/Mobile handsets had been imported in disassembled/unassembled condition in SKD/CKD packs. It also appeared that the "components" imported, even though presented in unassembled/disassembled form, had the essential character of being complete Mobile/Cellular Phones in terms of Rule 2 (a) of the General Rules for the Interpretation of First Schedule to the Customs Tariff Act, 1975. 3. Subsequent to such investigation carried out by the authorities, the lower authorities issued s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... our attention to the Notification No. 21/2002-Cus., dated 1-3-2002 more specifically to Sl. Nos. 315 and 320 of the said Notification. He would submit that the said Notification specifically covers the parts, components and accessories of mobile phones including cellular phones and he would also draw our attention to Condition No. 5, which according to him has been fulfilled by the appellants. He would also draw our attention to the provisions of Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 and submit that they have strictly adhered to the said rules before import of such consignments. He would submit that the appellants had imported parts, components and accessories of mobile handsets commonly known as CDMA handsets. It is his submission that the appellants in their factory assembled the entire parts and components into mobile handsets and loaded each handset with a software making it a 'CDMA' mobile handset. He would submit that the mobile handset comes into existence in the 'factory premises' only after loading of software in the said handsets. He would draw our attention to the case of LG Electronics India Pvt. Ltd. v. CC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is correct and the finding needs to be upheld. 6. In the rejoinder, the learned counsel would draw our attention to the Page 163 and 505 of the Order-in-Original to show that there was a letter from the supplier agreeing to the proposition made by the appellants and hence, there cannot be any loading of freight charges. 7. We have considered the submissions made at length by both sides and perused the records. The question which arises before us today is whether the parts, components and accessories of mobile handsets and cellular phones imported by the appellants would get the benefit of Notification No 21/2002-Cus. (as enumerated at 320) or whether they are to be considered as complete handsets and falling under Chapter Heading No. 8525 2017 as import of complete handsets in CKD form. The second issue which arises for consideration also is whether the valuation has to be loaded with the freight charges in respect of consignments which were renegotiated as CIF from FOB. 7.1 We first take up the issue whether the appellant is eligible for the benefit of Notification No. 21/2002-Cus. or not. It is undisputed that the appellants had imported parts/components and accessories of mob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ics India Pvt. Ltd. (supra). The facts of that case and the ratio are reproduced below : "Brief Facts The appellants in this case have imported parts and accessories of mobile phones which were classified by them under Chapter Heading 852990.90 and claimed benefit of exemption under Notification No. 21/2002-Cus., dated 1-3-2002 which exempts parts, components and accessories of mobile handsets including cellular phones falling under Ch. Heading 852990.90 or any other chapter from duty if the importer follows the procedure set out in the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996. These parts were imported under two different bill of entries but on examination it was found that when items covered under both bill of entries are combined together they form 12000 pcs. complete mobile phones in semi-knocked down condition. It further came to notice that the purchase order placed by the appellants with the supplier was for mobile phones in SKD condition and not individual parts. In terms of Rule 2(a) of the General Rules of Interpretation in the First Schedule of the Customs Tariff "Any reference in a heading to an article shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 21/2002-Cus. was given to the assessee. Aggrieved, by this order of the Tribunal, the revenue preferred a Civil Appeal No. D/3325/06 before the Hon'ble Supreme Court. The Hon'ble Supreme Court while dismissing the appeal passed the following order. "Delay condoned On the facts, we see no reason to interfere in this matter. The appeal is dismissed." The above said order has been reproduced at 2007 (211) E.L.T. A45 (S.C.). 7.4 We find that the issue involved in the case of LG Electronics India Pvt. Ltd. (supra) and the issue involved in the case before us is identical and on interpretation of the very same Notification, in respect of the same goods. Respectfully, following the same? we hold that the impugned order is liable to be set aside. 7.5 As regards the contention raised by the learned SDR that the decision of the Hon'ble Supreme Court in the case of Maestro Motors Ltd. (supra) would cover the situation like this. We find that in the case of Maestro Motors Ltd. (supra), Hon'ble Supreme Court held as under : "Thus as per this Interpretative Rule, even though an article is incomplete or unfinished when it is presented for clearance, if that article has the essential char ..... X X X X Extracts X X X X X X X X Extracts X X X X
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