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TMI Blog2025 (1) TMI 859X X X X Extracts X X X X X X X X Extracts X X X X ..... rt in order dated 09.05.2024, while framing the question of law, which is set out below: Whether the word "and" as appearing in CTI 8517 (iv) is to be read in a disjunctive manner and thus be viewed as referring to separate products? FACTUAL BACKGROUND 3. The facts, as discernible from the records, are that the respondent, M/s Redington (India) Limited [hereafter also referred to as 'the respondent'], is a distributor of Information Technology products in India. During the period July, 2014 to June, 2017, the respondent imported Wireless Access Points (WAPs) from various suppliers, including M/s. Cisco Systems International, M/s. Fortinet Singapore Private Limited, and others. These WAPs, which utilize Multiple Input/Multiple Output (MIMO) technology, were used for wireless communication within Local Area Networks (LANs) by connecting wireless-enabled devices like laptops, smartphones, and tablets to wired networks. 4. Under the Customs Tariff Act, 1975, these imported WAPs were classified under Customs Tariff Heading (CTH) 8517, and particularly Custom Tariff Item (CTI) 8517 62 90. A table, setting out the nomenclature of these headings and items, is as under: 8517 Telephon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9031,41,00 5. All goods for the manufacture of goods covered by S.Nos. 1 to 4 above, provided that 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. [F.N0334/1/2005-TRU] 6. The aforesaid notification was amended by Notification No. 11/2014-Cus. dated 11.07.2014 [hereafter 'Notification No. 11/2014']. The relevant portion of Notification No. 24/2005, as amended by Notification No. 11/2014 [hereafter 'amended Notification No. 24/2005] pertaining to CTH 8517 is extracted below: Sr.No. Heading, sub-heading or tariff item Description x x x 13 8517 All goods, except the following :- (i) soft switches and Voice over Internet Protocol (VoiP) equipment, namely, VolP 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 (MPL5-TP) products; (iv) Multiple In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imilar notice was also issued to the respondent's director, Mr. E. H. Kasturi Rangan, proposing penalties for his alleged role in the claimed exemption. 11. However, the Additional Director General (Adjudication) [hereafter 'the Adjudicating Authority'], vide its Order-in-Original dated 29.11.2019, adjudicated the SCN in favor of the respondent. The Adjudicating Authority held that the WAPs imported by the respondent, which solely utilized the MIMO technology, were eligible for exemption under the amended Notification No. 24/2005. It observed that the language of the exclusion clause was clear and unambiguous, and the phrase "MIMO and LTE products" referred exclusively to products that used both the technologies together. The Adjudicating Authority further noted that treating the phrase as encompassing three categories of products - MIMO only, LTE only, and both MIMO and LTE - would amount to a distortion of the notification's language and intent, and would be against the principles laid down in Commissioner of Customs (Import), Mumbai v. Dilip Kumar & Co and Ors.: 2018 (361) ELT 577 (SC). It also held that the decision in Sree Durga Distributors v. State of Karnataka (supra) was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner of Customs Chennai-II Commissionerate, Sea Port, Customs House 60, Rajajisalai, Chennai-600001: 2.1. The Access Points imported by M/s Redington India Ltd are classifiable under 85176290 of the Customs Tariff. Since these Access Points are having MIMO technology but without LTE standard, the Basic Customs Duty (BCD) exemption claimed under Notification No. 24/2005-Cus dated 01.03.2005 as amended vide Notification No. 11/2014-Cus dated 11.07.2014 is allowed to them. 2.2 I do not hold impugned goods imported by them liable for confiscation under Section 111(m) of the Customs Act, 1962, during the period from 11.07.2014 to 30.06.2017, with a declared Assessable value of Rs.39,78,50,088/- through Sea Port Chennai vide Bills of entry detailed in Annexure-C to the show cause notice. Therefore, 1 do not confiscate the same. 2.3 The demand of differential Customs duty of Rs. 3,34,44,455/-on the impugned imported goods by them during the period from 11.07.2014 to 30.06.2017 is hereby dropped. 2.4 No interest, on the duty foregone should be recovered from them under Section 28AA of the Customs Act, 1962; 2.5 I do not impose any penalty under Sections 112/114A/114AA of the Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pe would be restricted to those products that have both MIMO and LTE. Thus, according to Reddington a product that has only MIMO technology would not be covered by the exclusion clause and, therefore, would not be excluded from the scope of Serial No. 13 (iv). 18. The submission advanced by learned counsel for the respondent deserves to be accepted. 19. It needs to be remembered that 'and' is a conjunctive and is used to connect and join. The dictionary meaning of 'and' is as follows. "The New International Webster's Comprehensive Dictionary of the English Language: And: Also; added to; as well as; a particle denoting addition, emphasis, or union, used as a connective between words, phrases, clauses, and sentences; shoes and ships and sealing wax... Or: Introducing an alternative: stop or go: red or white. Oxford Dictionary of English, Third Edition: And: Used to connect words of the same part of speech, clauses or sentences, that are to be taken jointly; bread and butter they can read and write a hundred and fifty. Or: Used to link alternatives: a cup of tea or coffee are you coming or not either take taxis or walk everywhere... Collins Cobuild Engl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... using the term 'products' twice. There is, therefore, no ambiguity and the expression 'Multiple Input/Multiple Output (MIMO) and Long Term Evolution (LTE) Products" denotes Multiply Input/Multiple Output (MIMO) products on the one hand and Long Term Evolution (LTE) products on the other. There is, therefore, no need to refer to the World Trade Organisation ITA. 22. Though it is correct that clause (iv) would effectively mean include two categories of products namely MIMO and LTE and that they have distinct identities, but it is not possible to accept the Contention advanced by learned special counsel for the Department that MIMO does not by itself mean anything unless it is followed by the expressions technology' or 'products' and, therefore, since the exception carved out has to be 'goods', this expression has to be Interpreted to connote products based on MIMO technology. 23. What needs to be remembered is that MIMO is a technology and cannot be treated as an independent product. If the intention was to exclude even products having only MIMO technology, then the word 'products' should have been used after MIMO as well as after LTE. It, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of these goods also and the proceedings initiated against other importers was dropped but appeals have not been filed by the Department. 30. The aforesaid discussion leads to be inevitable conclusion 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 No. 13(iv) of the notification. There is, therefore, no infirmity in the order dated 29.11.2019 passed by the Additional Director. 31. Such being the position, it would not be necessary to examine the other contentions raised by the learned counsel for the respondent, including the submission relating to the invocation of the extended period of limitation. 32. The appeal filed by the Department, therefore, deserves to be dismissed and is dismissed..." 14. Aggrieved by the decision of the learned CESTAT, the Revenue has filed the present appeal, challenging the learned CESTAT's interpretation of the exclusion entry (iv) of Serial No. 13 of the amended Notification No. 24/2005 and its findings on the eligibility of the imported MIMO-enabled WAPs for exemption from customs duty. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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