AUTHORITY FOR ADVANCE RULINGS

(CENTRAL EXCISE, CUSTOMS & SERVICE TAX)

NEW DELHI

PRESENT

Hon'ble Mr.Justice Syed Shah Mohammad Quadri (Chairman)

Mr.Somnath Pal (Member)

Dr.B.A.Agrawal (Member)

Ruling No. AAR/02(Cus)/2006

In

 Application No.AAR/44/22(Cus)/2005

R U L I N G

( By Mr. Somnath Pal, Member )

The applicant in this application has posed the following question seeking an advance ruling thereon :- 

"Whether Optically Post Amplifier unit (unrepeatered) proposed to be imported into India, is classifiable under Heading No. 8517 50 99 of the First Schedule of the Customs Tariff Act, 1975" .

2.         As per the description of the goods in question given in the Annexure-II to the application, the Alcatel Optical Post-Amplifier (OPA28C) can be installed in the Alcatel URW subrack telecommunication equipment when there is a requirement for high power amplification of the transmitted WDM (Wavelength Division Multiplexing) communication signal before it is launched into the submarine telecommunication cable.  The OPA28C can deliver up to +28dBm aggregate power into the submarine line.  It is a hybrid of optical, electronic and mechanical systems  that forms part of a submarine telecommunication system for use in transmission of aggregate data.  The WDM telecommunication signal from the terminal is amplified in the Alcatel OPA28C by an Erbium-doped Fibre Amplifier (EDFA), which uses a pump laser to give an aggregate output power to line of up to +28dBm.  Though the function of the product is to amplify the signal it is still however part of the submerged telecommunication system as it is basically boosting the signal to ensure there is no distortion or impurities in the signal.  In the Customs Technical Document relating to this product it has been further explained that the OPA28C is of an Alcatel generic design and includes features that allow the configuration of this equipment to suit a given system.  All transmission connections are made by removable SC/APC type connectors, except the fibre to the sea cable.  This is spliced directly to the submarine line to ensure satisfactory transmission of the high power signal.  It has been further submitted that this equipment functions as a dedicated unit for the transmission of aggregate data.  During the hearing before us the Ld. Representatives of the applicant, while reiterating the above technical information, drew our attention to the block diagram of this equipment as given in the Customs Technical Document to show that this equipment houses many other components besides the EDFA, like detector, input monitor, output monitor and shutdown logic.  It was contended by them that the equipment in question is not covered by tariff heading 8543 which applies to electrical apparatus having  individual function not elsewhere specified in Chapter 85.  According to the applicant, it is more appropriately classifiable under heading 8517 as an apparatus for carrier-current line systems or for digital line systems.  Rule1 of the General Rules for the Interpretation of First Schedule of the Customs Tariff Act, 1975 is enough for deciding the classification and there is no need to go to Rule 3 (c) as contended by the Commissioner.  Reference was also made to the Information Technology Agreement Schedule from India to WTO which indicates that amplifiers used in telecommunications are classified under heading 8517.

3.            Though in his initial comments the Commissioner had submitted that this product being an amplifier and having an independent function would fall under tariff item 8543 89 79 as high or intermediate frequency amplifier, the Learned Joint CDR representing the Commissioner, however, conceded during the hearing before us that having regard to the technical information furnished by the applicant as further elaborated and explained by their representatives,  the goods in question would more appropriately fall under tariff item 8517 50 99.  He also cited in this context the recent rulings of the Authority given in the applicant's case in regard to classification of 'Equalisers' and 'Repeaters' which have been held to be falling under tariff heading 8517 50 99.

4.         Having regard to the technical details and the functional parameters of the apparatus as explained by the applicant, in writing as well as during the hearing, we find that it is indeed a combination of optical, electronic and mechanical elements and the function of amplification is an integral and inseparable part in the overall operation of this product.  Its various component parts and their functions as depicted in the block diagram and as narrated in the technical write up, clearly show that all these parts put together contribute to the function of transmission of data as a telecommunication apparatus for carrier-current line systems or for digital line systems falling under heading 8517.  In our earlier Ruling No. AAR/14(Cus)/2005 dated 24.11.2005, we have examined in detail the scope of the heading 8543 and also referred to the HSN Explanatory Note to heading 8517.  We are satisfied that the apparatus under consideration is more appropriately covered by heading 8517 rather than by heading 8543.  In his final comments, the Ld. Joint CDR representing the Commissioner has also taken this stand.  Keeping in view the tariff layout of the sub-heading 8517 50, it is apparent that the goods in question would fall under tariff item 8517 50 99.

5.         For the reasons given above, we rule on the question raised in this application that the Optical Post-Amplifier Unit (unrepeatered)  is classifiable under tariff item 8517 50 99 of the First Schedule of the Customs Tariff Act, 1975.

Pronounced in the open Court of the Authority on this 5th day of January, 2006.

                 Sd/-                                         Sd/-                                                     Sd/-

      (B.A.Agrawal)                    (Justice S.S.M.Quadri)                            (Somnath Pal)    

           Member                                    Chairman                                       Member