News Flash
  • Online training on "Advance Ruling: An Introduction" for Group 'A' officers of CBIC on 17.08.2022 from 10:30 AM to 01:15 PM -reg< Click here
  • Notification issued to implement e-invoicing for the taxpayers having aggregate turnover exceeding Rs. 10 Cr from 01st October, 2022 Click here
  • Calling Options/Preferences from selected candidates for the post of Stenographer Grade I & Grade II tor allocation of Zones/Formations - regsteno- I options and Steno- II options
  • Letter dt. 29.07.2022 regarding Equal Opportunity Policy Letter and Equal Opportunity Policy
  • Draft Integrated All India Seniority List of Superintendents of CGST & Central Excise, appointed to the grade during the period from 01.01.2007 to 31.12.2011 Click here
  • Draft Integrated All India Seniority List of Customs Appraisers for the period from 01.01.2012 to 31.12.2013 Click here
  • FAQs on GST applicability on ‘pre-packaged and labelled’ goods-reg. Click here
  • Vacancy Circular - Technical Officer Facilitation/Procedures (Grade A3) – in the Research and Policy Unit (Office of the Secretary General) at World Customs Organisation (WCO), Brussels. Click here   |   WCO Letter   |   Annex_1   |   Annex_2   |   Proforma
  • Online training on "Various issues relating to the illegal/unauthorized import of Jammers and other wireless products" on 28.07.2022 -reg. Click here
  • 16th Session of the Virtual Customs Orientation Academy (VCOA) will be held from 12 September 2022 to 16 December 2022-reg. Click here   |   WCO Letter   |   Annex_1   |   Annex_2   |   Proforma
  • Notice calling for suggestions, views, comments etc. from stakeholders on comprehensive changes in FORM GSTR-3B Click here
  • Final Zone Allocation of candidates selected through SSC CGLE 2019- reg Annexure-I   |   Annexure-II   |   Annexure-III   |   Annexure-IV   |   Covering Letter
  • Letter, Schedule, Syllabus, Instructions alongwith an Excel file (Requisition Form) regarding Departmental examination for Inspectors of Central Tax for Confirmation to be held from 02.08.2022 to 05.08.2022 issued by NACIN, ZC, Kanpur Letter and Details
  • Request for uploading instruction titled "Conduct of HC Litigation Monitoring Fortnight from 14.07.2022 to 27.07.2022 Click here
  • Warehousing of solar power generating units or items like solar panel, solar cell etc. for power plants with resulting goods ‘electricity’ - In-applicability of Manufacture and Other Operations in Warehouse (no.2) Regulations, 2019 under section 65 of the Customs Act, 1962 regarding Click here
  • Marks Declared: Marks of Deptt. Exam. for Inspectors of Central Tax held in 14.03.2022 to 16.03.2022 and 19.03.2022 declared. Nodal Officers (Exam) may download marks-sheet alongwith forwarding letter from their e-Mail ID.
  • Recruitment to the Post of Skipper on deputation-RegClick here
  • CBLR -2022 exam Declaration of date-regClick here
  • Online training on 'Budget Management: Estimation, Allocation & Expenditure' for Group 'A' officer of CBIC on 12.07.2022 from 10:30 AM to 01:15 PM -reg. Click here
  • Prospective Training for the month of July , 2022 Click here
  • Notification issued to notify the provisions of clause (c) of section 110 and section 111 of the Finance Act, 2022
  • Notification issued to exempt taxpayers having AATO upto Rs. 2 crores from the requirement of furnishing annual return for FY 2021-22
  • Notification issued to extend due date of furnishing FORM GST CMP-08 for the quarter ending June, 2022 till 31.07.2022
  • Notifications issued to extend the waiver of late fee for delay in filing FORM GSTR-4 for FY 2021-22 and to extend dates of specified compliance
  • Notifications issued to make amendments (First Amendment, 2022) to the CGST Rules, 2 017
  • Simplified regulatory framework for e-commerce exports of jewellery through Courier mode Circular and Notification
  • Notification issued on Notification for Departmental Examination for promotion of Tax Assistants to the Grade of Executive Assistants of Central Taxes & Customs to be held in the month of September, 2022. It also contains the Schedule, Syllabus and Instructions for Examination along with the format (in Annexure II) for requesting for Question Papers. Click here
  • Invitation for scholarship programme- Master Degree in Strategic Management and IPR at Aoyama Gakuin University (AGU) Tokyo Japan (2023-24)-reg. Click here | WCO Invitation   |   Annex-1   |   Annex-2   |   Annex-3   |   Proforma
  • Commendation Certificate on the occasion of 5th GST Day- regClick here
  • O.M. dated 24.06.2022 regarding Constitution of Internal FRACing Unit (IFU) - regarding Click here
  • Corrigendum dated 21.06.2022 regarding RFP No. NACIN/TRNG/232/2022-MCTP-O/o Pr. DG-NACIN-Faridabad dated 01.06.2022 to select a Partner Institute to conduct Phase-III and Phase-IV of Mid-Career Training Programme (MCTP) for IRS (C&IT) Officers Click here
  • Request for publishing notice inviting tender for hiring of office premisesat Bhopal for NACIN ZC, BhopalClick here
  • Independence Day Flag Ceremony at Red Fort on 15th August, 2022Click here
  • Posting of Joint Secretary/Commissioner in the Central Board of Indirect Taxes & Customs- reg. Click here
  • Combined Graduate Level Examination 2019- Final Verification of Options/Preferences– reg. | Annexure-A   |   Annexure-I   |   Annexure-II   |   Annexure-III   |   Annexure-IV   |   Covering Letter
  • Willingness of CBIC Inspectors for posting in Ad.IIIB on loan basis- reg. Click here
  • Procedure relating to sanction, post-audit and review of refund claims Click here
  • Requistion / Requirement of filling up posts on deputation in LPAI (MHA)-RegClick here
  • Notification issued on Notification for Departmental Examination for promotion of Ministerial Officers to the Grade of Inspectors of Central Taxes, Inspectors of Customs (Preventive Officers) & Inspectors of Customs (Examiners) to be held in the month of August, 2022. It also contains the Schedule, Syllabus and Instructions for Examination along with the format (in Annexure II) for requesting for Question Papers. Click here
  • Notice calling for feedback, inputs, comments etc. from all stakeholders on the draft circular and related notifications for facilitating e-commerce exports of Jewellery through courier mode, uploaded on 7th June 2022. Click here
  • Nomination calling for training on "Stress and Yoga: Curse and Cure" for Group A officers of CBIC on 21st June, 2022 at NACIN HQ, Faridabad -reg Click here
  • INVITATION FOR EXPRESSION OF INTEREST FOR SELECTION OF TRAINING PARTNERS/PARTNER INSTITUTE TO CONDUCT PHASE -III & PHASE -IV MID-CAREER TRAINING PROGRAMME (MCTP) FOR IRS (C & IT) OFFICERS Click here
  • CGLE 2019- Verification of Options/Preferences, and final chance for exercising options for left-out candidates | Annexure-A   |   Annexure-I   |   Annexure-II   |   Annexure-III   |   Annexure-IV   |   Document 5
  • Exemption in PET PST for recruitment to the post of Havaldar in CBIC Click here
  • -->
View All

AUTHORITY FOR ADVANCE RULINGS

(CENTRAL EXCISE, CUSTOMS & SERVICE TAX)

NEW DELHI

 

PRESENT

 

 

Justice Syed Mohammed
Quadri
(Chairman)
Mr. Somnath Pal
(Member)
Dr. B.A.Agrawal
(Member

 

Ruling Nos. AAR/15-17(Cus)/2005

In

 Application No.AAR/44(Cus)/13/2005

Application No.AAR/44(Cus)/12/2005

Application No.AAR/44(Cus)/11/2005

 

 

Applicant  

M/s Alcatel India Ltd. 

Plot No. 25, Sector 18

Gurgaon-122015
Haryana, India

Commissioner designated  

Commissioner of Customs,

Air Cargo Complex

New Custom House
New Delhi-110037

Present :  for the applicant  None
for the Commissioner 
designated 

Shri A.K. Roy, Joint CDR

CESTAT, New Delhi

                                                                                   

R U L I N G

 

( By Mr. Somnath Pal, Member )

 

            The following three applications have been filed by M/s Alcatel India Ltd., Plot No. 25, Sector-18, Gurgaon, Haryana, India (hereinafter to be referred to as "the applicant") under section 28H of the Customs Act, 1962 (for short "the Act") as a wholly owned subsidiary Indian company of M/s Alcatel, France.  The questions raised in these three applications for advance ruling are also indicated below against the corresponding application Nos :-

(a)       Application No. AAR-44(Cus)/13/2005 - "Whether Submerged passive tilt equalizer R4 proposed to be imported into India is classifiable under Heading No. 8517 50 99 of the First Schedule of the Customs Act, 1975" (apparently a printing error for Customs Tariff Act, 1975).

(b)       Application No. AAR-44(Cus)/12/2005 - "Whether Submerged Adjustable slope equalizer Unit R3 to be imported into India, is classifiable under Heading No. 8517 50 99 of the First Schedule of the Customs Tariff Act, 1975."

(c)        Application No. AAR-44(Cus)/11/2005 - "Whether Submerged Passive Equalizer Unit R2 proposed to be imported into India, is classifiable under Heading No. 8517 50 99 of the First Schedule of the Customs Tariff Act, 1975".

            We have clubbed these three applications for advance ruling since they contain the common question of classification of "Equalizer", though, in finer details, the three items under consideration function as equalizer for equalization of three different parameters, namely, "tilt", "slope" and "shape"  of the gain/wavelength needed to optimize the overall transmission through the submerged cable.

2.         In respective Annexure-II to the three applications, the applicant, after giving brief description of the goods in question and referring to the General Interpretative Rule 1 of the First Schedule to the Customs Tariff Act has stated  that the equalizers under consideration are clearly telecommunication apparatus.   These, according to the applicant, are classifiable under tariff heading 8517 50 99 which reads "other apparatus, for carrier-current line systems or for digital line systems".  The applicant has enclosed alongwith these applications copies of the rulings given by the U.K./the U.S.A./Australian Customs all of whom have classified these products under tariff sub-heading 8517 50.

3.         The designated Commissioner, namely, the Commissioner of Customs, Air Cargo Exports, New Custom House, IGI Airport, New Delhi (hereinafter to be referred to as "the Commissioner") in his comments has, however, contended that the classification of the three equalizers under consideration would be under tariff heading item 8543 89 99.  According to the Commissioner, the tariff heading 8543 appears more appropriate because it covers all electrical appliances and apparatus, not falling in any other heading of Chapter 85, nor covered more specifically by a heading on any other Chapter of the Nomenclature, nor excluded by the operation of a Legal Note to Section XVI or to the Chapter 85 from heading 8543.  The electrical appliances and apparatus of this heading must have individual function.  Tariff item 8543 89 81 covers graphic equalizers.  The equalizers in question are similar equipment and having an independent function and not covered more specifically by a heading of any other Chapter of the Nomenclature, nor excluded by the operation of a legal note to Section XVI or to Chapter 85.  They therefore merit classification under tariff item 8543 89 99. 

4.         Despite repeated opportunities given to the applicant by postponing the hearing in the months of August, September and October, 2005 as requested by them, nobody appeared before the Authority on behalf of the applicant for the hearing on the rescheduled dates.  The Commissioner was however, represented by the Joint CDR who appeared before us and reiterated the view expressed by the Commissioner.

5.         In response to the comments of the Commissioner suggesting classification of these Equalizers under tariff item 8543 89 99, the applicant however reacted and sent their comments drawing attention to the technical information already furnished by them in respect of these three items and  contending that these products are not independent units but are specifically designed for use in the submerged telecommunications systems.  Referring to the rulings given by the UK, the USA and Australian Customs and to the General Interpretative Rule 1, they reiterated that the three "Equalizers" in question are appropriately classifiable under tariff item 8517 50 99.

6.         We have carefully examined the matter in the light of the three questions posed before us.  On the technical front, as per the details furnished by the applicant in respective Annexure-II to the three applications and the related Customs Technical Document, the common features of the three Equalizers in question are :-

(i)                 They are designed for telecommunications systems utilizing submerged equipment.

(ii)               They form part of a submarine telecommunication system for use in transmission of aggregate data.

(iii)             They are of Alcatel generic design and include features that allow their configuration to suit a given system.

(iv)              They function as dedicated units for the transmission of aggregate data.

(v)                They are all modular in construction. 

            On the other hand, as we have already mentioned, the difference amongst the three Equalizers lies only in the nature of the parameter which requires equalization to optimize the overall transmission through the submerged cable.  For proper appreciation of this aspect, we find it useful to cull out the relevant technical details given in the above documents which are as follows :-

Sl.No. Application No.       Goods and its functional parameters

 A.

Application 13/2005

(a)

 

 

(b)

 

(c)



(d)

(e)

The Submerged R4 Passive Tilt Equalizer (PTEQ) is inserted in a submerged telecommunication system where an equalization of the residual gain/wavelength aggregate data signal must be provided through modification of the transmission tilt where multi-channel telecommunication signals are involved.

It modifies the transmission tilt for multi-channel optical transmission system.

The residual wavelength signal tilt accumulates when the signal passes through a number of repeater sections during the normal operational activity.

Dependant upon the system configuration, a number of different positive or negative tilt filters or a zero attenuator can be fitted to provide equalization and optimize the signal/system performance.

It is a hybrid of optical and mechanical systems.

B.

Application 12/2005

(a)

 
 

(b)

 

 

 

 

 

(c)

 



(d)

 
 

(e)

The Submerged R3 Adjustable Slope Equalizer Unit (ATEQ) is inserted in a submerged telecommunication system to provide equalization of the gain/wavelength slope in order to optimize the overall transmission through the submerged cable.

Each constituent wavelength of the incoming telecommunication signal undergoes a polarization rotation, applying an electrical current to the device controls the degree of rotation.  The polarization of each different signal wavelength will be rotated by a different amount.  The output section of the device acts as a polarization analyzer and attenuates each signal wavelength depending on its degree of rotation.  Since the wavelengths at opposite ends of the spectrum are rotated by different amounts, one end of the signal wavelength band will be attenuated more than the other resulting in a sloped response and an optimization of the signal over the cable length. 

The gain/wavelength slope develops after a number of system repairs and/or ageing of the system line.  The equalization shape that is required is decided upon by measurement of the actual gain profile of the telecommunication system Alcatel repeaters operating under normal seabed conditions.

Two optical assemblies are constructed with their controlling electronic circuits on a common internal assembly (boat), so that one boat provides the functionality required for one fibre pair.  Several boats can be incorporated in a single housing to operate with up to eight fibre pairs.

It is a hybrid of optical, electronic and mechanical systems.

C.

Application 11/2005

(a)

 


(b)

 




 

(c)

 


(d)

The Submerged R2 Passive Shape Equalizer Unit (SEQ) is inserted in a submerged telecommunication system where an equalization of the residual gain/wavelength non-linearity is required to optimize the overall system transmission.

The equalization shape that is required is decided upon by measurement of the actual gain profile of the telecommunication system Alcatel repeaters operating under normal seabed conditions.  The signal loss/wavelength characteristic required is then "converted" into a multi element Bragg Grating optical fibre filter assembly, consisting of up to five individual elements.

Modules are configured in pairs on a common internal assembly (boat); several boats can be incorporated to operate with up to eight fibre pairs.  The SEQ passes power feed current without any significant voltage drop.

It is a hybrid of optical and mechanical systems.

7.         With a view to examining the contention of the Commissioner on the classification of these three types of equalizers, it is necessary to reproduce the relevant portion of the tariff heading 8543.  This heading reads as under :-

"Electrical machines and apparatus having individual functions, not specified or included elsewhere in this Chapter"

            Under this heading there is a specific category "Graphic equalizer and synthesised receivers".  Since the Commissioner has taken the tariff item 8543 89 99 as the appropriate classification, the entire portion of the tariff starting with the category "graphic equalizer and synthesised receivers" and ending with tariff item "8543 89 99 ---- other" is reproduced below for easy reference :-

Tariff Item

 

Description of goods

Unit    Rate of duty

         Standard   Preferential 

                        Areas

(1)

 

(2)

(3)          (4)          (5)   

 

 

 

8543 89 81

 

8543 89 82

 

 

 

8543 89 91

 

 

 

 

8543 89 92

 

 

8543 89 93

 

8543 89 94

 

8543 89 95

 

8543 89 99

---

 

 

----

 

----

 

---

 

----

 

 

 

 

----

 

 

----

 

----

 

----

 

----

Graphic equalizer and synthesised receivers :

 

Graphic equalizers

 

Synthesised receivers

 

Other :

 

RF (radio frequency) power amplifiers and noise generators for communication jamming equipment, static or mobile or manportable

 

Equipment or gadgets based on solar energy

 

Professional beauty care equipment

 

Audio video stereo encoders

 

Time code generator

 

Other

 

 

u           15%              -

 

u           15%              -

 

 

 

 

u           15%              -

 

 

 

 

u           15%              -

 

 

u           15%              -

 

u           15%              -

 

u           15%              -

 

u           15%              -

 

            From the above layout of the Tariff, it is clear that as far as equalizers are concerned there is only one type, namely, "graphic equalizer" which has been specified against tariff item 8543 89 81.  There is no specific item for other equalizers under tariff heading 8543.  It is not the case of the Commissioner that the equalizers under consideration before us are covered by the specific item, namely, graphic equalizers.  In fact, he has indicated that these three equalizers are equipment similar to graphic equalizers.  The category "graphic equalizer and synthesised receivers", we observe, specifically covers two items both of which have been individually specified against tariff item 8543 89 81 and 8543 89 82.  There is therefore no scope whatsoever of having any third item under this category.  The next category is "Other" which is a residual entry for items not covered by any other earlier tariff items up to 8543 89 82.  Under this residual category, five types of goods have however been specified and the final residual tariff item is 8543 89 99 which therefore covers any goods which are not covered by any of the tariff items up to 8543 89 95 under the heading 8543.  Thus it is  apparent that this residual tariff item mentioned by the Commissioner is not a specific item for equalizers.  It is a well settled law that before we take resort to a residuary item we must cautiously exclude the possibility of coverage of the goods by any other tariff heading/sub-heading/item.  In the case before us, the heading 8543 itself is in the nature of a residuary heading in so far as electrical machines and apparatus having individual functions are concerned.  Such machines and apparatus can fall under the heading 8543 only if they are not specified or included elsewhere in Chapter 85.  The tariff item 8543 89 99 is thus the residuary tariff item of a residuary tariff heading of Chapter 85 and hence its coverage is very general and far removed from being specific.

8.         From the technical details and functional parameters as explained in the annexures to the application it becomes clear that the three products in question are a combination of either optical and mechanical elements or of optical, electrical/electronic and mechanical elements and they play an integral  and inseparable part in the transmission of data as a telecommunication apparatus for carrier current line systems or for digital line systems.  The heading 8517 includes "telecommunication apparatus for carrier-current line systems or for digital line systems".  The coverage of the category "apparatus for carrier-current line systems or for digital line systems" has been indicated in the HSN Explanatory Note to heading 85.17 which reads as follows :-

"These systems are based on the modulation of an electrical carrier-current or of a light beam by analogue or digital signals.  Use is made of the carrier-current modulation technique and pulse code modulation (PCM) or some other digital system.  These systems are used for the transmission of all kinds of information (words, data, images, etc.)

            These systems include all categories of multiplexers and related line equipment for metal or optical-fibre cables.  "Line equipment" includes transmitters and receivers or electro-optical converters.  Combined modulators-demodulators (modems) are also classified here."

9.         It is not the case of the Commissioner that these "Equalizers" are not integral parts of submerged telecommunication systems or they are not telecommunication apparatus.  The only contention is that despite being so, they are more specifically covered under heading 8543.  We have already examined the scope and coverage of this heading in our another recent ruling in the  applicant's case on the question of classification of "Submerged Repeater Generic R4" (vide Ruling No.AAR/14(Cus)/2005, dated 24-11-2005).  We are not therefore repeating it again here.  Suffice it to say that the Commissioner's contention that the Equalizers in question are more specifically covered by heading 8543 than 8517 is not convincing enough to merit acceptance.  In our view they are appropriately classifiable under tariff heading 8517 rather than the very wide and general residuary item 8543 89 99.   Since the goods under consideration are not covered by any of the sub-heading/tariff items from        8517 11 up to and including 8517 30 00, it will fall under sub-heading 8517 50 and more precisely under the tariff item 8517 50 99, after excluding rest of the specified items 8517 50 10 to 8517 50 94.

10.       For the reasons given above,  we rule on the questions raised in the three applications that the goods namely (a) Submerged passive tilt equalizer R4, (b) Submerged Adjustable slope equalizer Unit R3 and  (c) Submerged Passive Equalizer Unit R2 are individually classifiable under the 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 24th day of November, 2005.

 

 Sd/-
(B.A.Agrawal)
Member
 Sd/-
(Justice S.S.M.Quadri)
Chairman
 Sd/-
(Somnath Pal)
Member