TaxTMI 
TaxTMI 
2024 (9) TMI 918
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....of exemption Notification No.21/2002-Cus. dated 1.3.2002 and Notification No.12/2012-Cus. dated 17.03.2012 mis-declaring as parts for manufacture of Base Trans-receiver Station (BTS), whereas they were not manufacturing BTS equipment. On the basis of intelligence, it is alleged that the appellants are manufacturers of telecom racks for which they import radial/centrifugal fan, temperature control module, CS lock tongue, lamp cable, etc., declaring the same as "Parts for BTS rack, Parts for Base-receiver Stations, For BTS, Parts of Telecom Racks", etc., and claimed exemption under Sl. No.242 of Notification No.21/2002-Cus. dated 01.03.2002 as amended and Sl. No.372(ii) under Notification No.12/2012-Cus. dated 17.3.2012 as parts for manufacture of BTS (Sl. No.3(a) of List 22 and List 17 applicable to Sl. No.242 of Notification No.21/2002-Cus. dated 01.03.2002 as amended and Sl. No.372(ii) under Notification No.12/2012-Cus. dated 17.03.2012). Show-cause notice was issued to the appellant on 05.06.2013 for recovery of the customs duty short-paid amounting to Rs.84,41,352/- with interest and proposal for imposing penalty under Section 114A and Section 114AA of the Customs Act, 1962, dur....
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....k fitted with cooling components such as radial fans, gore cooling filters, etc., manufactured by the Appellant) and active components such as Base Band Unit (BBU), radio equipment, transmission equipment, etc., manufactured by Ericsson. It is submitted that only when the above parts are put together, it qualifies as an operational/functional BTS. Without either of the parts, the BTS is incomplete and cannot function efficiently. In support, definition of BTS given in Newton's Telecom Dictionary is relied upon, which reads as:- "The electronic equipment housed in cabinets that together with antennas comprises a PCS facility or site. The cabinets include an air conditioning unit, heating unit, electrical supply, telephone hook-up, and back-up power supply". A plain reading of the above definition shows that BTS is an electronic equipment housed in cabinets. Therefore, the telecom racks/cabinets manufactured by the Appellant form an integral part of BTS. In other words, without the cabinet/rack along with other necessary items, the station is incomplete as they play a major role in the efficient functioning of BTS. 3.2 Further, reliance was placed on the following case....
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....t asserted that they are manufacturing intermediary goods and parts of BTS and nowhere it is said that the imported goods are to be used for manufacture of final goods and not the intermediary goods as claimed by the appellant, does not in any way provides them the liberty to construe the Notification as per their convenience. Rather, for strict interpretation of the Notification, it is imperative that the Notification should specify that the imported goods may be used for manufacture of intermediary goods/parts of BTS and in the absence of the same, the benefit of the Notification has been rightly denied in the impugned orders. 4.1 It is his contention that the question to be decided is not as to whether the denial of benefit is correct or otherwise, rather than the question to be decided is whether the benefit of Notification is correct, just and legal or not. The Notification should be strictly interpreted as held by the Hon'ble Supreme Court in the case of Hari Chand Shri Gopal: 2010 (16) ELT 3 (SC) and Dilip Kumar & Co.: 2018 (361) ELT 577 (SC). 4.2 Further, he has submitted that the appellant have claimed that they were manufacturing telecom racks which are integral par....
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.... 7. The appellants had imported the following parts claiming exemption under Notification No.21/2002 Cus & 12/2012 Cus during the relevant period: a. Radial/centrifugal fans b. Temperature control module c. CS lock tongue and CS lock middle block d. CS door stay e. Alarm cable f. Lamp cable g. Ergoform S handle h. Dirak lock insert i. Gore cooling filters j. Air-to-air heat exchanger k. CS lock bar stay l. Hinge, m. cable hex side & cable hex door n. CS thermal isolation foam o. Lamp bulb p. Lamp holder q. CS OVP grounding screw r. Screw M5 X 15 SS Torx head s. KSS edge protection t. CS BS and M5-2 screw 8. The said parts are used in the manufacture of telecom racks i.e., outdoor compact enclosures/outdoor cabinets, following the procedure laid down under Customs(Import of Goods at concessional rate for Manufacture of Excisable Goods),Rules,1996. The said manufactured 'telecom racks' are supplied to M/s. Ericsson India Pvt. Ltd., who in turn assemble with other components to manufacture 'Base Trans-r....
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....nsees and Universal Access Service Providers. Condition No. Conditions 5. 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. 47. If imported by a person licensed by the Department of Telecommunications of the Government of India for the purpose of providing basic telephone service, cellular mobile telephone service, value added services via V-SAT system or Internet Service 10. Subsequently, Notification No.12/2012-Cus. dated 17.03.2012 was issued whereunder the appellant claimed the benefit under Sl. No.372(ii) of List 17. The conditions prescribed under the said Notifications are 5 and 52 which reads as follows: Sl. No. Chapter or Heading or sub-heading or tariff item Description of goods Standard rate Additional duty rate Condition No. 372 84, 85 or 90 (i) Goods specified in List 17 required for basic telephone service, cellular mobile telephone service, internet service or closed users‟s group 64 KBPS domestic data network via INSAT satellite system service. Notwithstanding anything contained in List 17, the exemption shal....
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....ted by a person licensed by the Department of Telecommunications of the Government of India for the purpose of providing basic telephone service, cellular mobile telephone service, value added services via V-SAT system or Internet Service 9. The Revenue alleging that the appellants are not using imported parts in the manufacture of the BTS system(sr. no 3(a) of List 22), but used it in the manufacture of outdoor cabinets, which after installation of other systems at the premises of M/s. Ericsson becomes parts of the BTS system. The appellant had argued that outdoor cabinets Telecom Racks forms an integral part of BTS, thus, imported goods for manufacture of parts of telecom racks are also parts of BTS. It is their contention that part of part will construe part as a whole. In support, they have referred to the judgment of this Tribunal in the case of Collector of Central Excise v. Mahendra Engg. Works, 1993 (67) ELT 134 (Tribunal) and M/s. Racily Udyog, Shri Kalyan Das v. Commissioner of Central Excise, Kolkata-III, 2023-VIL-411-CESTAT-KOL-CE. 10. The learned Authorised Representative for the Revenue on the other hand heavily relied upon the judgment of the Principal Bench of....
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....in the factory of production of such parts for the manufacture of goods specified at serial numbers 1 to 20 and not parts of water pumping station. It needs to be noted that entry number (10) of List 8 mentions 'solar power generating system' and not 'module mounting structures'. ........... 18. It is, therefore, not possible to accept the contention of learned counsel for the appellant that the module mounting structures' should be granted exemption from payment of excise duty in terms of the notification dated 17.03.2012 and not the 'solar power generating system'. ............ 21. An exemption notification has to be strictly construed, as was observed by the Supreme Court in Commnr. of Customs (import), Mumbai versus M/s. Dilip Kumar and Ors. 2016 (5) TMI 185 - Supreme Court = 2018-TIOL-302-SC-CUS-CBand in Larsen & Toubro Ltd. versus Commissioner of Central Excise, Hyderabad 2015 (324) E.L.T. 646 (S.C.) = 2015-TIOL-236-SC-CX. 22. The distinction sought to be drawn by the learned counsel for the appellant between 'devices' and 'systems' is not of relevance to the present case because both non....
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....us. dated 01.03.2002. Also, the judgment cited by the learned advocate in support of their contention that parts of the parts are admissible to the benefit of the said Notification L.G. Electronics India Pt. Ltd. Vs. Commissioner of Customs, Mumbai, not applicable to the present case as the issue involved for determination in the said appeal was parts and components of the mobile handsets imported separately in SKD conditions whether would be eligible to exemption under Notification No.21/2002-Cus. dated 01.03.2002 as parts, components and accessories of mobile handsets including cellular phones. Similarly in the judgment of the Tribunal in the case of Mahendra Engineering Works (supra) where stampings and laminations used in the manufacture of electric motors or rotors which is used as parts and components in the manufacture of power-driven pumps under Notification No.236/1986 also not applicable to the facts of the present case. Similarly, the judgment of the Tribunal in the case of M/s. Racily Udyog, Shri Kalyan Das's case, whether battery is considered as a part of the Solar Power Generating System, is not applicable to the present case as the Solar power batteries are directly....