Signal
Convertors for Sat Broadcasts (LNB Convertors) Fall in Electrical Machines nes
under 8543 70 and not 8525 or 8529
[CBEC Circular No. 13 dated 5th April
2013]
Subject: Classification of “Low Noise Block” (LNB) down converter in the harmonised Customs Tariff.
Doubts have been raised
regarding classification of Low Noise Block (LNB) down converter which is
designed to be mounted on aerial (dish) of a system for receiving satellite
broadcasts (Satellite Television Reception
System). The low-noise-block
(LNB) down converter amplifies the weak signals and converts the
frequencies from very high levels (2.5 to 12.45 GHz) to levels within the VHF
and UHF range (less than 2 GHz). The competing Customs tariff headings are 8525
(as transmission apparatus), 8529 (as part to be used with dish antenna, and
8543 (as electrical machines and apparatus having individual functions, not
specified or included elsewhere in chapter 85).
2. The issue was examined in the Board. Classification of goods in the First Schedule under
the Customs
Tariff Act (CTA), 1975 is determined on
the basis of the General Rules of Interpretation (GRI). Rule 1 of GRI inter
alia provides that, “the titles of
Sections, Chapters and sub-Chapters are provided for ease of reference only;
for legal purposes, classification shall be determined according to the terms
of the headings and any relative Section or Chapter Notes ..”. Accordingly,
in
view of the Section Note 2(a) to Section XVI,
LNB will not qualify for classification in heading 8529, if it is regarded
as transmission apparatus of heading 8525 or of heading 8543, as a device
performing an electrical function not specifically covered by any heading of
Chapter 85, since the said Section Note
stipulates that “parts which are goods included in any of the headings of
Chapter 84 or 85 (other than headings 84.09, 84.31, 84.48, 84.66, 84.73, 84.87,
85.03, 85.22, 85.29, 85.38 and 85.48) are in all cases to be classified in
their respective headings”.
3. The Harmonized Commodity Description and Coding System (HS)
Explanatory Notes can be used to determine the proper interpretation of the
entries in the Customs Tariff. In part, Explanatory Note (EN) 8543 includes, “High or intermediate frequency amplifiers
(including measurement amplifiers and aerial amplifiers)”, and Explanatory
Notes to heading 85.18 also provides for, “High
or intermediate frequency amplifiers are classified in heading 85.43 as
electrical appliances having an individual function”. Since the principal function of Low-Noise-Block (LNB)
down converter is to amplify the weak signals and converts the frequencies from
very high levels (2.5 to 12.45 GHz) to levels within the VHF and UHF range
(less than 2 GHz), and this device performs an electrical function not
specifically covered by any heading, the classification in subheading 8543 would seem most appropriate.
4. In view of the aforesaid, the
Board is of the view that by application of GRIs 1
(Note 2 (a) to Section XVI), and 6, separately presented LNB down converter (LNB)
would be appropriately classifiable in heading 85.43, more specifically in
subheading 8543.70, tariff item 854370 99.
5. Accordingly,
all pending classifications, if any, may be finalized. Suitable instructions
may be given to the field formations. Difficulties, if any, faced in the
implementation of this circular, may be immediately brought to the notice of
the Board.
F.No. 528/104/2011-STO (TU)