16-piece imported taxable network equipment: FBR

ISLAMABAD: The Federal Board of Revenue (FBR) customs classification committee has ruled that imported network equipment (Smart Signal Booster) is subject to a higher rate of 16 percent customs duty and not 11 percent as stated by an importer.

According to a new resolution issued by the classification committee, the committee considers that the imported contested goods, that is, “Network equipment, namely System Cell FT DUO EXA D32-1/0 BT system Celfi Repeater and CL- Fl Duo Smart Signal Booster (Network Unit)” are classified under heading 8517.6290 of the Pakistan Customs Tariff (PCT).

The Committee noted that the challenged products are a combination of two units (ie Network Unit and Coverage Unit) that do not require the installation of antennas or cables to access the strongest possible 30, 40 and LTE signal to improve the smoother whole-home voice, video, and navigation coverage, so the function is included in ‘—Machines for the reception, conversion, and transmission or regeneration of voice, image, or other data, including switching and routing apparatus ‘, under which different products are specified by description/name, the committee said.

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The audit department wanted to impose a 16 percent import duty under PCT heading 8529.1090 while the importer claimed an 11 percent duty under PCT heading 8517.6100. The committee concluded a 16 percent tax on the importation of such network equipment under PCT heading 8517.6290.

The Collector of Customs, Islamabad and the Court of Appeals submitted a reference for the classification of ‘Network Equipment, namely System Cell FT DUO DCA D32-1/0 BT system Celfi Repeater and CL-FT Duo Smart Signal Booster (Network Unit)’.

The brief facts reported by the Reference Collector are that the importer M/s Mavetech Private Limited, Rawalpindi imported shipments of ‘Network Equipment, viz. System Cell Fi Duo Exa D32-1/0 Bt system Celfi Repeater vide GD No. 5571 and CL-F1 Duo Smart Signal Booster (Network Unit) under PCT Part 8517.6100.

However, the audit authorities made an audit paragraph on the basis that the same importer obtained authorization for identical equipment under PCT Heading 8529.1090. The case was adjudicated vide Order-in-Original dated 30.04.2018 approved by Collectorate of Customs (Award), Islamabad against the importer. The importer filed an appeal with the Islamabad Customs Appeal Court against these orders.

The Customs Court of Appeal referred the matter to the Classification Committee to determine the classification of the contested goods. The audit authorities are of the opinion that the identical goods were correctly classified by the customs authorities under PCT item 8529.1090 vide GD No.1674 dated 05.24.2016. However, the importer maintains that they are classifiable under PCT heading 8517.6100 intended for base stations, the classification committee added.

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