CESTAT Remands Customs Classification Dispute on GPON Telecom Equipment for Fresh Examination

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Bangalore Bench has set aside an appellate order confirming the reclassification of imported GPON network devices and remanded the matter to the adjudicating authority for fresh consideration in light of new technical evidence. The bench of Dr. D.M. Misra (Member Judicial) and R. Bhagya Devi (Member Technical) noted that the core issue in the case was not whether the goods fall under Heading 8517, but the correct sub-classification within the heading. The dispute arose from the classification of telecom equipment imported by the company, including Gigabit Passive Optical Network Optical Line Terminal (GPON OLT), SFP modules, Optical Network Units (ONU), and Optical Network Terminals (ONT). The importer had declared these products under Customs Tariff Heading (CTH) 8517 6250, classifying them as “Digital Loop Carrier (DLC) systems.” However, the Customs department took the view that the goods did not qualify as Digital Loop Carrier systems and instead reclassified them under CTH 8517 6990, a residual entry for other transmission apparatus. Based on this reclassification, the department issued show cause notices demanding differential customs duty along with interest, which was subsequently confirmed by the adjudicating authority and upheld by the Commissioner (Appeals). Aggrieved by this decision, the company approached the tribunal. Before the tribunal, the appellant argued that the GPON OLT devices function as core equipment in fibre optic network infrastructure and perform signal conversion and coordination functions between optical network terminals installed at customer premises and the service provider’s control systems. The company contended that the GPON OLT operates as a Digital Loop Carrier, which justified classification under CTH 8517 6250. Alternatively, the device performs routing functions and could also be classified as routers under CTH 8517 6930. The appellant also produced technical documentation and a test report issued by Compliance International Telecom Laboratories, which stated that the device supported routing protocols such as RIPv1, RIPv2, OSPFv2, Static Routing, RIPng, and OSPFv3, indicating that the equipment could function as a router. In addition, the appellant relied on technical documents issued by the Department of Telecommunications (DoT) to explain the functionality of the imported devices. The department argued that Optical Network Devices like OLT, ONU, and ONT are technologically distinct from Digital Loop Carrier systems. According to the department, DLC systems are used to digitize and multiplex voice circuits and transmit them over copper or fibre lines, whereas the imported equipment performs different networking functions. The department also maintained that the appellant had not produced sufficient technical evidence during earlier proceedings to justify classification under the DLC category. The tribunal observed that the importer had produced additional technical literature and certifications before it, including the laboratory report suggesting that the GPON OLT device possessed router functionalities. These documents, however, had not been placed before the lower authorities at the time the original orders were passed. The bench also noted that certain technical materials issued by the Department of Telecommunications were generated after the impugned orders, meaning the earlier authorities had no opportunity to examine them. Considering the fresh technical documents and in the interest of proper adjudication, the tribunal held that the matter required reconsideration. The CESTAT set aside the impugned order of the Commissioner (Appeals) and remanded the case to the original adjudicating authority and directed that the authority examine the classification issue afresh after allowing the appellant to submit all relevant technical literature and supporting documents. The tribunal concluded that a fresh determination based on complete technical evidence would ensure a fair and accurate classification under the Customs Tariff. Case Details Case Title: M/s. Netlink ICT Private Limited Versus Customs commissioner Citation: JURISHOUR-306-CES-2026(BANG) Case No.: Customs Appeal No. 20148 of 2021 Date: 04.03.2026 Counsel For Appellant: Jose Jacob, Advocate Counsel For Respondent: Vikalp Jain, Superintendent (AR) Click Here To Read Order Read More: Family Courts Can Admit Electronic Evidence Without Strict Evidence Act Compliance: Gujarat High Court

CESTAT Remands Customs Classification Dispute on GPON Telecom Equipment for Fresh Examination

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