The Customs Department in Mumbai turned to the Supreme Court and questioned three companies Reliance Group Companies, Reliance Sibur Elastomers PVT. LTD, Reliance Corporate It Park Ltd and Reliance Digital Platform & Project Services LTD, through a higher import tax on their telephone conscience Cisco UC/IP.
The case came in front of the bench of Judge Manoj Mishra and took Bhuyan on Friday, who postponed the hearing until next Friday, September 19).
Customs and reliability question how to classify imported Cisco phones according to the Indian Customs Act on Customs Sazets in 1975.
The customs authorities have reclassified the VoIP table phones as a video conferencing device that has a higher obligation. Reliance claimed that the device lacked cameras, did not support video calls, and deserved classification as conventional button phones.
Not sufficient technical reasons
The customs department did not provide sufficient technical reasons to justify the fine. Given the lack of evidence and proper technical assessment, the tribunal decided the punishment of the unfounded.
These editions date back to the three Reliance consistency on October 17, 2018, 25 November 2019 and 5 May 2020.
The customs solution did not agree with the AS classification to communicate previous judicial decisions indicating that the VoIP device can be considered a device for video conferencing. After the Commissioner Mumbai’s Customs confirmed the classification of higher customs duties for all three Reliance entities.
The Tribunal overturned the sentence against Reliance and decided that its basic VOIP phones, used only for voice calls and without camcorders, were incorrectly classified according to the earlier decision for video conferencing devices. The previous case of Ingram Micro was not used and the customs authorities committed a mistake in extending their extent.
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Reliance attacked these orders before the customs, consumer and tax appeal court (travel). In its judgment 7 April 2025, the court focused on relying and canceled higher requirements for duty.
The Tribunal noted that Cisco UC/IP phones were common phones buttons without built -in cameras and could not be considered a device for video conferencing. He stressed that the direction of 8517 of the Customs Act clearly distinguishes “telephone sets” from other network machines and expanding the description to include simple VOIP phones, was inappropriate.
Classification disputes
The path also noted that the customs could not cancel their burden evidence in the re -classification of the device and incorrectly used the previous decision on the eligibility of liberation, not the classification of VOIP phones.
Subsequently, all three appeals of Reliance were allowed and the paths canceled higher requirements for the obligation.
The title 8517 of the Indian Customs Act includes telecommunications and transmission equipment. It includes phone sets (cords, wireless, cellular and VoIP) and other devices for transmission or receiving voice, images or data such as router and video conferencing systems. The correct classification of subjects below 8517 determines the relevant import rates.
This case emphasizes the recurring complexity of classification disputes in India’s tax regime.
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The tax authorities discussed whether to tax Parathas as a rotis, classify coconut oil as edible or cosmetic and apply different GST rates to popcorn, PANEERA analogs, pizza bases, top monitors, fertilizers and computer components. Such disputes often range from multiple levels, from the preliminary decision (AAR) to the tribunals, the Supreme Courts, and sometimes the Supreme Court, tensioning the Indian court system.
In July, the tax authorities also questioned Reliance over charter flight services used by the head of Reliance through their subsidiary Reliance Commercial Deilers LTD (RCDL). The tax department argued that RCDL effectively rented the aircraft to Reliance, which should attract higher taxes similar to the rental of the equipment. RCDL claimed that it provided air transport services and deserved taxation at standard airline rates.
The aim of recent Indian GST reforms is to reduce such conflicts. The GST Council has simplified the indirect tax structure and reduced the plates of the rate from four to two, 5% and 18%, with 40% of the collection for SIN goods.
Within this framework, most phones, including VoIP and top devices, will now attract 18% of GST, regardless of their category, offering clarity and relief to industry and consumers.
(Tagstotranslate) Customs Department Mumbai (T) Supreme Court (T) of Reliance Group
