Tariff classification and GST rate for processed areca nut: specific dried areca nut entry , 5% rate applied.

Nizam Pakku was held to retain the essential character of areca nut after processing, so its classification under CTH 0802 8090 was upheld on the settled tariff position and the nature of the product. On GST rate, the notification entry for dried areca nuts was treated as clear and specific, and the product was accepted in trade and customs records as betel nut/areca nut. It therefore fell under the specific 5% entry rather than the residuary higher-rate entry for other dried nuts. The tariff classification was sustained, but the tax rate was held to be 5%.

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Issues: (i) Whether the product "Nizam Pakku" was correctly classified under CTH 0802 8090; (ii) whether the applicable GST rate was 5% or 12%.

Issue (i): Whether the product "Nizam Pakku" was correctly classified under CTH 0802 8090.

Analysis: The product was held to fall within Chapter 0802, and the 8-digit classification had already attained finality on the basis of the settled tariff position and the nature of the manufacturing process. The product retained the essential character of areca nut despite processing, and no reason was found to depart from the earlier classification under the residual 0802 8090 entry.

Conclusion: The classification under CTH 0802 8090 was upheld, against the assessee.

Issue (ii): Whether the applicable GST rate was 5% or 12%.

Analysis: The notification structure distinguished only between dried areca nuts and other dried nuts. The expression used in the rate entry for dried areca nuts was treated as clear and unambiguous, and the product was accepted in trade and customs documentation as betel nut areca nut. On that basis, and applying the GST notification entries, the product was held to answer the specific entry for dried areca nuts rather than the residual higher-rate entry for other nuts.

Conclusion: The applicable GST rate was held to be 5%, in favour of the assessee.

Final Conclusion: The appeal succeeded on the tax rate question, while the classification position under the tariff heading was not disturbed.

Ratio Decidendi: Where a tariff notification specifically covers dried areca nuts, a product commercially recognized as areca nut or betel nut and retaining that character after ordinary processing must be assessed under the specific entry and not the residuary higher-rate entry for other dried nuts.

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