Tariff classification of beverages as fruit juice based requires setting aside lemonade based demands and granting consequential relief.

The article addresses tariff classification of beverages and states that, under a prior Larger Bench ruling, the products at issue are classifiable under Chapter heading 22029020 as fruit pulp or fruit juice based drinks; consequently demands premised on classification under Chapter heading 22021020 (lemonade) for the period in question are to be set aside and the appellant granted consequential relief. The piece applies the binding precedent principle to substantially similar facts, holding that subsequent matters must follow the Larger Bench classification and that reclassification yields the stated operative effect.

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Issues: Whether the beverages in dispute are classifiable under Chapter heading 22029020 (fruit pulp or fruit juice based drinks) of the First Schedule to the Central Excise Tariff Act, 1985 or under Chapter heading 22021020 (lemonade) for the period February 2009 to December 2013.

Analysis: The Tribunal examined the classification dispute in light of the Tribunal's Larger Bench decision dated 30.04.2019 and the Division Bench's ruling in the appellant's prior matters. The Larger Bench held that the goods in question fall within tariff item No. 22029020 as fruit pulp or fruit juice based drinks. The Tribunal applied that binding precedent to the facts and the impugned orders framed under the relevant show cause notices for the period February 2009 to December 2013, noting that the earlier decisions in the connected matters support classification under CTH 22029020 rather than CTH 22021020.

Conclusion: The demand based on classification under Chapter heading 22021020 is set aside and the appeal is allowed; the goods are classifiable under Chapter heading 22029020, and the appellant is entitled to consequential benefits in accordance with law.

Ratio Decidendi: Where a Larger Bench has held that particular beverages are classifiable under tariff item 22029020 as fruit pulp or fruit juice based drinks, subsequent matters with substantially similar facts must follow that classification and set aside demands premised on classification under 22021020.

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