Specific tariff classification for nut-based drinks favours Heading 20.01 over residuary sharbat entry

Products described as "Badam Summer Sip" and "Thandai" were treated as preparations of almonds and other nuts, so they fell within Heading 20.01 rather than the residuary edible-preparations entry in Heading 21.08. The classification turned on the specific tariff coverage of nut-based preparations and the manufacturing process, not on the fact that the goods were sweetened or flavoured. Note 6 to Chapter 21 did not displace the more specific heading, and the sharbat sub-heading applied only where the product was not already covered elsewhere. The goods were therefore correctly classified under Heading 20.01.

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Issues: (i) Whether the products "Badam Summer Sip" and "Thandai" were classifiable under sub-heading 2001.10 as preparations of nuts or under sub-heading 2108.20 as sharbat.

Analysis: Heading 20.01 covered preparations of vegetables, fruit, nuts or other parts of plants, including such preparations whether or not containing added sugar or other sweetening matter. The manufacturing process showed that both products were preparations of almonds and other nuts, and therefore fell within the specific scope of Heading 20.01. Heading 21.08 was a residuary heading for edible preparations not elsewhere specified or included, and sub-heading 2108.20 applied to sharbat only where the product was not covered elsewhere. The Court held that Note 6 to Chapter 21 did not displace the more specific classification under Heading 20.01, and the cited precedent on badam-based drink mix was distinguishable on its facts.

Conclusion: The products were correctly classifiable under Heading 20.01 and not under sub-heading 2108.20; the Revenue's appeals failed.

Final Conclusion: The classification dispute was resolved in favour of the assessee because the goods were held to be preparations of nuts falling under the specific tariff entry rather than a residuary sharbat entry.

Ratio Decidendi: A product specifically covered by a tariff heading as a preparation of nuts cannot be shifted to a residuary edible-preparations heading merely because it is sweetened or flavoured.

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