Sugar confectionery classification prevails where coffee is only a minor flavouring ingredient, not the product's principal basis.

A product marketed as Kopiko Cappuccino and Espresso was held classifiable as sugar confectionery under Heading 1704 9090 because its predominant constituents were sugar and liquid glucose, while coffee extract was present only in a minor quantity as flavouring. Commercial identity, trade parlance, packaging, and the food-regulatory description supported treatment as candy rather than a preparation with a basis of coffee under Heading 2101 1200, which requires coffee to be the principal basis. Classification was found to be resolvable at Rule 1, or alternatively under Rule 3(a) as the more specific heading, so recourse to Rule 3(c) was unwarranted.

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Issues: (i) Whether the product 'Kopiko' Cappuccino and Espresso is classifiable under Heading 1704 9090 as sugar confectionery or under Heading 2101 1200 as preparations with basis of coffee. (ii) Whether, for such classification, recourse was properly taken to Rule 2 and Rules 3(a), 3(b) and 3(c) of the General Rules for the Interpretation of the First Schedule to the Central Excise Tariff Act, 1985.

Issue (i): Whether the product 'Kopiko' Cappuccino and Espresso is classifiable under Heading 1704 9090 as sugar confectionery or under Heading 2101 1200 as preparations with basis of coffee.

Analysis: The product was found to be predominantly composed of sugar and liquid glucose, with coffee extract present only in a very small proportion and used as a flavouring agent. On common trade parlance, packaging, commercial identity, and the food-regulatory description, it was treated as a sugar boiled confectionery or candy. Heading 1704 specifically covers sugar confectionery not containing cocoa, whereas Heading 2101 applies to preparations with a basis of coffee, which requires coffee to form the principal basis of the product. The presence of a small quantity of coffee extract did not alter the essential character of the product, and the classification evidence, including the comparable customs classification and FSSAI description, supported the assessee's case.

Conclusion: The product is classifiable under Heading 1704 9090 as sugar confectionery and not under Heading 2101 1200.

Issue (ii): Whether, for such classification, recourse was properly taken to Rule 2 and Rules 3(a), 3(b) and 3(c) of the General Rules for the Interpretation of the First Schedule to the Central Excise Tariff Act, 1985.

Analysis: Classification was held to be determinable at the stage of Rule 1 itself by reference to the terms of the headings and relevant chapter descriptions. Heading 1704 was found to be the more specific description for the product, while Heading 2101 was regarded as more general. Since the product was capable of classification under Rule 1 and, in any event, under Rule 3(a) as the more specific heading, there was no occasion to invoke Rule 3(c). The essential character and commercial understanding of the product did not justify departure from the specific heading for sugar confectionery.

Conclusion: Rule 1 and Rule 3(a) apply, and recourse to Rule 3(c) was unwarranted.

Final Conclusion: The reference was answered in favour of the assessee on classification, with the product held to fall under Heading 1704 9090 as sugar confectionery and the contrary view under Heading 2101 1200 rejected.

Ratio Decidendi: Where a product is commercially understood and described as sugar confectionery, and the alleged coffee component is only a minor flavouring ingredient, classification must follow the more specific heading for sugar confectionery under Rule 1 and Rule 3(a), rather than a more general heading for preparations based on coffee.

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