2026 (2) TMI 245 - AT - Customs

Calcium Nitrate with Boron import classification denied customs exemption under Notification; product treated as fortified boronated fertilizer.

Imported calcium nitrate with added boron was held not to qualify for an exemption under Notification No.12/2012-Cus because the Fertilizer Control Order ... Water-soluble fertilizer - imported ‘Calcium Nitrate with Boron’ - duty exemption under Notification No.12/2012-Cus - Fertilizer Control Order specifications - classification as fortified fertilizer - strict interpretation of exemption notification - HELD THAT:- As seen from the above Notification, the water-soluble fertilizers included in schedule-1 Part-A of the FCO are eligible for the benefit of 5% Basic Customs Duty. Admittedly, the item imported is boronated calcium nitrate, the only question that arises is this a water-soluble fertilizer and even if a negligible percentage of boron is added to it, whether it still remains to be calcium nitrate to enjoy the benefit of the Notification. We find that the Fertilizer Control Order, 1985 under the category of Fortified Fertilizers at Sl.No.9 Calcium Nitrate with Boron is mentioned wherein under the specifications column water soluble calcium is 17.1% and Boron by weight is 0.250. In the instant case, the Boron content in the product imported by the appellant is to the extent of 0.3% and as claimed by the Revenue it appears that the product is rightly classifiable under the category of Fortified Fertilizers. We also find that I(h) under the FCO under the category of 100% water-soluble complex fertilizers calcium nitrate is included under which water insoluble is 1.5%. Since, calcium nitrate with boron under Sl.No.9 under the category of Fortified Fertilizers matches to the specifications given by the appellant for the product imported by them, the benefit of the Notification meant for water-soluble fertilizers cannot be extended. Accordingly, we find justification of the Revenue in denying the benefit of the Notification. It is also on record that ‘Yaraliva Nitrabor’ imported by the appellant with the addition of boron to calcium nitrate increases elasticity of tissues to prevent cracking of tissues which clearly acknowledges the fact that calcium nitrate is different from boronated calcium nitrate. The Notification is for calcium nitrate and not for boronated calcium nitrate, therefore, as observed by the Hon’ble Supreme Court in the case of Commissioner of Customs (Import), Mumbai vs. Dilip Kumar & Company [2018 (7) TMI 1826 - SUPREME COURT (LB)] words cannot be included into the Notification since an exemption Notification has to be strictly interpreted. Therefore, the benefit of the Notification cannot be extended wherein the Notification clearly mentions only the calcium nitrate and even in the FCO, 1985 only calcium nitrate is mentioned under the category of water-soluble fertilizers, the fact that it is water-soluble as claimed by the appellant will not change the fact that calcium nitrate is different from boronated calcium nitrate. In view of the above, we are in the agreement with the Revenue that the benefit of the Notification No.12/2012-Cus. dated 17.03.2012 cannot be extended. Thus, the impugned order is upheld and appeals are dismissed. Issues: Whether boronated calcium nitrate (Yaraliva Nitrabor) imported and classified under CTH 3102 6000 qualifies as a 'water soluble calcium nitrate' within Sl. No.202(I)(b) of Notification No.12/2012-Cus dated 17.03.2012 and is therefore eligible for the exemption under that notification.Analysis: The question turns on whether the imported product falls within the description and specifications of water-soluble calcium nitrate in Part-A of Schedule-1 of the Fertilizer Control Order, 1985 and the entries in Notification No.12/2012-Cus. The product contains boron and shows specified values for water insoluble matter and other parameters that correspond to the category of fortified fertilizers under the FCO. The notification grants exemption specifically to listed water-soluble fertilizers meeting the FCO specifications. Exemption notifications are to be interpreted strictly, and eligibility depends on the product matching the description and specifications set out in the FCO and the notification entry. The presence of boron and the matching of specifications to the fortified fertilizer entry indicate a different category from plain calcium nitrate listed for exemption.Conclusion: The boronated calcium nitrate (Yaraliva Nitrabor) does not qualify as the water-soluble calcium nitrate covered by Sl. No.202(I)(b) of Notification No.12/2012-Cus dated 17.03.2012; the exemption is not available.