Classification of flavoured retail-packaged snuff shifts to preparations containing snuff, not raw snuff, after further processing.

Further processing of duty-paid bulk snuff by adding flavouring substances, menthol and oils, then packing and labelling it for retail sale, takes the product out of the snuff entry and into the entry for preparations containing snuff of tobacco. Prior Tribunal authority was followed, and the contrary view was rejected. The practical effect is that retail-packaged, flavoured snuff is classified under sub-heading 2404.60 rather than 2404.50, with the classification adopted by the lower authorities set aside and relief granted subject to unjust enrichment.

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Issues: Whether the product obtained by adding flavours and menthol to duty-paid bulk snuff, followed by packing and labelling for retail sale, was classifiable as snuff of tobacco under sub-heading 2404.50 or as preparations containing snuff of tobacco under sub-heading 2404.60.

Analysis: The product was made by taking duty-paid snuff in bulk and subjecting it to further processing by mixing perfume, synthetic oil, essential oil and menthol, after which it was kept, packed in consumer packs and labelled for sale. The issue was covered by earlier Tribunal decisions holding that bulk snuff remained classifiable under sub-heading 2404.50, but that further processed snuff prepared for retail sale became a distinct preparation containing snuff of tobacco under sub-heading 2404.60. The prior Tribunal line of authority was followed, and the contrary view of the appellate authority was rejected.

Conclusion: The product was classifiable under sub-heading 2404.60 and not under sub-heading 2404.50, and the appeals succeeded in favour of the assessee.

Final Conclusion: The classification adopted by the lower authorities was set aside, and the assessee obtained relief, with consequential benefit left subject to unjust enrichment.

Ratio Decidendi: Further processing of duty-paid bulk snuff by adding flavouring substances and packing it for retail sale results in a preparation containing snuff of tobacco classifiable under the preparation entry rather than as raw snuff.

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