TaxTMI 
TaxTMI 
2021 (3) TMI 27
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....ergone by the imported goods. The goods were examined by the officers of FTZ and they were of the view that since the imported betel nut (Areca-nuts) are "whole" nuts and are classifiable under CTH 08028010, it is a prohibited item for import as the CIF value of the goods is lesser than Rs. 251/- per kg. 3. On reasonable doubt, samples were drawn and sent for examination to the Chemical Examiner, Customs Laboratory, Customs House, Chennai. The Chemical Examiner stated that it could not be ascertained whether the betel nuts are boiled / roasted. It was also stated that it is free of cardamom and added food starch. On the view that various processes as claimed by the appellants in their write up having not been undertaken to make the betel nut 'product of betel nut' or 'preparations containing betel nut', the assessing officer held that the impugned goods do not merit classification under CTH 21069030 as claimed by appellant. The assessing authority passed speaking orders and in both the cases he rejected the classification claimed by the appellants and held the goods to be classified under 08028010. 4. Against such order appellants approached the Commissioner (Appeals) who vid....
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.... -- Desiccated kg. 70% 60% 0801 12 -- In the inner shell (endocarp) : 0801 12 10 --- Fresh kg. 70% 60% 0801 12 20 --- Dried kg. 70% 60% 0801 12 90 --- Other kg. 70% 60% 0801 19 -- Other : 0801 19 10 --- Fresh kg. 70% 60% 0801 19 20 --- Dried kg. 70% 60% 0801 19 90 --- Other - Brazil nuts : kg. 70% 60% 0801 21 00 -- In shell kg. 30% 20% 0801 22 00 -- Shelled - Cashew nuts : kg. 30% 20% 0801 31 00 -- In shell kg. 30% Free 0801 32 -- Shelled 0801 32 10 --- Cashew kernel, broken kg. 30% 20% 0801 32 20 --- Cashew kernel, whole kg. 30% 20% 0801 32 90 --- Other kg. 30% 20% 0802 OTHER NUTS, FRESH OR DRIED, WHETHER OR NOT SHELLED OR PEELED ALMONDS 0802 11 00 --In shell kg. Rs. 35 per kg. Rs. 30 per kg. kg. Rs. 100 per kg. &....
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.... 0910; (e) food preparations, other than the products described in heading 2103 or 2104, containing more than 20% by weight of sausage, meat, meat offal, blood, fish or crustaceans, molluscs or other aquatic invertebrates, or any combination thereof (Chapter 16); (f) yeast put up as a medicament or other products of heading 3003 or 3004; or (g) prepared enzymes of heading 3507. 2. Extracts of the substitutes referred to in Note 1 (b) above are to be classified in heading 2101. 3. For the purposes of heading 2104, the expression "homogenized composite food preparations" means preparations consisting of a finely homogenised mixture of two or more basic ingredients such as meat, fish, vegetables, fruit or nuts, put up for retail sale as food suitable for infants or young children or for dietetic purposes, in containers of a net weight content not exceeding 250g. For the application of this definition, no account is to be taken of small quantities of any ingredients which may be added to the mixture for seasoning, preservation or other purposes. Such preparations may contain a small quantity of visible pieces of ingredients. SUPPLEMENTARY NOTES : ....
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....dients. 6. Tariff item 2106 90 99 includes sweet meats commonly known as "Misthans" or "Mithai" or called by any other name. They also include products commonly known as "Namkeens", "mixtures", "Bhujia", "Chabena" or called by any other name. Such products remain classified in these sub-headings irrespective of the nature of their ingredients. Tariff Item Description of goods Unit Rate of duty Standard Preferential Areas (1) (2) (3) (4) 5 2101 EXTRACTS, ESSENCES AND CONCENTRATES,OF COFFEE, TEA OR MATE AND PREPARATIONS WITH A BASIS OF THESE PRODUCTS OR WITH A BASIS OF COFFEE , TEA OR MATE ; ROASTED CHICORY AND OTHER ROASTED COFFEE SUBSTITUTES, AND EXTRACTS, ESSENCES AND CONCENTRATES THEREOF - Extracts, essences and concentrates of coffee,and preparations with a basis of these extracts, essences or concentrates or with a basis of coffee : 210111 -- Extracts, essences and concentrates: 21011110 --- Instant coffee, flavoured....
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...."Supari" means any preparation containing betel nuts, but not containing any one or more of the following ingredients, namely, lime, katha (catechu) and tobacco whether or not containing any other ingredients, such as cardamom, copra or menthol. The goods proposed to be imported are food preparation containing betel nuts, but not containing lime, katha (catechu) and tobacco. The said goods, in addition to betel nut, may contain liquid flavors like perfume etc., food starch and spices like mulethi, and betel nut is boiled/roasted and/or cut, sliced into small pieces. As per Supplementary Note 2 ibid the condition for a preparation to be called betel nut known as "supari" is that preparation should be containing betel nuts, but not containing any one or more of the following ingredients, namely : lime, katha (catechu) and tobacco whether or not containing any other ingredients. As the impugned goods are preparation of boiled betel nuts but are not containing any one or more of the following ingredients, namely: lime, katha (catechu) and tobacco, the said preparations are betel nut preparations known as "supari". This is borne out by the said Supplementary Note which states that the p....
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....ter 8. Therefore, boiled supari which is altogether different from the source product raw supari as obtained from the trees is classifiable under CTH 21069030 and not under CTH 08028010 as held by the department. 5.7 In this regard the Advance Ruling given by the Authority for Advance Ruling in the case of M/s Excellent Betelnut is relied. The ruling order reference AAR/CUS/08/2015 is referred in this ruling. The facts show that there were four types of supari on which slightly different processes were employed for processing of raw supari into ready to use edible supari. Out of these four, the process of API supari is akin to the process adopted by the exporter in the instant case where fresh green betel nut are taken and large impurities are removed by labor and then small impurities. Further, process of metal detection (removal of metal items if any) boiling in water with Arecanut precipitate for 6 hrs., drying in oven and packing etc. is completed. The authority for advance ruling held that even such suparis by the name of API Supari which are in fact boiled betel nut converted into boiled supari and edible are classifiable under CTH 2106930. 5.8 The Commissioner (Appeals....
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....nd the ingredients and it is beyond hs purview to give a report on the classification of the product and the chapter/heading where it is covered. In this regard a reliance is placed on the CESTAT decision in the case of Commissioner of C. Ex., Ahmadabad vs. Dhariyal Chemicals reported in 2014 (309) ELT 727 (Tri.-Ahmd.) wherein it was held that the scope of expert opinion is restricted to chemical analysis and not to classification of the product. 5.13 The Ld. Commissioner (Appeals) has erred in not giving consideration to the fact that to the test report dated 23.11.2020 of the Scientific Food Testing Services Pvt. Ltd. wherein it was reported that sample conform to Betelnuts (Boiled Supari) (21069030) conforms to the requirements as laid down under 2.3.55 of Food Safety Standards (Food Products). Further vide sl.no.6 of the tabular column the prescribed limit of moisture in the imported item should not be more than (NMT) 7.0gm/100g the ascertained value reported as 5.84g & 5.158/100g which is well below the norms prescribed as per the (Food Products Standards & Foods Additives) Regulations, 2011. The analysis report by the said agency confirms that the subject goods were subjec....
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.... Then the large and visible impurities are removed labor and the non-visible impurities are removed by the De-stoner. This is followed by metal removal by deflectors of the metal. Then the product obtained is boiled in water for around 6 hours. The cleaned product is now polished in the machine - these machines are particularly customized for this very purpose and entails a huge investment. The product is then cut in three stages and the very fine particles created due to the process of cutting are then blowed away by the help of a blower. Not limiting the process till here, the even finer particles are then gravity separated by the automatic gravity separation machine which again entails a huge investment. The last part of the process is to give the product a look and feel by roasting it fire gas roaster and add cardamom and any other relevant spices. Even at this stage also, any metal, if detected, is removed by magnetic metal detectors and after that the product is packed. It is thus, evident and imminently clear that with such a rigorous manufacturing process the classification of the raw material is bound to change and therefore, cannot be classified under 0802 but th....
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.... a) For additional preservation or stablisiation (for example, by moderated heat treatment, sulphuring, the addition of sorbic acid or potassium sorbate). b) To improve or maintain their appearance (for example, by additional of vegetable oil or small quantities of glucose syrup)." "Provided that they retain the character of the dried fruit or dried nuts." The heading 080280 is as under :- "080280 - Areca nuts: 08028010---Whole" 14. From above Note 3, it can be seen that even if some stage of drying or rehydrating or treatment is done for preservation / stabilization or maintaining the appearance, as long as the nuts retain the character of dried nuts, they fall under Chapter 8. The counsel for appellants had placed before us samples of dried whole betel nut (without husks) as well as sample of the imported goods. We were able to see that the imported goods are also whole but more dried. 15. Ld. Counsel for appellants has referred to Chapter Note 2 of Chapter 21 to strongly contend that the goods would fall under CTH 21069030. From the table reproduced earlier, it can be seen that CTH 21069030 takes in the items "betel nut pr....
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....orks (supra) an amendment was introduced in Chapter 21 whereby Supplementary Chapter Note 2 to Chapter 21 was introduced. Further, that product known as 'supari' is excluded from Chapter 8. It is argued by him that in view of the above change in Chapter Notes, the judgment of the Hon'ble Supreme Court does not have bearing to the present day classification of betel nut known as 'suprai' in the market. Ld. Counsel has largely harped upon the word 'supari' to contend that the goods imported is a 'betel nut product'/supari as it has undergone process of boiling. 19. The word 'supari' only appears in Chapter 21. In ordinary parlance, the 'product of betel nut' is known in the market as 'supari'. The appellant has no contention that they have added any ingredients. The Chemical Examiner's report states that it is free of cardamom. It is also stated by the Examiner that it is not possible to ascertain whether the nuts are boiled. Though the Food Safety authority in their certificate has used the words 'boiled suprari', it is of not much support to the appellants as this authority has only to look into whether goods imported are fit for human consumption or not. Even sun dried / or mac....
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....ed that the contention of Revenue that in order to fit in chapter 21, supra, which is also known as betel nut should undergo a different character change, meaning it should not remain suprai is incorrect due to the positive language of Supplementary Note No.2 which does not require any such basic change in the character of the product like betel nut. Further, this Authority observed the reliance by Revenue on the decision of Hon'ble Supreme Court in case of M/s.Crane Betel Nut Powder Works was completely uncalled for as it was in respect of Central Excise Act and also after said judgement, an amendment was brought in the Central Excise Tariff by way of Chapter Note No.6 to Chapter 21. In view of said ruling of this Authority in case of M/s.Excellent Betel Nut Products Pvt. Ltd. it is clear that Supplementary Note 2 to Chapter 21 to the Customs Tariff does not require any change in the nature of the end product and also reliance on the Hon'ble Supreme Court judgment in case of M/s.Crane Betel Nut Powder Works (supra) is not appropriate . It is further noticed that CTH 0802 covers only fresh and dried Areca Nuts/ Betel Nuts. All items proposed to be imported except "Unflavoured Supar....