TaxTMI 
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2021 (3) TMI 27
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.... 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 vide order impugned herein upheld the conclusions a....
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....0 --- 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. Rs. 95 per kg. Hazelnuts or filberts (Corylus spp.): 0802 21 00 --In shell kg. 30% 20% 0802 22 00 -- Shelled kg. 30% 20% Walnuts : 0802 31 00 -- In shell kg. 30% 20% 0802 32 00 -- Shelled kg. 30% 20% ....
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....sic 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 : 1. In this Chapter, "Pan masala" means any preparation containing betel nuts and 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. 2. In this Chapter "betel nut product known as 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. 3. For the purposes of tariff item 2106 90 11, the expression "Sharbat" means any non-alcoholic sweetened beverage or syrup containing not less th....
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....TES 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 kg. 30% - 21011120 --- Instant coffee, not flavoured kg. 30% - 21011130 --- Coffee aroma kg. 30% - 21011190 --- Other kg. 30% - 21011200 -- Preparations with basis of extracts, essences, concentrates or with a basis of coffee kg. 30% - 21041010 --- Dried kg. 30% - 21041090 --- Other kg. 30% - 21042000 - Homogenised composite food preparations kg. 30% - 21050000 ICECREAM AND OTHER EDIBLE ICE, WHETHER OR NOT CONTAINING COCOA kg. 30% - 2106 FOOD PREPARATIONS NOT ELSEWHERE SPECIFIED OR INCLUDED 21061000 - Protein concentrates and textured protein substances kg. *40% - 210690 - Other : --- Soft drink concentrates : 21069011 ---- Sharbat kg. 150% - 21069019 ---- Other kg....
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.... states that the preparation will remain betel nut known as "supari" if it is containing betel nuts but not containing lime, katha (catechu) and tobacco irrespective of whether or not containing any other ingredients, such as cardamom, copra or menthol. This view also finds support from Rule 2(b) of General rules for the interpretation of Import Tariff which states that any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combination of that material or substance with other material or substance. Further, Rule 3 (a) of the General Rules for the Interpretation of the Schedule clarifies that the Heading which provides the most specific description shall be preferred to headings providing a more general description. The impugned goods are prepared by cleaning, boiling and the same shall be classified as if they consisted of the betel nut product known as "supari" which gives the preparation their essential character as preparation of betel nut product. Moreover, in the Customs Tariff as well as in the Central Excise Tariff the item under reference is specifically covered under Tariff item 21069030. 5.4 The issue of classification ....
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....(Appeals) has erred in not relying upon the advance ruling cited above merely on the ground that the Advance Ruling is applicable to the applicant only who has sought it from the authority. This advance ruling has wider application as it is in consonance with the chapter notes and the section notes in the customs tariff and the central excise tariff. Moreover, the API supari covered in the aforesaid ruling is exactly applicable to the boiled supari imported by the appellant and therefore, the ruling is fully applicable to the instant case. 5.9 As stated above, since the initial process of manufacture was inadvertently given by the foreign supplier for chikni supari due to typing error by the staff of the exporter a fresh certificate for the boiled supari along with flow chart which has been attached in the present appeal duly mentioned in the index. 5.10 The observations made by Commissioner (Appeals) that the Hon'ble Madras High Court judgment is not applicable as according to this the Advance Ruling is applicable only to the applicant is not correct because the Hon'ble High Court has held that the advance ruling is also applicable to the Commissioner of Customs. The second Adva....
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....iling in water for 6 to 8 hrs and sun dried, hence the moisture content is reduced to 5.15g as against in the prescribed limit of 7.0g/100g. The FSSAI is also a Government body and their report about the edible nature of the product in the condition where it was imported cannot be discarded. 5.14 Further, the ld. Commissioner (Appeals) has erred in not relying upon the case of Columbia Sportswear co. vs. Director of Income Tax, Bangalore reported in 2012 (283) ELT 321 (SC)] where it has been held that the boiled supari are made ready for human consumption. 5.15 It is further submitted that M/S Oliya Steel had also approached the Hon'ble Authority for Advance Ruling (AAR for short) Delhi where the identical product was an issue. 5.16 The above finding of the AAR is an interpretation of the wordings used in the statute and not only a plain and simple Ruling. It is a proclamation which defines the difference between product of Chapter 8 and products of Chapter 21. The difference is that as soon as the product is boiled, the same cannot remain fresh and dried which is a requirement for classification under heading 8 of the Custom Tariff. 6. It is therefore, submitted that the produ....
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....0 worldwide." 11. In this letter it has been stated that betel nuts have been subjected to several processes and then imported. However, the report of the Chemical Examiner does not show that impugned goods have been subjected to any of these processes. At the time of arguments before this Tribunal, as also before the lower authority, the main contention put forward by the counsel for appellants is that the betel nuts were subjected to boiling in water for 6 to 8 hours and dried in sun light and the moisture content is reduced considerably. It was also argued that betel nuts are edible only and after being subjected to the process of boiling. Ld. Counsel relied on SFTS report dt. 23.11.2020 to argue that goods imported conform to betel nuts (Boiled Supari) which are fit for human consumption. 12. The betel nuts which are 'whole' nuts and classifiable under CTH 08028010 are prohibited for import if the CIF value of the goods is lesser than Rs. 251/- per kg. The declared quantity of the goods in appeal filed by Ayush Overseas is 79,520 tons valued at Rs. 89,63,892/- @ Rs. 112.75 per kg. Thus, if the classification is under Chapter 8, the import of these nuts would be against the pr....
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....betel nut 'whole' as seen in Chapter 8. Chapter Note 2 of Chapter 21 also speaks about 'betel nut product' and not betel nut 'whole'. As per Chapter Note 2 of Chapter 21 'betel nut product' means any preparation containing betel nut, but not containing lime, katha and tobacco. It may or may not contain cardamom, copra, or menthol. The appellants do not have a case that their goods contain cardamom, copra or menthol or any additives. Counsel for appellants has made much effort to contend that after boiling though 'whole' the betel nut becomes 'betel nut product'. In our view, since betel nut has retained its character of being whole and it does not contain any other ingredients such as cardamom, copra or menthol, it cannot be said that impugned goods are 'preparations containing betel nut' or 'betel nut product/supari' so as to fall under tariff heading 21069030. 16. To arrive at this conclusion, we are also supported by the decision of the Hon'ble Supreme Court in the case of Crane Betel Nut Powder Works Vs CC & CE Tirupathi - 2007 (210) ELT 171 (SC). The facts of the case before Hon'ble Apex Court was that the assessee was marketing betel nuts after cutting into different sizes a....
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....mful elements. From the appearance of the 'betel nuts whole' (imported) placed before us we are not able to conclude whether these nuts are boiled and then dried or only dried. Although in the report of Chemical Examiner and FSSAI the competing classifications have been mentioned, we do not find any evidence to support that various processes as stated in the write up of the supplier has been undertaken on the nuts. We do not have quarrel with the position that the Chemical Examiner, FSSAI authority or the Foreign Supplier cannot decide the classification of goods. 20. The question is whether by mere boiling and drying whole betel nut it would merit classification under 21069030 so as to surpass the prohibition of import. Ld. counsel for appellants has relied upon Advance Rulings in the case of M/s.Excellent Betelnut and M/s. Oliya Steel Pvt. Ltd. Needless to say that the said decision is binding and applicable to the parties to the litigation only. Be that as it may, going through the ruling in the said case the goods imported are various kinds of supari namely API Supari, Chikni Supari, Unflavoured Supari and Flavoured Supari and Boiled Supari. It is stated that in para-1 of the ....
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.... of the applicant that said items would not merit classification under 0802. 11. Revenue also submits that in respect of applicant's claim that in case of "API Supari", Betel nut is boiled for 6 hours, cannot be conclusively proved and hence not ascertainable, it is noticed from the process of preparation submitted by the applicant in respect of "API Supari" that it is not restricted to boiling betel nut for 6 hours but includes removing of large impurities by labour, boiling in water for 6-8 hours with lemon peel and/or food starch for imparting goods texture to product, drying, polishing and packaging. Therefore, exact hours of boiling of betel nut is not so significant in said process of preparation than its boiling in water with lemon peel and/ or food starch for the purpose of imparting texture to the product as also other processes. Therefore, contention of Revenue is not correct." The goods were held to be classified under 21069030 as food preparation by the Advance Ruling Authority. These rulings would apply only to the parties therein and is not a binding precedent for other cases. 18. In Empire Industries Ltd. Vs UOI - 1985 (20) ELT 179 (SC) which is seen referred, th....