TaxTMI 
TaxTMI 
2022 (1) TMI 621
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....New Delhi in terms of Section 28F(3) ibid and Regulation 31 of CAAR Regulations, 2021. 3. On perusal thereof, and in view of the time limit of three months for pronouncing its advance rulings from the date of receipt of this application prescribed under Section 28-I(6) ibid, it was held that the aforesaid application received in the O/o AAR, New Delhi on 24-9-2020 had become time barred for this Authority. 4. However, on constructive interpretation of the powers vested with this Authority, vide letter dated 18-2-2021, the applicant was advised to intimate whether they continued to be interested in obtaining ruling of this Authority, and if so either resubmit their application in the Form CAAR-I appended to Customs Authority for Advance Rulings Regulations, 2021, or simply affirm that the declarations made in the earlier application remain valid and unchanged, at the earliest to this Authority. It was also informed that the date of receipt of such resubmitted application or affirmation, as the case may be, shall be taken as the date of receipt of their application under Regulation 8(4); and no separate payment of the prescribed fee under Regulation 6(6) of CAAR Regul....
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....ana, in his comments dated 12-11-2020 referred to the judgment in the case of A.R.S. Company Ltd. v. Commissioner of Central Excise, Trichy reported as 2015 (324) E.L.T. 30 (S.C.), wherein referring to the decision in the case of M/s. Crane Betel Nut Powder Works, it was held that crushing betel nuts into smaller pieces and sweetening the same with essential/non-essential oils, menthols, sweetening agents etc. did not result in manufacture of a new and distinct product. Referring to his earlier submissions on the issue of classification of the goods under consideration, they have requested that the same may be accepted as comments in the present application also. I accept the said request and will refer to their detailed contentions previously submitted while examining the merits of the case later in this order. In this regard, I note that the concerned Commissioner of Customs, viz. Commissioner of Customs, Tuticorin has commented that any process which changes basic nature of the original product betel nut would result in a product that would fall under Chapter Heading 2106 90 30. 8. In accordance with the procedure prescribed under the CAAR Regulations, 2021. personal hea....
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....d out on the betel nut, various product cited by them in their application are classifiable under Chapter 21 of the Import Tariff in line with Supplementary 2 of Chapter 21, as ruled by the erstwhile AAR in the cases cited by him. 9. As per Annexure-I of the application, it is submitted that the applicant proposes to import a preparation of Betel Nuts known as "Boiled Supari" packed in consumer packing and bulk packing. It is stated that the principal raw material used by the foreign manufacturer for the proposed import goods is raw betel nut covered under Chapter 8, specifically falling in Heading 0802 90 00 of the Schedule to the Customs Tariff Act, 1975. The process of preparation of the import item is given as under : (i) 'API Supari' : Following processes are conducted on raw green fresh betel nut : removing of large impurities by labourers, boiling in water for 6 hours, mixing food starch, drying, polishing and packaging. (ii) 'Chikni Supari' : Following processes are conducted on raw green fresh betel nut : removing of large impurities by labourers, slicing in small pieces, boiling in water f....
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....0 30 as Food Preparation." 10. Finding that the application is valid in terms of the provisions of the Customs Act and the CAAR Regulations, 2021, having received the comments of the concerned Principal Commissioner(s)/Commissioner(s) of Customs, and having heard the applicant in virtual mode, I proceed to examine the question on merits. 11. The applicant proposes to import goods said to be preparation of betel nuts known as "Boiled Supari" but on the basis of processes involved in the preparation of Supari, six different types of Supari have been mentioned. It is also pertinent to mention that in Unflavoured and Flavoured Supari, process of boiling of betel nut is absent. It is stated that the principal raw material used by the foreign manufacturer for the proposed import goods is raw betel nut covered under Chapter 8, specifically falling in Heading 0802 90 00 of the Schedule to the Customs Tariff Act, 1975. The process of preparation of the import item has been given wherein apart from preparation of Boiled Supari, process of preparation involved in a number of other product, namely, API Supari, Chikni Supari, Unflavoured and Flavoured Supari has also been elabor....
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....basis of the submissions of the applicant, along with the cited reference to the ruling of the erstwhile AAR and the submission of the concerned Principal Commissioner(s)/Commissioner(s) of Customs, along with reliance on the judgment of the Hon'ble Supreme Court/Hon'ble High Court and the CESTAT, there are two contending entries in the CTH for the aforesaid different types of Supari/areca nut/betel nut, viz. sub-heading 2106 90 30 and sub-heading 0802 80 90. Therefore, it would be useful to carefully consider the two competing tariff entries and the guidance relating thereto. 14.1 Chapter 8, which covers Edible fruit and nuts; peel of citrus fruit or melons includes, inter alia, the following Note 3: - '3. Dried fruits or dried nuts of this Chapter may he partially rehydrated, or treated for the following purposes : (a) For additional preservation or stabilization (for example, by moderate heat treatment, sulphuring, the addition of sorbic acid or potassium sorbate); (b) To improve or maintain their appearance (for example, by the addition of vegetable oil or small quantities of glucose s....
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....processes that raw betel nuts were subjected to obtain the said four goods. Further, AAR was of the opinion that the decision of the Hon'ble Supreme Court in the case of M/s. Crane Betel Nut Powder Works reported at 2007 (210) E.L.T. 171 (S.C.) has no application in the facts of the cases before them. It is my considered opinion that in order to arrive at the appropriate classification of the said different types of goods, all originating from common source viz. raw green fresh betel nut, a more comprehensive view needs to be taken than in the aforesaid M/s. Excellent Betelnut case. 17. Having gone through the advance ruling application, supporting arguments for classification of the said goods under Chapter 21 as preparations of betel nuts, precedence of erstwhile AAR in support of the said classification, contention of the concerned Principal Commissioner(s)/Commissioner(s) of Customs, case laws relied by them to argue the appropriate classification of the said goods, I proceed to give ruling on the question posed for advance ruling. 18. Advance ruling has been sought on classification of six different goods, each known as "supari" in common trade parlance, albeit....
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....d set for enhancing appearance or presentation, which are clearly covered by the Chapter Note 3 to Chapter 8. Addition of starch would be included under such process. I note that the Learned Advocate was vehement in his contention that process of boiling, being irreversible in nature, would result in bringing into being a new product and be eligible to be called a preparation of betel nut. He also contended that boiled supari cannot be classified under the said sub-heading of Chapter 8. I readily admit that boiling is an irreversible process, a boiled betel nut would be distinct from unboiled betel nut, and a boiled betel nut cannot be "unboiled" in reverse. However, it is equally obvious that boiling per se does not result in obtaining a preparation of betel nut. Speaking more generally, in view of the design of the Schedule to the CTA, HSN and plethora of judgments, besides common understanding and parlance, every irreversible process does not result in obtaining a new product with a distinct classification even at the eight or ten-digit level; and every irreversible process does not result in coming into being of a "preparation of the raw material". Notwithstanding the vehemence....