2022 (2) TMI 629

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.... Secretariat of CAAR, New Delhi on 1-3-2021. The application was accordingly registered under Serial No. 3/2021-Delhi, dated 1-3-2021. 3. On registration of the application, the concerned Principal Commissioner/Commissioner of Customs were requested vide letter dated 2-3-2021 to furnish their comments, in the matter. However, comments of the concerned Principal Commissioner/Commissioner have not been received. 4. In accordance with the procedure prescribed under the CAAR Regulations, 2021, personal hearing was scheduled on 26-4-2021. However, Counsel of the applicant expressed his inability to appear for the hearing as he was detected corona positive and undergoing treatment. The Counsel also requested for an adjournment for at least two weeks from 26-4-2021. Accepting the request of the applicant, the CAAR fixed personal hearing on 25-5-2021 in virtual mode in view of lockdown in the city due to prevailing pandemic. Representing the applicant, Shri Shubhankar Jha, Advocate attended the hearing in virtual mode on the said date. During the hearing, Learned Advocate briefed about the classification question and products on which ruling has been sought. He mentioned th....

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....e gas rotary roaster, flavouring in large size automatic blenders with flavouring materials like spices/or mulethi, etc., are mixed in automatic blenders with outsourced liquid flavours such as perfumes, etc., sterilizing to kill bacteria count increased due to handling in processing and packaging. (v)     'Boiled Supari' : Following processes are conducted on raw green fresh betel nut : removing of large impurities by labourers, boiling in water for upto 4 hours, removing the husk, boiling again for 2 hours, drying by hot air, sterilizing, shorting, polishing and packaging. (vi)   'Cutting Supari' : Following processes are conducted on raw dried betel nut: removing of large impurities by labourers, removing of small impurities by de-stoner, metal deflection (removal of metal item, if any), garbling in automatic garblers, polishing in polishing machine, 5 stage cutting into small pieces, blowing of weightless particles in blower, gravity separation by automatic gravity separation machine, roasting in fire gas rotary roaster, metal deflection by magnetic metal detectors and packaging. After mentioning above details and processes inv....

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....with the cited reference to the ruling of the erstwhile AAR, there are two contending entries in the CTH for the aforesaid six goods, 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. 9. 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 be 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 syrup), provided that they retain the character of dried fruit or dried nuts.' 10. In the Chapter 8. areca nuts, whole, split, ground, and two residuary sub-headings are accommodated under 0802 80 10, 20, 30, 90, and 0802 90 00, respectively. 11.1 On the oth....

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....ed 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 four 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. 14. Having gone through the advance ruling application, supporting arguments for classification of the four goods under Chapter 21 as preparations of betel nuts, precedence of erstwhile AAR in support of the said classification, I summarize the contending positions on the question posed for advance ruling. 15. Advance ruling has been sought on classification of six different goods, each known as "supari" in common trade parlance, albeit with differentiator, viz. API, Chikni, Boiled, Cutting unflavoured and flavoured. The basic raw material for each of the six goods is raw betel nut, which is classifiable under Chapter 8, more specifically sub-heading 0802 80. I also note that Chapter 8 covers only edible nuts; inedible nuts and fruits being excluded by virtue of Chapter Note 1; and that betel nut/supari are....

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....ate raised the contention that with the process of boiling, betel nut loses the character of being fresh & dried nut, therefore, the item will not be covered under Chapter 8. I find that in the instant case betel nuts have been boiled and then dried, the eventual state of betel nuts being indeed dried. I do not agree with the submission that process of boiling would render the goods being excluded from being considered as dried. Further, it is obvious that boiling per se or the other processes mentioned by the applicant do 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 process, irreversible or otherwise, 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". Therefore, I conclude that the processes to which raw betel nuts have been subjected to obtain API supari, Chikni supari, unflavoured supari, boiled supari and cutting supari are squarely in the nature of pro....