TaxTMI 
TaxTMI 
2021 (5) TMI 1066
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....02.2021 of their counsel, Shri Somesh Arora which was received in the Secretariat of CAAR, New Delhi on 01.03.2021. The application was accordingly registered under serial No. 02/2021 -Delhi dated 01.03.2021. 3. On registration of the application, the concerned Principal Commissioner/Commissioner of Customs were requested vide letter dated 05.03.2021 to furnish their comments, in the matter. In this regard, comments of the concerned Commissioner of Customs, Custom House, Mundra, has been received, wherein it is inter-alia stated that it is undoubtedly clear that Areca Nut dried also known as supari whole or split, are rightly classifiable under CTH 0802. Further, referring to the Chapter Notes of Chapter 8, it is stated that since the applicant submitted that they are going to import whole raw green fresh Betel Nut/boiled Betel Nut; Chikni Supari; Unflavoured Supari; and Flavoured Supari, which is not in powder form, the product "Betel Nuts" rightly falls under CTH 0802 of Customs Tariff Act, 1962. Further, since whole raw green fresh Betel Nut/boiled Betel Nut do not fall under CTH 21069030 benefit of exemption of Notification No. 50/2017-Customs dated 30.06.2017 listed under Sr.....
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.... it is submitted that the question was duly addressed in the enclosed ruling of M/S Excellent Betelnut Products Pvt. Ltd., Nagpur in Para 5, 6, 7 & 10 and also in Para 10 of the decision of M/S Oliya Steel Pvt. Ltd., Kolkata, which after considering the relevant headings of Chapter 8 and Chapter 21 as well as the Chapter Note concluded that Betel nuts once boiled etc. go beyond the description of "Fresh and Dried" and enter the domain of preparation. Attention is also drawn to 2018 (363) E. L. T. 1039 (Tri.- Mum.), in the matter of HLL Life Care Ltd. Vs. Commissioner of Customs, (ACC & Imports), Mumbai, (enclosed in Synopsis) which though is a decision in favour of the Revenue decides as to when a product ceases to be as per its original Tariff Entry and moves on to become a preparation. In Para 4 (reproduced below) the Lordships observed as follows: Para 4: "From the plain reading of above both the Tariff Entries it is seen that Heading No.3006.60.10 is not for the basic hormones but it is meant for preparation of chemical contraceptives based on Hormones. Therefore, the product falling under Chapter Heading 3006 is a preparation which is one step ahead of the basic Hormones an....
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....omatic gravity separation machine, roasting in fire gas rotary roaster, flavoring in large size automatic blenders with compound, metal deflection by magnetic metal deflectors, sterilizing to kill bacteria count increased due to handling in processing and packaging. Then flavors such as flavoring materials like spices/or mulethi etc. are mixed in automatic blenders with outsourced liquid flavors such as perfumes etc. in mega size automatic blenders with compound. (v) 'Boiled Supari': Following processes are conducted on whole raw green fresh betel nut: removing of large impurities by labourers, boiling in water for upto 4 hrs, removing the husk, boiling again for 2 hours, drying by hot air, sterilizing, sorting, polishing and packaging whole boiled betel nut. After mentioning above details and processes involved in making of various type of Supari, the question (as stated in para 4 of Annexure l) on which advance ruling has been sought is, "As to whether the products described as above and known as API supari. Chikni supan, Flavoured supari, Unflavoured supari and Boiled supari merit classification in Chapter 8 (Tariff Heading or under Chapter 21 of 'Customs Ta....
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....any preparation containing betel nuts but not containing any one or more of the following ingredients, namely lime, katha (catechu) and tobacco or not containing any other ingredients such as cardamom, copra or menthol". They have also cited reference to ruling of the erstwhile AAR, New Delhi in the case of M/S Excellent Betelnut Products Pvt. Ltd, M/S Oliya steel Private Limited, Kolkata. I will revert to these in my discussion later in the order. 8. on the basis of the submissions of the applicant, along with the cited reference to the ruling of the erstwhile AAR, there are two contending entries in the CTH for the aforesaid five 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 ....
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....hapter 8, but rejected the same. However, while doing so, the erstwhile AAR did not make any comment on the implications of the Chapter Note 3 to Chapter 8 on the 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 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 five 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 five different goods, each known as "supari" in common trade parlance, albeit with different....
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.... M/S Samreen International Pvt. Ltd, Chennai, other similar rulings, and my own ruling in the case of M/S Star Spices and other similar rulings. 17. To answer the posed question, I consider the four goods, namely API supari, Chikni supari, unflavoured supari and boiled supari together. In these cases, one set of processes are found to be intended for cleaning; the second set for enhancing preservation; and third set for enhancing appearance or presentation. Addition of starch would be included under such process. I find that these processes are clearly covered by the Chapter Note 3 to Chapter 8. I also note that during the personal hearing, the learned advocate requested to consider the distinction arising out of moderate and heavy boiling. In this regard, it is also submitted in the application 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 after being boiled are dried; and this fact per se would not exclude the end-products from the scope of "dried nuts". Further, it is equally obvious to me that boiling or mere addition of certain addit....