TaxTMI 
TaxTMI 
2025 (2) TMI 1311
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.... GST bearing Registration No.33CKNPP7716HIZS. The applicant is intending to import of following goods from the Chennai Port: a) Roasted Cashew nuts from Vietnam, Thailand and Malaysia. b) Roasted Areca nuts from Myanmar, Indonesia, Thailand and Sri Lanka. c) Roasted Almond nuts from United States of America and Australia. d) Roasted Pista nuts from Vietnam, Thailand and Malaysia. 1.1 The applicant is of the bonafide belief that the subject goods are rightly classifiable under 2008 19. Therefore, the present application is being filed to ascertain the correct classification and eligibility of Notification benefit for the following subject goods: S. No Subject Goods Proposed CTH Classification Proposed Eligibility of Notification Benefit 1. Roasted Cashew Nut CTH 200819 10 (1) SI. No. 172 of Notification No. 46/2011- Cus dated 01.06.2011 2. Roasted Areca Nut CTH 200819 20 (1) SI. No. 172 of Notification No. 46/2011- Cus dated 01.06.2011 and (2) List 5 of Notification No.26/2000-Cus dated 01.03.2000 (when imported from Sri Lanka) 3. Roasted Almond Nut CTH 200819 20 (1) SI. No.622 of Notification No.....
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....ssification of subject goods under the Chapter 08 is not suitable for the product which is roasted. F. Further, the classification of subject goods under CTH 2008 19 10 can be supported by General Rules of Interpretation Rule 3(a) of the which provides that when one classification provides a general description and another provides a more complete or precise description of the goods, then the classification which provides the precise description must be taken. In this case, the specific heading for roasted cashew nuts is 2008 19 10, which provides a more precise description than a general heading for nuts under Chapter 08. G. It is submitted that the HSN Explanatory Notes to Chapter 20.08 published by the World Customs Organization are reproduced below: "this heading covers fruits, nuts and other edible parts of plants, whether whole, in pieces or crushed, including mixtures thereof, prepared or preserved otherwise than by any of the process specified in other Chapters or in the preceding headings of this Chapter. It includes, inter alia: (1) Almonds, ground-nuts, areca (or betel) nuts and other nuts, dry-roasted, oil-roasted or fat-roasted, whether....
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....d Areca (or Betel) Nuts are specifically covered under Chapter Heading 2008. Reference is made to the case laws of L.M.L. Ltd. v. Commissioner of Customs reported in 2010 (258) E.L.T 321 (S.C), Holostick India Ltd. v. Commissioner of Central Excise, Noida reported in 2015 (318) E.L.T 529, Collector of Central Excise, Shillong v. Wood Craft Products Ltd reported in 1995 (77) E.L.T 23 (S.C.) to submit that the HSN Explanatory Note is the safe and dependable guide in the matters of classification of items. In the case of Collector of Customs, Bombay v. Business Forms Ltd reported 2002 (142) ELT 18 (S.C.), the Hon'ble court held that Explanatory Notes to HSN need to be given due consideration for classifying goods. L. It is submitted that the HSN Explanatory Notes to Chapter 20.08 published by the World Customs Organization are reproduced below: "this heading covers fruits, nuts and other edible parts of plants, whether whole, in pieces or crushed, including mixtures thereof, prepared or preserved otherwise than by any of the process specified in other Chapters or in the preceding headings of this Chapter. It includes, inter alia: (1) Almonds, ground-n....
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....and peel of citrus fruit or melons (including watermelons), generally intended for human consumption (whether as presented or after processing). As per HSN explanatory notes these goods may be fresh (including chilled), frozen (whether or not previously cooked by steaming or boiling in water or containing added sweetening matter) or dried (including dehydrated, evaporated or freeze-dried): provided they are unsuitable for immediate consumption in that state, they may be provisionally preserved (e.g., by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions). The note specifies the physical status of the goods along with corresponding processes that could be carried on those goods under this chapter. Note 3 to Chapter 8 further states that Dried fruit or dried nuts of this Chapter may be partially rehydrated, or treated for the following purposes: (a) for additional preservation or stabilisation (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 t....
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.... headings of this Chapter. Specifying what is included in this heading, the explanatory note states that Almonds, ground nuts, areca (or betel) nuts and other nuts, dry- roasted, oil-roasted or fat-roasted, whether or not containing or coated with vegetable oil, salt, flavours, spices or other additives. From the forgoing it can be seen that the subject goods i.e. find specific reference in the chapter 20 of the schedule I of the Customs Tariff Act, 1975 as well as corresponding HSN Explanatory Note. It is important to pay attention to the fact that in the above explanatory note a process of roasting is not specifically mentioned as a process of preservation or stabilization or a process to improve or maintain the appearance. R. It is submitted that on various online marketplaces like https://www.amazon.in/, https://indiamart.com, https://flipkart.com etc. roasted betel nuts as products are sold. This clearly indicates that the goods have both buyers and sellers and that they are known in the trade and sold in the market as roasted betel nuts. Therefore, assuming without admitting, even if the term is not defined in the statute, the product has to be understood and recognised in....
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....ied or included, - Nuts, ground-nuts and other seeds, whether or not mixed together, 2008 19 -- Other, including mixtures: 2008 19 20 --- Other roasted nuts and seeds. and Roasted Almond nuts imported from Australia are eligible to avail the benefit of SI. No. 622 of Notification No. 62/2022-Customs dated 26.12.2022. X. It is submitted that the preparation process being preheating, lining the baking sheet, and roasting - transforms the raw almonds into a form that fits the description of "otherwise prepared or preserved" nuts. This classification aligns with the heading 2008, which covers fruit, nuts, and other edible parts of plants that have been prepared or preserved, whether or not containing added sugar or sweetening matter or spirit, and are not specified elsewhere. Additionally, the classification under CTH 2008 19 20 is appropriate because other roasted nuts are specifically covered under this subheading. Y. It is submitted that Chapter 08 of the Custom Tariff also deals with the Edible fruit and nuts which are "fresh" or "dried" in general. It is submitted that the products subjected to import are "roasted" which are clearly not f....
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....reserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, - Nuts, ground-nuts and other seeds, whether or not mixed together, 2008 19 -- Other, including mixtures: 2008 19 20 --- Other roasted nuts and seeds. This subheading includes "Other roasted nuts and seeds," which includes the impugned roasted pista nuts. Roasted pista nuts imported from Vietnam, Thailand and Malaysia is eligible to avail the benefit of Sl. No. 172 of Notification No. 46/2011-Cus dated 01.06.2011. AE. It is submitted that the preparation process being preheating, lining the baking sheet, and roasting - transforms the raw pista into a form that fits the description of "otherwise prepared or preserved" nuts. This classification aligns with the heading 2008, which covers fruit, nuts, and other edible parts of plants that have been prepared or preserved, whether or not containing added sugar or sweetening matter or spirit, and are not specified elsewhere. Additionally, the classification under CTH 2008 19 20 is appropriate because other roasted nuts are specifically covered under this subheading. AF. It is submitte....
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.... when imported from Vietnam, Thailand and Malaysia. b) Roasted Areca Nuts is classifiable under CTH 2008 19 20 and eligibility of the List 5 of Notification No.26/2000-Cus dated 01.03.2000 when imported from Sri Lanka and eligibility of Sl. No. 172 of Notification No.46/2011-Cus dated 01.06.2011 for import of roasted Areca nuts when imported from Myanmar, Indonesia and Thailand. c) Roasted Almond nuts is classifiable under CTH 2008 19 20 and eligibility of the SI. No. 622 of Notification No. 62/2022-Customs dated 26.12.2022 for import of roasted almond nuts when imported from Australia. d) Roasted Pista nuts is classifiable under CTH 2008 19 20 and eligibility of the SI. No. 172 of Notification No. 46/2011-Cus dated 01.06.2011 for import of roasted pista nuts when imported from Vietnam, Thailand and Malaysia. 2. In terms of provisions of the Section 28-1 (1) of the Customs Act, 1962 read with Sub- Regulation no. (7) of the Regulation no. 8 of the Customs Authority for Advance Rulings Regulations, 2021, on the receipt of the said application, office of the CAAR, Mumbai forwarded copy of the said application/submissions to the concerned Jurisdictional Cu....
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....typically imported under CTH 0802, is already at or below the 7% threshold. Consequently, the importer's claim of achieving a moisture content reduction to less than 6% through repeated high-temperature roasting appears to be both illogical and potentially misrepresentative of the actual facts. 2.1.4 From a logical standpoint, if sun-dried areca nuts are not expected to contain more than 7% moisture, then subjecting these nuts to repeated roasting at severely high temperatures should result in moisture levels significantly lower than the claimed 6%. The importers have provided mere statements without producing any tangible evidence to substantiate their claims regarding the purported process. In the absence of such hard evidence, it appears more plausible that the proposed areca nuts are subjected only to moderate heat treatment, a process that is very much within the scope of CTH 0802. 2.1.5 Furthermore, the processes described by the importer seem to be primarily aimed at drying the nuts, rather than fundamentally altering their character. Consequently, the purported "Roasted Areca Nuts" are more accurately classifiable under Chapter 08, specifically under CTH 080280. I....
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.... clearly excluded from the scope of Chapter Heading 2008. 2.1.10 A holistic interpretation of the explanatory notes would suggest that Areca Nuts could be included in Chapter 20 only if they are presented in the packaged condition specified therein, i.e., in cans, jars, or airtight containers, after undergoing necessary processing and preparations. In the present case, the proposed import is in bulk form, which precludes it from being covered within the ambit of Chapter 20. . 2.1.11 Therefore, by applying the Specific vs General Entry Rule 3(a) of General Interpretation Rules, which states, "The heading which provides the most specific description shall be preferred to headings providing a more general description," it can be concluded that the impugned goods, i.c., roasted areca nuts, are more appropriately classifiable under Chapter 08. This is because Chapter Heading 080280 specifically covers areca nuts/betel nuts subjected to heat treatment, providing a more precise description of the goods in question. 2.1.12 It is important to note that while chapter headings are provided for ease of reference and do not have legal force in themselves, they do offer valuable guidanc....
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....opened for examination appeared to contain a mixed variety of areca nuts, with some visually appearing to be normal sun-dried areca nuts. This observation suggests a lack of uniformity in the processing of the nuts, which is inconsistent with the claimed high-temperature roasting process. 2.1.18 Furthermore, to ascertain the true nature of the goods, samples were drawn from the aforementioned consignments and subjected to rigorous testing by the Central Revenue Control Laboratory (CRCL), Chennai, and CRCL, New Delhi. The results of these tests are particularly illuminating. It was found that the goods were only moderately heat treated and not reasted as claimed by the importer. This scientific evidence directly contradicts the importers' assertions and provides strong support for the classification of these goods under Chapter 08. 2.1.19 The implications of these findings are far-reaching and raise serious concerns about the integrity of the import process. It appears that the above-mentioned importers, under the protection afforded by the CAAR Advance Rulings, attempted to import Areca nut by classifying it under CTI 2008 1920. This misclassification seems to be an attem....
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.... 2.1.25 The genuine "Roasted Areca Nuts" are consistently packaged in airtight packs or containers to maintain their quality and prevent moisture contamination, this packaging practice is not merely a matter of preference but a necessary consequence of the roasting process, which alters the nuts' susceptibility to environmental factors. 2.1.26 In this context, it is crucial to revisit the explanatory notes for heading 2008, which explicitly state: "The products of this heading are generally put up in cans, jars or airtight containers, or in casks, barrels or similar containers." The term "generally" in this context should be interpreted as "considering the whole of someone or something, and not just a particular part of him, her, or it". This interpretation underscores the importance of appropriate packaging as an integral characteristic of products classified under heading 2008. 2.1.27 To further corroborate this point, it is pertinent to observe that other roasted nuts, such as Roasted Pistachios, Roasted Cashews, and Roasted Almonds, are never stuffed in Gunny Bags. These premium nuts are invariably packed in airtight packages or containers, a practice that is both ....
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....however, will not be applicable for imports by 100% Export Oriented Units (EOUs) and units in the SEZ subject to the condition that no DTA sale is allowed. 08028090 -Areca Nuts --- Other Prohibited a) However, import is free if CIF value is Rs. 351/- or above per Kilogram. b) MIP conditions, however, will not be applicable for imports by 100% Export Oriented Units (EOUs) and units in the SEZ subject to the condition that no DTA sale is allowed. 21069030 --- Betel Nuts Product known as 'Supari Prohibited a) However, import is free if CIF value is Rs. 351/- or above per Kilogram. b) MIP conditions, however, will not be applicable for imports by 100% Export Oriented Units (FOUsy and units in the SEZ subject to the condition that no DTA sale is allowed. In this connection, it is apparent that the intention of the government is to regulate the import of "Areca Nut" in any form to safeguard the interests of the local farmers. In light of this regulatory framework, it appears that the appellant's application before the CAAR (Customs Authority for Advance Rulings) may be construed as an attempt to circumvent the aforementioned notification by seek....
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....priate classification for the subject goods is under CTSH 0802 80 and specifically under CTI 0802 8010 when imported as. Whole Nuts, under CTI.0802 8020 when imported as Split Nuts and under CTI 0802 8090 if imported under any other form. 2.3 Furthermore, this office has issued SCN to two Importers viz., M/s. Universal Impex and M/s. Neena Enterprises for mis-declaration of Moderately Heat-Treated Areca Nuts as "Roasted Areca Nuts". and for violation of MIP prescribed by DGFT Notification No. 57/2015-2020 dated 14.02.2023. As the impugned import goods are prohibited for import, the same were adjudicated and confiscated as per the directives issued by the Hon'ble High Court of Madras Order dated 12.07.2024 in W.A.Nos.1537, 1540, 1542, 1545, 1546, 1547, 1556 and 1564 of 2024. Further, the Hon'ble High Court of Madras vide Order dated 24.07.2024 have disposed the said Writ Appeals without extending any benefit in the favour of the Importers. 2.4 CLASSIFICATION OF ROASTED CASHEW NUT, ROASTED ALMOND NUT & ROASTED PISTA NUT: In view of the foregoing discussions made, general rules of interpretation and specific remarks made at para 5. xxvii above, classification of Roast....
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....e (Department of Revenue) No. 19/2000-Customs (N.T), dated the 1st March, 2000 that the goods in respect of which the benefit of this exemption is claimed are of the origin of Sri Lanka and in terms of the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020. 2.5.3 Similarly, preferential BCD under Notification No. 62/2022-Customs, shall be available only if importer proves to the satisfaction of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, that the goods in respect of which the benefit of this exemption is claimed are of the origin of Australia, in terms of the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020 and the Customs Tariff (Determination of Origin of Goods under the India-Australia Economic Cooperation and Trade Agreement) Rules, 2022 dated 22.12.2022. 3 Additional Submissions by the Applicant: 3.1 The applicant has submitted the response to the Department's comments as given below. 3.1.1 . Evidence of Manufacture Process not Mandatory Applicant submitted that the roasted Areca Nuts are specifically covered and classified under CTH 2008 19 20 of the C....
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.... taken a general stand that the goods to be imported by the applicant are generally imported in bulk quantities in jumbo bags and therefore are inconsistent with the Chapter Heading 2008. In this regard it is submitted that the packaging methods cannot be the basis for classification of the goods. 3.1.3 Observations of the Department are beyond the scope of the Advance Ruling sought (i) It is submitted that the Additional Commissioner in paragraph 5(xix) and (xx) of his letter dated 30.10.2024 has gone beyond the scope of the Advance Ruling sought by the applicant. The Additional Commissioner has arbitrarily made an observation that the classification proposed by the applicant is an attempt to misclassify the goods to circumvent several regulatory measures. It is submitted that such findings impose serious unwarranted allegations against the applicant and is, beyond the scope of the Advance Ruling sought by the applicant. These observations may kindly be, ignored for the purpose of the present proceedings. (ii) It is submitted that the Division Bench of the Hon'ble High Court of Madras in the case of Commissioner of Customs, Chennai-II vs. Shahnaz Commoditi....
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....910. (ii) As regards to Roasted Almond and roasted pistachio he contended that as per explanatory note to HSN chapter heading 2008 - the roasted Almond is specifically included as it includes: - Almond. groundnut, Areca nuts and other nuts. Pistachio as per the same analogy would fall under chapter heading 2008 and more specifically 20081920. (iii) He further submitted that the Roasted Areca nut/ betel nut merit classification under CTH 20081920 and that the CAAR, Mumbai has already decided a number of cases in which same classification is decided and in the case of M/s. Shahnaz & other, the ruling is uphold by Hon'ble Chennai High Court. He underlined that the same process is followed in this case. Nobody appeared from the department side for the Personal Hearing. 5. I have taken into consideration all the materials placed on record in respect of the subject goods. I have also gone through the response received from the Jurisdictional Customs Commissionerate. I therefore proceed to decide the present application regarding classification of "Roasted Cashew nuts, Roasted Areca nuts, Roasted Almond nuts and Roasted Pista nuts" on the basis of the ....
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....-1 of Customs Act, 1962 is produced below: "(2) The Authority may, after examining the application and the records called for, by order either allow or reject the application; Provided that the Authority shall not allow the application 59[ *** ] where the question raised in the application is,- (a) already pending in the applicant's case before any officer of customs, the Appellate Tribunal or any Court; (b) same as in a matter decided already by the Appellate Tribunal or any Court:" 5.5 I observe that this Authority as well as CAAR, Delhi have already issued multiple rulings in a sizeable number of applications intending import of the subject 'Roasted Areca Nuts' through various major/minor ports/Inland container Depots, spread across the country. The all such rulings are based on the same matter as upheld by the Hon'ble High Court of Madras in its order dated 01.08.2023. 5.6 In the instant case I further observe that the matter pertains to the classification of roasted areca nuts and that 'No new facts' have been put forth by the applicant before this authority to decide the classification. 5.7 In view of the fo....
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.... as under for ready reference: 2008 Fruit, Nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included - Nuts, ground-nuts and other seeds, whether or not mixed together: 2008 11 00 - Ground-nuts 2008 19 - Other, including mixtures: 2008 19 10 Cashew nut, roasted, salted or roasted and salted 2008 19 20 Other roasted nuts and seeds 2008 19 30 Other nuts, otherwise prepared or preserved 2008 19 40 Other roasted and fried vegetable products 2008 19 90 Other 2008 20 00 Pineapples 2008 30 Citrus fruit: 2008 30 10 Orange 2008 3.0 90 Other 9 It can be seen from the above Tariff arrangement that the goods i.e., cashew nuts, roasted, salted or roasted and salted has specific entry in the Customs Tariff as CTI 2008 1910. The case laws relied upon by the applicant regarding classification of roasted cashew nuts is also relevant to arrive at the correct classification of the same. 10. In the case of Commissioner of Central Excise v. Wockhardt Life Sciences Ltd. (2012 (277) E.L.T. 2....
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....n taken by the Hon'ble Supreme Court in the case of CC v. Business Forms Ltd., 2002 (142) E.L.T. 18 (S.C.) 12.4 Therefore, to further interpret the relevant Headings, Sub-Headings and Section Notes under the First Schedule of the Customs Tariff, reliance can also be placed on the Explanatory Notes to the HSN. 12.5 Heading 2008 covers 'FRUIT, NUTS AND OTHER EDIBLE PARTS OF PLANTS. OTHERWISE, PREPARED OR PRESERVED. WHETHER OR NOT CONTAINING ADDED SUGAR OR OTHER SWEETENING MATTER OR SPIRIT, NOT ELSEWHERE SPECIFIED OR INCLUDED'. It is quite obvious that the subject goods is question i.e. " is an edible parts of the plant". 12.6 Explanatory notes to heading explain that this heading covers fruit, nuts and other edible parts of plants, whether whole, in pieces or crushed, including mixtures thereof, prepared or preserved otherwise than by any of the processes specified in other Chapters or in the preceding headings of this Chapter. The explanatory notes further explain that this heading inter alia included: Almonds, ground- nuts, areca (or betel) nuts and other nuts, dry roasted, oil-roasted or fat-roasted, whether or not containing or coated with vegetable ....
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....rential BCD under Notification No. 46/2011-Cus, is subject to the importer proving to the satisfaction of the Deputy Commissioner of Customs or Assistant Commissioner of Customs. as the case may be, that the goods in respect of which the benefit of this exemption is claimed are of the origin of the countries as mentioned in Appendix I or Appendix II of the said Notification. in accordance with provisions of the Customs Tariff Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of Member States of the Association of Southeast Asian Nations (ASEAN) and the Republic of India] Rules, 2009. published in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 189/2009-Customs (N.T.), dated the 31st December 2009 and in terms of the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020. 13.2 Further, preferential BCD under Notification No. 26/2000-Cus dated'01.03.2000, is subject to the importer proving to the satisfaction of the Deputy Commissioner of Customs or the Assistant Commissioner of Customs, as the case may be, in accordance with the Customs Tariff (Determinati....