TaxTMI 
TaxTMI 
2024 (2) TMI 1648
X X X X Extracts X X X X
X X X X Extracts X X X X
..... 2. Applicant has stated as follows in their statement of relevant facts having a bearing on the question(s) raised enclosed with the CAAR-1 application: 2.1 That the applicant is an importer and trader in various excipients and other chemicals etc. In order to know the most appropriate and suitable HS code for "Sorbitol Special MDF 85", (mixtures of Sorbitol, Mannitol and 1, 4 Sorbitans and water)- Make SPI Pharma, USA, the applicant has decided to seek 'Advance Ruling" and has asked whether the correct CTI is: 38249900 - Mis Chemicals which states Mis. Chemical. OR 3824 6010 - Sorbitol other than that of sub-heading 2905 4400- in aqueous solution. The applicant has submitted a test/analysis report showing chemical composition of Sorbitol Sorbitan Solution NF Sorbitol Special MDF 85 issued by SPI Pharma in the name of the applicant M/s. Anshul Life Sciences which is reproduced below: 2.2 Further, the applicant has submitted a user guide of SPI Pharma which is reproduced as follows: Application Description Recommended Grades Advantage PEG, hydrophilic, hygroscopic fills Sorbitol Sorbitan Solution Sorbitol Special P....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er. Products of this kind are obtained by the hydrogenation of glucose syrups having a high disaccharide and polysaccharide content, without any separation process having taken place. They have the characteristic of being difficult to crystallise and are used in a wide variety of industries (e.g., food, cosmetics, pharmaceuticals, plastics, textiles). As such, it appears that the imported good are appropriately and rightly classifiable under CTH 38246010". Now as per the question of law or fact on which advance ruling has been sought of CAAR-1 to get the clarity of HS code for Sorbitol Special MDF 85 as per Customs Tariff Act. 1975, it is submitted that as per Customs Tariff Act, 1975 and explanatory notes "Sorbitol Special MDF 85" are classified under CTH 38246010 subject to explanatory notes wherein it should be sorbitol in particular, (D-glucitol) syrups containing other polyols and in which the D-glucitol content normally ranges from 60% to 80% of the dry matter. 4. A personal hearing in the matter was conducted on 21.12.2023 in office of the CAAR, Mumbai. During the personal hearing representatives of the applicant M/s. Anshul Life Sciences, Shri. Sushil Kumar Paha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tol Solution (70%) for reference relevant extracts of which is reproduced as under: Sorbitol Special MDF 85 is Sorbitol Sorbitan Solution which is partially hydrated Sorbitol solution. It is totally a different compound than Aqueous Sorbitol Solution which contains Sorbitol 70% in aqueous solution. Sorbitol Special MDF 85 contains nominally 34% of Sorbitol along with 1,4 Sorbitan at the nominal concentration of 28%. The manufacturing process is also different for both the products. Sorbitol Sorbitan Solution is manufactured by acid-catalyzed partial dehydration (anhydrization) of Sorbitol solution, whereas Sorbitol Solution is manufactured from starch by enzymatic hydrolysis and catalytic hydrogenation. Due to the presence of Sorbitan the properties and applications of Sorbitol Special MDF 85 completely differs from that of Sorbitol Solution. Sorbitol Special MDF 85 acts only as plasticizer in soft gel capsules, whereas Sorbitol solution acts as sweetener and as sugar substitute in Syrups. Sorbitol in Sorbitol Special MDF 85 is acting as a solubilizer for Sorbitan. -The different grades of Sorbitol Special serve as a humectant and plasticizer in the capsule shell ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....c acid catalyzed dehydration of sorbitol by and is an intermediate in the conversion of sorbitol to isosorbide. * The dehydration reaction usually produces sorbitan as a mixture of five- and six-membered cyclic ethers with the five-membered 1,4-anhydrosorbitol form being the dominant product. * Sorbitan is produced selectively, if reaction conditions are carefully controlled. * It is also available as white powder after recrystallisation from Solution. * In Sorbitol Special, Sorbitan is not crystallized as it being used as a plasticizer it has to be dissolved again in any solvent * The percentage of Sorbitol is 25.0-40.0 and Sorbitan is 26-30% Sorbitol as a Soft-gel Plasticiser * Advantages: * Plasticizes mainly through indirect interactions through its hygroscopicity and also weakly through intermolecular interactions between the hydroxyl groups and the hydrophilic groups on gelatine or non-gelatine materials. * Less hygroscopic, hydrophilic, and lower mobility than glycerine. * Provides lower humidity susceptibility and gas permeability than glycerine. * Disadvantages: * No....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... secondary C4". In manufacturing soft gelatine capsules, SPI pharma's grades of specialty plasticizers serve as a humectant and plasticizer for the capsule shell. They function to keep the shell soft and pliable, making it stable and easy to handle. These qualities result in a smooth, shiny, premium-finished appearance that is desirable to consumers. Sorbitol Special plasticizers are not soluble in PEG. They will not leach into the PEG-based fills of the capsule unlike standard plasticizers such as glycerine that are soluble in PEG. Using Sorbitol Special can result in a more stable shell, reducing failures from leaking capsules and increasing quality and output. Sorbitol Special can also inhibit blooming-white discoloration on the surface of the capsule. Left alone, PEG can react with gelatine plasticizers, allowing moisture to migrate away from the shell, causing the capsule to break down. Sorbitol Special plasticizers can help keep moisture well -adjusted to help prevent this failure. 6. I have taken into consideration all the materials placed on record in respect of the subject goods including the submissions made by the applicant during the course of personal hearing....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d applications of Sorbitol Special MDF 85 completely differs from that of Sorbitol Solution and Sorbitol Special MDF 85 acts only as plasticizer in soft gel capsules, whereas Sorbitol solution acts as sweetener and as sugar substitute in Syrups is not completely grounded in facts, as the applicant itself has mentioned that both Sorbitol and 1,4-Sorbitan are plasticizers, although, one is direct plasticizer and another is indirect plasticizer. I have perused the additional literature and presentation with details of Sorbitol Sorbitan Solution and Sorbitol Solution submitted by the applicant wherein some graphs are displayed showing comparison among efficiency of three plasticizer systems i.e. SPI Pharma's Sorbitol Special, Sorbitol Special MDF 85 and a competitive system (Competitor P) in terms of hardness and drying time and it is amply clear that both sorbitol and Sorbitol Special MDF 85 are plasticizers, although, it is pertinent to mention that Sorbitol solution also acts as sweetener and as sugar substitute in Syrups, but, it does not disqualify Sorbitol from being a plasticizer. This contention of the applicant that Sorbitol in Sorbitol Special MDF 85 is acting as a sol....
X X X X Extracts X X X X
X X X X Extracts X X X X
....annitol, another sugar alcohol; the two differ only in the orientation of the hydroxyl group on carbon 2. While similar, the two sugar alcohols have very different sources in nature, melting points, and uses. As an over-the-counter drug, sorbitol is used as a laxative to treat constipation. 7. In view of the above findings, now let me delve into the Heading 2905 and 3824 to pass the advance ruling on the question of classification of Sorbitol Special MDF 85 for imports. The classification of the goods under the Customs Tariff is governed by the principles as enumerated in the General Rules of Interpretation ('GRI') set out in the First Schedule to the Customs Tariff Act, 1975 ('Tariff'). As per Rule 1 of the GRI, classification of the imported products shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require, according to the remaining Rules of the GRI. GRI 1 stipulates that the goods under consideration should be classified in accordance with the terms of the Headings and any relevant Section or Chapter Notes. These Section or Chapter Notes and Sub-Notes ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ding 3824 is reproduced as under: 38.24 - Prepared binders for foundry moulds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included (+). 3824.10 - Prepared binders for foundry moulds or cores 3824.30 - Non-agglomerated metal carbides mixed together or with metallic binders 3824.40 - Prepared additives for cements, mortars or concretes 3824.50 - Non-refractory mortars and concretes 3824.60 - Sorbitol other than that of subheading 2905.44 .... .... .... .... .... 3824.92 -- Polyglycol esters of methyl-phosphonic acid 3824.99 -- Other Relevant extracts of the Explanatory notes of heading 3824 are reproduced as under: Subject to the above conditions, the preparations and chemical products falling here include : (1) Naphthenic acids (by-products of the refining of certain petroleum oils and of certain oils obtained from bituminous minerals), and their salts, other than the water-soluble naphthenates of heading 34.02, and salts ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of Explanatory Note of 3824 is that heading 3824 covers the Sorbitol which have the characteristic of being difficult to crystallise and are used in a wide variety of industries (e.g. food, cosmetics, pharmaceuticals, plastics, textiles). Applicant has submitted that Sorbitan prevents crystallisation of sorbitol and Sorbitol Special MDF 85 will be used soft gel - plasticizer which enhance the capsule finish gloss for a premium appearance, help to prevent leakage, provides consistent pharmaceutical quality, and extend shelf life by maintaining a proper moisture balance within the capsule shell. Hence, by virtue of this submission of the applicant this condition of Explanatory Note that Sorbitol of heading 3824 are used in a wide variety of industries (e.g. food, cosmetics, pharmaceuticals, plastics, textiles) is satisfied as the product in question i.e. Sorbitol Special MDF 85 is used in pharmaceutical industries. 8. In the case of Commissioner of Central Excise Versus Wockhardt Life Sciences Ltd. {2012 (277) E.L.T. 299 (S.C.)}, it was held that "Classification of goods - Determination of - it cannot be under residuary entry in presence of specific entry, even if it requires prod....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... So, by this analysis Sorbitol Special MDF 85 cannot be classified under CTI 3824 6090. 10. On the basis of foregoing discussions and findings, I reach to the conclusion that "Sorbitol Special MDF 85", (mixtures of Sorbitol, Mannitol and 1, 4 Sorbitans and water) merits classification under Custom Tariff Heading 3824, specifically under CTI 3824 6010 "sorbitol other than that of sub-heading 2905 44: In aqueous solution" of Chapter 38 of the First Schedule of the Customs Tariff Act, 1975, and I rule accordingly. ============= Document 1 Document Number: SPI-SPEC-172, Rev 07 SPI Pharma SPI Pharma Inc 1711 Tiles Court Grand Haven, MI 49417 USA PH: 616-935-6900 An ABF Ingredients Company Sorbitol Sorbitan Solution NF Sorbitol Special â„¢ MDF 85 Retest Date: 3 year(s) from the date of Mfg. Product Code : 111-1124 CHARACTERISTICS (1) Identification Test A A deep pink or red wine color appears Identification Test B Current NF (1) Identification Test C - EG NMT 0.10 % (1) Identification Test C - DEG NMT 0.10 % CHEMICAL 1,4 Sorbitan, % (db) 26.0 - 30.0 % Mannitol, % (db) Information Only Sorbitol, % (db) 25.0 - 40.0 % (1) Residual Solven....