TaxTMI 
TaxTMI 
2026 (4) TMI 708
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....mand/ fine/ penalty/ interest as may be leviable on such goods, subsequently in adjudication. (ii). The importer is required to furnish Bank Guarantee/ Security (containing clause binding the issuing Bank to keep it renewed and valid till payment of full liability in this case, or in the event of non-renewal of bank guarantee, the guaranteed amount be credited to Govt. account by the bank on its own) of Rs. 1,63,64,732/- (Rupees one crore sixty three lakh sixty four thousand seven hundred thirty two only) as security covering payment of any possible future liabilities of Duties)/penalties/ fines payable against the said goods. 2. Briefly stated facts of the present case are that the Appellant filed a Bill of Entry No. 8008083 dated 25.01.2025 and declared the description of the subject goods as "Areca Nuts" classified under CTH 08028090. The Appellant imported the said goods from Thanulak Trading Pvt Ltd, 342/2/C, Gonawala Road, Kelaniya, Sri Lanka. The details of goods are as follows: S. No. BoE No. & Date Declared description of the goods Quantity (in Kgs) Declared Assessable Value (in Rs.) Duty involved (in Rs.) 1. 8008083 25.01.2025 Areca ....
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....eyed their disagreement with the conclusion of the CRCL report, which suggested the samples are "roasted areca nut" and "unfit for human consumption". The Importer/Appellant further requested for sending the samples to any other FSSAI notified laboratories/referral lab. The request of the Importer/Appellant was considered and as per the directions of the competent authority, fresh samples were drawn and were sent to CRCL, New Delhi vide test memo no. 1303585 dated 06.10.2025 to ascertain the nature of the samples whether roasted, dried or raw and also to National Food Laboratory, Ghaziabad vide test memo no. CUS/28/25-26 dated 06.10.2025 to ascertain whether the samples are fit for human consumption or not. 2.3.1 In respect of test memo no. 1303585 dated 06.10.2025, the CRCL, New Delhi vide its report dated 06.11.2025 reported as under: "The tested parameter of the sample u/r does not meet the requirement for Areca Nut/Betel Nut as per Food Safety and Standards Regulation (FSSR 2011). On the basis of physical appearance, color and other tested parameter the sample u/r is roasted areca nut." 2.3.2 On the other hand, the National Food Laboratory, Ghaziabad vid....
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....rovisional assessment of goods, give discretion to the Department to impose condition for seeking provisional release of the seized goods. He also submits that though discretion has been given to the adjudicating authority but the said discretion has to be exercised in a reasonable manner and the adjudicating authority cannot impose the arbitrary, unreasonable and onerous conditions under the Act in every case of seizure. He also submits that the purpose of imposing conditions on provisional release of goods is to secure the interest of revenue but it cannot be at the cost of advantage to the Customs Department. He further submits that the Department, by way of imposing such harsh conditions, has made Section 110A of the Customs Act ineffective. 4.2 He further submits that the Circular dated 16.08.2017 was issued by the Board by relying upon the judgment of Hon'ble Delhi High Court in WP(C) No. 3965/2017 titled as Mala Petrochemical & Polymers vs. Addl. Director General, DRI & Another & WP(C) No. 4123/2017 titled as Mala Petrochemical & Polymers vs. The Commissioner of Customs (Import), ICD, Tughlakabad, New Delhi as mentioned in the circular itself. He further submits that the ....
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...., drying and addition of some ingredients, heat treatment are meant for additional preservation or stabilization or to improve/maintain the appearance of the product; process of roasting is not done for additional preservation or stabilization or to maintain, improve the appearance; roasting process is done for immediate consumption of areca nut and it also changes the appearance and chemical composition of the product; therefore, a new product emerges after roasting process and clearly falls outside Chapter Note 3 of Chapter 8. 4.7 He further submits that it is nowhere stated in the CRCL's test report that any such roasting process has undergone on areca nut, and thus, in the absence of this finding, it is wrong to assume the goods as "Roasted Areca Nuts". 4.8 He also submits that as per HSN Explanatory Notes, heading 2008 covers fruits/nuts/edible parts of plants, whole/piece/crushed, prepared or preserved otherwise than by any process specified in other chapters or in the preceding headings of this chapter, and in the absence of any proof of processes carried out in the present case, the goods in question would fall under Chapter Heading 0802. 4.9 He further submits tha....
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....atisfied with the said report of CRCL, New Delhi, requested the Department for re-testing from any other FSSAI approved laboratories/referral lab. Subsequently, on the Appellant's request, one part of the samples was sent to CRCL, New Delhi again to ascertain the nature of the goods and another part of the samples was sent to National Food Laboratory, Ghaziabad to ascertain whether the samples are fit for human consumption or not. Further, we find that the CRCL, New Delhi vide its test report dated 06.11.2025 again declared the samples as 'Roasted Areca Nuts' on the basis of physical appearance, whereas National Food Laboratory, Ghaziabad vide its test report dated 13.10.2025 declared that the samples are 'fit for human consumption'. 8. Further, we find that the report of CRCL, New Delhi cannot be relied upon in the present case because the Chemical Examiner, who analyzed the samples, is not a food analyst and he has not conducted the test as per the procedure prescribed under Food Safety & Standards (Food Products Standards and Food Additives) Regulations, 2011, and has declared the classification of the goods only on the basis of visual inspection, which is not permissible in ....
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....ick is applied to the entire consignment. If such tests are applied to the several range of agricultural products domestically available from the indigenous sources, it would be impossible for any agricultural produce to have a market. Illustratively, 10 grains from a sample of 1000 grains cannot be determinative of the standard of the majority of the grains. The FSSAI reports cannot be disregarded, which was made available immediately after the samples of the imported goods were drawn for testing." The Hon'ble Bombay High Court has also considered the procedure prescribed in Food Import Manual issued by FSSAI to be followed in conducting the laboratory test on roasted areca nuts and has observed as under: "18. Further, the Food Import Manual issued by FSSAI clearly specifies the steps to be taken insofar as laboratory analysis is concerned. It is only after this laboratory analysis is made, that a NOC is issued by the FSSAI and then on the basis thereof, the goods can be released. * * * * * * It is seen from the above procedure that insofar as laboratory analysis is concerned, the analysis and test reports are made by FSSAI within five days from the date of re....