TaxTMI 
TaxTMI 
2026 (8) TMI 1006
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....a bearing on the question on which advance ruling is required 2.1.1 The applicant deals with in-license clinically backed, patented ingredients from around the world and serve the Indian pharmaceutical, nutraceutical, OTC and D2C sectors. The applicant has been importing the product namely "Keranat" from Roberted SA, France under Customs Tariif Item (CTI) 1302 19 19 from Air Cargo Complex, Mumbai & IGI Air Cargo, Delhi. 2.1.2 Keranat is imported in a yellowish oil form in 25 kg, 5 kg and 1 kg bottles packed in bulk cartons and is used as an ingredient to manufacture tablets to support hair growth and prevent hair loss. The Applicant does not process, repack or label the product imported into the country and sells the same in as is form to third parties where it is further processed in the form of tablets with added supplements such as vitamins, zinc etc., before being sold to end consumers through other marketing companies. 2.1.3 Keranat is a vegetable extract derived from millet and wheat, dissolved or carried in sunflower oil, and not subjected to further purification or additional extraction cycles. 2.1.4 The Applicant is the sole and exclusive importer of Keranat in....
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.... product in question be classified under CTHs 3301 (Essential Oils), 3305 (preparation for use on the hair) or 3307 (perfumery, cosmetic or toilet preparation)" Question No. 6: "Should the product in question be classified under CTH 3824 as (chemical products and preparation of the chemical or allied industries (including those consisting of mixtures of natural products)." Question No. 7: If the product mentioned above is not classifiable under the CTHs / CTIs as mentioned above, then what would be the correct classification of the above product under the Tariff? 2.4 Whether Keranat which is in the nature of a Compound vegetable extract classifiable under CTH 1302 2.4.1 The composition of Keranat is as follows: Sr. No. Ingredient Composition (%) 1. Millet seed extract 60 2. Sunflower seed oil 29.93 3. Wheat seed extract 10 4. Rosemary extract 0.07 2.4.2 Keranat is manufactured by crushing millet seeds into millet flour and its standardization by adding cold pressed sunflower seed oil. Thereafter, wheat extract is extracted from wheat seed with ethanol and filtration and thereafter ethanol is removed by way of v....
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....which covers 'vegetable saps and extracts; pectic substances, pectinates and pectates; agar-agar and other mucilages and thickeners, whether or not modified, derived from vegetable products', and specifically under tariff item 1302 19 39, i.e. the residual entry for 'Other' extracts under Heading 1302. The said entry appropriately covers vegetable extracts which are not specifically enumerated under tariff items 1302 19 11 to 1302 19 38. It is respectfully submitted that the HSN Explanatory Notes to Heading 1302 specifically recognise that vegetable extracts may be simple or compound extracts, and may contain added inert substances or carrier media for standardisation or stability purposes, without losing their classification as vegetable extracts. In the present case, sunflower oil merely acts as a carrier / standardising medium and does not alter the fundamental character of the product as a vegetable extract. Further, the product remains identifiable in trade and commerce as a plant / vegetable extract preparation and not as sunflower oil or a preparation of vegetable oils. 2.4.5 Chapter 13 falls under Section II of the Import Tariff titled 'lac; gums, ....
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....an 1302 39 90 --- Other 2.4.6 Further, note to Chapter 13 states that: "Heading 1302 applies, inter alia, to liquorice extract and extract of pyrethrum, extract of hops, extract of aloes and opium. The heading does not apply to: (a) liquorice extract containing more than 10% by weight of sucrose or put up as confectionery (heading 1704); (b) malt extract (heading 1901); (c) extracts of coffee, tea or mate (heading 2101); (d) vegetable saps or extracts constituting alcoholic beverages (Chapter 22); (e) camphor, glycyrrhizin or other products of heading 2914 or 2938; (f) concentrates of poppy straw containing not less than 50% by weight of alkaloids (heading 2939); (g) medicaments of heading 3003 or 3004 or blood-grouping reagents (heading 3822); (h) tanning or dyeing extracts (heading 3201 or 3203); (i) essential oils, concretes, absolutes, resinoids, extracted oleoresins, aqueous distillates or aqueous solutions of essential oils or preparations based on odoriferous substances of a kind used for the manufacture of beverages (Chapter 33); or (j) natural rubber, bal....
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.... thickeners, whether or not modified, derived from vegetable products : 2.4.9 The composition breakdown of Keranat is as follows: Ingredients Role Standardized millet seed extract 89.8% Millet seed extract - 60% Active ingredient Sunflower seed oil - 29.80% Excipient Wheat Extract - 10% Wheat extract - 10% Active ingredient Rosemary extract - 0.2% Rosemary extract - 0.07% Antioxidant Sunflower seed oil -0.13% Excipient 2.4.10 Millets are a highly varied group of small-seeded grasses, widely grown around the world as cereal crops or grains for fodder and human food. Most millets belong to the tribe Paniceae. (https://en.wikipedia.org/wiki/Millet). Further, Wheat is a group of wild and domesticated grasses of the genus Triticum. They are cultivated for their cereal grains, which are staple foods around the world (https://en.wikipedia.org/wiki/Wheat). Millet seed extract and Wheat extract form the active ingredients of Keranat along with excipient (sunflower seed oil) and antioxidant (rosemary extract). The rosemary extract acts as an antioxidant in the composition of Keranat and does not change the essential characteristics of the pr....
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.... 19. Since Keranat is admittedly an extract and is not specifically covered under tariff items 1302 19 11 to 1302 19 38, the appropriate residual entry within the extract category would necessarily be tariff item 1302 19 39. Resort to the broader residual entry 1302 19 90 would arise only where the product is not classifiable within the specific extract branch itself. 2.4.13 The description of goods under entries 13021911 to 13021938 does not match Keranat. as it is a composite extract made by combining two distinct plant extracts, namely millet and wheat. The entries under tariff items 1302 19 50 and 1302 19 60 specifically relate to Cashew Shell Liquid ("CNSL") and purified/distilled Cardanol respectively and therefore are clearly distinguishable from the subject goods, which are vegetable extracts derived from millet and wheat. Further, Keranat is not specifically covered by any of the named extract entries under tariff 'items 1302 19 11 to 1302 19 38 and is therefore appropriately classifiable under the residual extract entry. Further, the subject goods are not marketed, traded or understood in the industry as edible oils, nutritional food preparations, medicaments, essen....
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....matter). The saps and extracts classified here include: (1) Opium, the dried sap of the unripe capsules of the poppy (Papaver somniferum) obtained by incision of, or by extraction from, the stems or seed pods. It is generally in the form of balls or cakes of varying size and shape. However, concentrates of poppy straw containing not less than 50% by weight of alkaloids are excluded from this heading (see Note 1(f) to this Chapter), (2) Liquorice extracted from the dried roots of a plant of the Leguminosas family (Glycyrrhizalabra) by hot water under pressure and then concentrated. It may be in liquid form or in locks, cakes, sticks, slices or powder. (Liquorice containing more than 10% by weight of sucrose, or put up (i.e., prepared) as confectionery whatever the sugar content, is excluded, see heading 17.04.) (3) Extract of hops. (4) Pyrethrum extract, obtained mainly from the flowers of various pyrethrum varieties (e.g., Chrysanthemum cinerariaefolium) by extraction with an organic solvent such as normal hexane or "petroleum ether". (5) Extracts of the roots of plants containing rotenone (derris, cube, limbo, barbasco, etc.). ....
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....w nutshell extract. The polymers of cashew nutshell liquid extract are, however, excluded (generally heading 39.11). (21) Vanilla oleoresin (sometimes erroneously known as "vanilla resinoid" or "vanilla extract"). 2.4.17 Since the active ingredients, i.e. millet and wheat extract are both extracted from their seeds, they are vegetable extracts. The fact that extracts of nuts and seeds also are considered as 'vegetable saps and extracts' (see Sr. Nos. 19 and 20 above) further reinforces the view that Keranat, a mixture of millet and wheat extract, would fall under CTH 1302. However, the said product does not fall into the above category of vegetable saps and extracts covered from Sr. Nos. 1 to 21 above. 2.4.18 The abovementioned explanatory note further states that: "Saps are usually thickened or solidified. Extracts may be in liquid, paste or solid form. "Tinctures' are extracts still dissolved in the alcohol by means of which they are extracted; the so-called 'fluid extracts' are solutions of extracts in, for example, alcohol, glycerol or mineral oil. Tinctures and fluid extracts are generally standardised (for instance, pyrethrum extrac....
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....on, or additional extraction cycles (e.g. liquid-liquid extraction) following initial extraction." [Emphasis Added] 2.4.21 Keranat is a compound extract derived from millet and wheat, dissolved or carried in sunflower oil, and not subjected to further purification or additional extraction cycles. The formulation is consistent with the definition of fluid or compound extracts. The use of sunflower oil is as an inert carrier and not as an active ingredient. 2.4.22 Keranat is a vegetable extract in oil form sold to third party manufacturers where it is further processed in form of tablets with added supplements before it is sold to end consumers through other marketing companies. Keranat as an ingredient of these final product helps in preventing hair loss and promotes hair growth. Such downstream use is irrelevant for classification purposes, which must be determined based on the condition of the goods at the time of import. The addition of sunflower seed oil does not give Keranat a character of food preparations or medicines. Keranat also does not undergo the refining or purifying process as mentioned above. And finally, Keranat is used as a raw material for manufacture of ....
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....ing agents, foaming agents, fruit juices, etc., and sometimes with essential oils. The preparations thus obtained are generally classified in heading 21.06 or 33.02. (iii) Medicinal preparations (some of which are also known as "tinctures") consisting of mixtures of vegetable extracts with other products (e.g., preparations which consist of a mixture of extract of capsicum, spirits of turpentine, camphor and methyl salicylate, or of a mixture of tincture of opium, anise oil, camphor and benzoic acid) (heading 30.03 or 30.04). (iv) Intermediate products for the manufacture of insecticides, consisting of pyrethrum extracts diluted by addition of mineral oil in such quantities that the pyrethrins content is less than 2%, or with other substances such as synergists (e.g., piperonyl butoxide) added (heading 38.08). The heading also excludes vegetable extracts which have been mixed or compounded (without the addition of other substances) for therapeutic or prophylactic purposes. Such mixtures, and similar medicinal compound extracts made by treating a mixture of plants, are classified in heading 30.03 or 30.04. That latter heading also covers simple vegetable e....
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....ine algae found mainly in the Indian and Pacific Oceans, and usually presented in the form of dried fibres, flakes, powder or in a gelatinous form obtained by treatment with acids. It is commercially known as "gelose" and also as Japanese vegetable gelatin (or moss) or Alga spinosa. (2) Endosperm flour of locust beans (Ceratonia siliqua) or guar seeds (Cyamopsis psoraloides or Cyamopsis tetragonoloba). These flours are included in this heading, whether or not modified by chemical treatment in order to improve or stabilise their mucilaginous properties (viscosity, solubility, etc.). (3) Carrageenan extracted from carrageen (known also as Irish moss or pearl moss) and usually in the form of fibrous threads, flakes or powder. The heading also includes mucilaginous substances obtained from carrageenan by chemical transformation (e.g., "sodium carrageenate"). (4) Thickeners obtained from gums or gum-resins rendered water-soluble by treatment with water under pressure or by any other process. (5) Cotyledon flour of tamarind seeds (Tamarindus indica). These flours are included in this heading even if modified by heat or chemical treatment. The ....
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....(oil) state. Chemically, both fats and oils are composed of triglycerides. Although many animal parts and secretions may yield oil, in commercial practice, oil is extracted primarily from rendered tissue fats from livestock animals like pigs, chickens and cows. Dairy products yield animal fat and oil products such as butter (https://en.wikipedia.org/wiki/Animal_fat). Cleavage product in this context means a substance resulting from the splitting of a molecule into two or more simpler molecules (Cleavage product definition of cleavage product by Medical dictionary). 2.6.4 Going by the composition of Keranat, it does not qualify to be animal or microbial fat or oil or their cleavage product. To determine whether it qualifies to be vegetable oil/fat or its cleavage product, a perusal of WCO explanatory notes to Chapter 15 can be perused. 2.6.5 The WCO Explanatory Notes to Chapter 15 states as under: "With the exception of sperm oil and jojoba oil, animal, vegetable or microbial fats and oils are esters of glycerol with fatty acids (such as palmitic, stearic and oleic acids). They may be either solid or fluid, but are all lighter than water. On fairly long exposure to ai....
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....room temperature, predominate in solid oils, fluid oils are mainly composed of glycerides which are liquid at room temperature (glycerides of oleic acid, linoleic acid, linolenic acid, etc.). Microbial fats and oils are also mixtures of glycerides mainly of polyunsaturated fatty acids such as arachidonic acid and linoleic acid, which are liquid at room temperature. These headings cover crude fats and oils and their fractions, as well as those which have been refined or purified, e.g., by clarifying, washing, filtering, decolourising, deacidifying or deodorising. The vegetable fats and oils covered by these headings are mainly obtained from the oil seeds and oleaginous fruits of the headings 12.01 to 12.07, but may also be obtained from vegetable materials classified elsewhere (e.g. .: olive oil, oils obtained from the kernels of peaches, apricots or plums of heading 12.12, oils obtained from almonds, walnuts, pignolia nuts, pistachio nuts, etc., of heading 08.02, oil obtained from germ of cereals). 2.6.6 Thus, vegetable oil/fat classifiable under Chapter 15 are typically esters of glycerol with fatty acids (such as palmitic, stearic and oleic acids), should be used as foodstu....
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....r it useful in the paint or varnish industries. The product Keranat does not qualify to be used as salad oil or other preparations mentioned above. Also, sunflower seed oil present in Keranat is used as an excipient to standardize the mixture of Keranat. Therefore, it can be said that Keranat does not qualify to be classified under CTH 1512. 2.6.9 CTH 1515 covers the following goods: 1515 OTHER FIXED VEGETABLE OR MICROBIAL FATS AND OILS (INCLUDING JOJOBA OIL) AND THEIR FRACTIONS, WHETHER OR NOT REFINED, BUT NOT CHEMICALLY MODIFIED - Linseed oil and its fractions : 1515 11 00 -- Crude oil 1515 19 -- Other : 1515 19 10 --- Edible grade 1515 19 90 --- Other - Maize (Corn) oil and its fractions: 1515 21 00 -- Crude oil 1515 29 -- Other : 1515 29 10 --- Edible grade 1515 29 90 --- Other 1515 30 - Castor oil and its fractions: 1515 30 10 --- Edible grade 1515 30 90 --- Other 1515 50 - Seasame oil and its fractions: 1515 50 10 --- Crude oil --- Other : 1515 50 91 ---- Edible grade 151....
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....se ingredient. Therefore, it cannot be classified under Chapter 15 or its headings. 2.7 Whether Keranat is in the nature of a miscellaneous edible preparation and hence classifiable under CTH 2106. 2.7.1 Chapter 21 covers 'miscellaneous edible preparations' and CTH 2106 deals with food preparations, not elsewhere specified or included'. Note 5 to Chapter 21 states that: "5. Heading 2106 (except 2106 90 20 & 2106 90 30), inter alia, includes: (a) Protein concentrates and textured protein substances; (b) Preparations for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk or other liquids), for human consumption; (c) Preparations consisting wholly or partly of foodstuffs, used in the making of beverages or food preparations for human consumption; (d) Powders for table creams, jellies, ice-creams and similar preparations, whether or not sweetened; (e) Flavouring powders for making beverages, whether or not sweetened; (f) Preparations consisting of tea or coffee and milk powder, sugar and any other added ingredients; (g) Preparations (for example, tablet....
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.... Preparations for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk, etc.), for human consumption. (B) Preparations consisting wholly or partly of foodstuffs, used in the making of beverages or food preparations for human consumption. The heading includes preparations consisting of mixtures of chemicals (organic acids, calcium salts, etc.) with foodstuffs (flour, sugar, milk powder, etc.), for incorporation in food preparations either as ingredients or to improve some of their characteristics (appearance, keeping qualities, etc.) (see the General Explanatory Note to Chapter 38). However, the heading does not cover enzymatic preparations containing foodstuffs (e.g., mcat tenderisers consisting of a proteolytic enzyme with added dextrose or other foodstuffs). Such preparations fall in heading 35.07 provided that they are not covered by a more specific heading in the Nomenclature." 2.7.6 It could therefore be discerned that goods would be classifiable under CTH 2106 only if they are not covered by any other heading under the Customs Tariff. Further, Keranat also does not appear to fall under the category of preparation....
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....uretic or carminative properties). including products which are claimed to offer relief from ailments or contribute to general health and well-being. The heading excludes products where an infusion constitutes a therapeutic or prophylactic dose of an active ingredient specific to a particular ailment (heading 30.03 or 30.04). The heading also excludes such products classifiable in heading 08.13 or Chapter 9. (15) Mixtures of plants, parts of plants, seeds or fruit (whole, cut, crushed, ground or powdered) of species falling in different Chapters (e.g., Chapters 7, 9, 11, 12) or of different species falling in heading 12.11, not consumed as such, but of a kind used either directly for flavouring beverages or for preparing extracts for the manufacture of beverages. However, products of this type whose essential character is given by their content of species falling within Chapter 9 are excluded (Chapter 9). (16) Preparations, often referred to as food supplements or dietary supplements, consisting of, or based on, one or more vitamins, minerals, amino acids, concentrates, extracts, isolates or the like of substances found within foods, or ....
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....hence will not fall under the same heading. 2.8 Whether Keranat is in the nature of pharmaceutical products and hence classifiable under CTHs 3003 or 3004. 2.8.1 CTHs 3003 and 3004 fall under Chapter 30 which covers 'pharmaceutical products'. CTHs 3003 and 3004 cover the following goods: Chapter Heading Description of goods 3003 Medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of two or more constituents which have been mixed together for therapeutic or prophylactic uses, not put up in measured doses or in forms or packings for retail sale 3004 Medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses (including those in the form of transdermal administration systems) or in forms or packings for retail sale 2.8.2 Thus, goods falling under CTHs 3003 should primarily satisfy the following conditions: (i) Medicaments; (ii) Mixed or unmixed products; and (iii) For therapeutic or prophylactic uses. The term 'medicament' as defined in the Oxford Dictionary is "a drug or another form of medic....
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....dicine defines it as, "Any permanent or semi- permanent disturbance of structure or function of any part body caused by an external agency. Such agency may be mechanical, thermal, chemical, electrical or radiational. The term may also be applied to damage caused by infecting organisms or to psychological trauma". Again, in medical terms, 'illness' or 'ailment' is often defined as "a physical or mental disorder" [American Heritage Medical Dictionary], or "A complaint disease or physical disorder" [Farlex Partner Medical Dictionary]. 2.8.7 In the case of Commissioner of Central Excise vs. M/s. Ciens Laboratories 2013 (8) TMI 467, it was inter alia held by the Hon'ble Supreme Court that even if a product constitutes pharmaceutical ingredients having therapeutic or prophylactic properties, it will not be construed as a 'medicament' covered under CTH 3003, if it is not used primarily for curing or treating ailments or diseases. Relevant extract of the judgment is reproduced below for case of reference: "Firstly, when a product contains pharmaceutical ingredients that have therapeutic or prophylactic or curative properties, the proportion of such i....
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....d technical meaning of the terms and expression should not be automatically adopted but preference should be given to the popular meaning that is to say, the meaning attached to them by those using the product. As such, the certificates issued by Drug Control Authorities cannot be the basis to decide the classification of these products. In any case there is no certificate issued by the Drug Control authorities for the said imported product. 2.8.10 The Supreme Court, in the case of Commissioner of Central Excise & Customs, Surat-II vs. Nirmala Dychem 2007 (207) E.L.T. 161 (SC), held that the principal use of the product needs to be seen to decide classification of said goods. 2.8.11 The CESTAT in the case of Hindustan Pulverising Mills vs. Commissioner of Customs (Imports), Raigad-11/ 2019 (365) E.L.T. 321 (Tri. - Bom), held that: "4.6 Heading 1302 covers, by and large, extracts in purer form which are used as a raw material for preparation of end products down the line in products meant for human consumption either as a drug or medicine or in food preparations. Further the end products prepared from the raw material of these headings are not classified here rather t....
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....which serve as raw materials in the perfumery, food and other industries, are of vegetable origin. They are generally of complex composition and contain alcohols, aldehydes, ketones, phenols, esters, ethers and terpenes in varying proportions. These oils remain in the heading whether or not their fragrance has been modified by removal of their terpenes. 2.9.4 While rosemary extract is covered under the list of essential oils under the explanatory notes, it is important to note that the rosemary extract used in the composition of Keranat merely acts as an antioxidant which is necessary for the requisite performance of the product to prevent oxidizing the composition of the various vegetable/plant extracts. It does not serve as a raw material or primary ingredient in the Keranat to be used in perfumery or food industry. Therefore, Keranat does not merit classification under CTH 3301. 2.9.5 Further, CTH 3305 covers 'preparations for use on the hair'. It includes various types of hair oils, conditioners, and treatments. The phrase preparation for use on the hair typically would refer to any substance or mixture that is specifically formulated and intended to be applied to....
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.... under: "This heading covers: (1) Shampoos, containing soap or other organic surface-active agents (see Note 1 (c) to Chapter 34), and other shampoos. All these shampoos may contain subsidiary pharmaceutical or disinfectant constituents, even if they have therapeutic or prophylactic properties (see Note I (e) to Chapter 30). (2) Preparations for permanent waving or straightening. (3) Hair lacquers (sometimes known as "hair sprays"). (4) Other hair preparations, such as brilliantines, hair oils, creams ("pomades") and dressings; hair dyes and bleaches used on the hair; cream-rinses. Preparations applied to hair on parts of the human body other than the scalp are excluded (heading 33.07)." 2.9.10 The explanatory notes state that products that are applied to hair or parts of the human body other than the scalp are not covered under CTH 3305 but may fall under CTH 3307. 2.9.11 CTH 3307 covers 'pre-shave, shaving or after shave or after-shave preparations, personal deodorants, bath preparations, depilatories and other perfumery, cosmetic or toilet preparations, not elsewhere specified or included; prepared room deodoriseser....
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....odorising rooms, including odoriferous preparations used during religious rites: (1) Preparations for perfuming rooms and odoriferous preparations used during religious rites. They usually operate by evaporation or burning, e.g. "Agarbatti", and may be put up as liquids, powders, cones, impregnated papers, etc. Certain of these preparations may be used for masking an odour. Perfumed candles are excluded (heading 34.06). (2) Prepared room deodorisesers, whether or not perfumed or having disinfectant properties. Prepared room deodorisesers consist essentially of substances (such as lauryl methacrylate) which act chemically on the odours to be overcome or other substances designed to physically absorb odours by. for example, van der Waals bonds. When for retail sale they are generally put up in aerosol cans. Products, such as activated carbon, put up in packings for retail sale as deodorisers for refrigerators, cars, etc. are also classified in this heading. (V) Other products, such as: (1) Depilatories. (2) Scented sachets containing parts of aromatic plants used for perfuming linen cupboards. (3) Perfumed papers and papers impreg....
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....functional test of the product wherein what is considered is use of the product by the end consumer and its primary function. Therefore, the functional test.of Keranat does not merit the classification of the said product under CTHs 3305 or 3307. Hence, Keranat is not classifiable under CTHs 3301, 3305 or 3307. 2.10 Whether Keranat is classifiable under CTH 3824 2.10.1 Chapter 38 falls under Section VI of the Import Tariff which is titled as 'products of the chemical or allied industries'. CTH 3824 under Chapter 38 covers the following sub-headings and tariff items: 3824 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 00 - Prepared binders for foundry moulds or cores 3824 30 00 - Non-agglomerated metal carbides mixed together or with metallic binders 3824 40 - Prepared additives for cements, mortars or concretes: 3824 40 10 --- Damp proof or water proof compounds 3824 40 90 --- Other 3824 50 - Non-refractory mortars and con....
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....es of chemicals with foodstuffs or other substances with nutritive value, of a kind used in the preparation of human foodstuffs (generally, heading 2106); (c) products of heading 2404; (d) slag, ash and residues (including sludges, other than sewage sludge), containing metals, arsenic or their mixtures and meeting the requirements of Note 3 (a) or 3(b) to Chapter 26 (heading 2620); (e) medicaments (Heading 3003 or 3004); (f) spent catalysts of a kind used for the extraction of base metals or for the manufacture of chemical compounds of base metals (heading 2620), spent catalysts of a kind used principally for the recovery of precious metal (heading 7112) or catalysts consisting of metals or metal alloys in the form of, for example, finely divided powder or woven gauze (Section XIV or XV). 2. (A) For the purpose of heading 3822, the expression "certified reference materials" means reference materials which are accompanied by a certificate which indicates the values of the certified properties, the methods used to determine these values and the degree of certainty associated with each value and which are suitable for analytical, calibratin....
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....ire special disposal procedures (for example, soiled dressings, used gloves and used syringes); (b) waste organic solvents; (c) wastes of metal pickling liquors, hydraulic fluids, brake fluids and anti-freezing fluids; and (d) other wastes from chemical or allied industries. The expression "other wastes" does not, however, cover wastes which contain mainly petroleum oils or oils obtained from bituminous minerals (heading 2710). 7. For the purposes of heading 3826, the term "biodiesel" means mono-alkyl esters of fatty acids of a kind used as a fuel, derived from animal or vegetable or microbial fats and oils whether or not used." 2.10.3 Sub-headings 3824 81 to 3824 89 provides as under: "3. Sub-headings 3824 81 to 3824 89 cover only mixtures and preparations containing one or more of the following substances : oxirane (ethylene oxide); polybrominated biphenyls (PBBs); polychlorinated biphenyls (PCBs); polychlorinated terphenyls (PCTs); tris(2,3- dibromopropyl) phosphate; aldrin (ISO); camphechlor (ISO) (toxaphene); chlordane (ISO); chlordecone (ISO); DDT (ISO) (clofenotane (INN); 1,1,1-trichloro-2,2-bis(p- chlorophenyl)ethane)....
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....they act as pigments. These preparations consist of mixtures of two or more natural products (chalk, natural barium sulphate, slate, dolomite, natural magnesium carbonate, gypsum, asbestos, mica, tale, calcite, etc.), of mixtures of these natural products with chemical products, or of mixtures of chemical products (e.g., mixtures of aluminium hydroxide and barium sulphate). This category also includes finely ground natural calcium carbonate ("Champagne white"), each particle being coated, by a special treatment, with a water-repellent film of stearic acid." 2.10.6 The examples referred to in the above paragraph do not appear to include the natural ingredient of plants/vegetables and seeds. As discussed above, Keranat is a plant-derived formulation consisting of millet seed extract, wheat extract, rosemary extract, and sunflower oil as a carrier. It does not undergo synthetic modification or industrial processing typical of chemical preparations. 2.10.7 Further, CTH 3824 is a residual classification, to be used only where no other heading applies. In this case, more specific and appropriate headings are available as discussed above, and therefore, Keranat does not mer....
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....er Chapter 21 as food preparation, under Chapter 30 as a medicament, under Chapter 33 as an essential oil/ olcoresin/ adoriferous preparation or under Chapter 38 as a miscellaneous chemical preparation. Accordingly, the applicable classification for the subject goods is tariff item 1302 19 39 as "Other" extracts under Heading 1302. 2.13 Issues requiring advance ruling and applicant's understanding 2.13.1 In the light of aforementioned, the Applicant seeks to ask the following questions for Advance Ruling and its interpretation of the question will be as under: Question No. 1: "Whether the product in question i.c. Keranat which is in the nature of a compound vegetable extract when imported into India is classifiable under Customs Tariff Item (CTI) 1302 of the First Schedule to the Customs Tariff Act, 1975 (the Tariff)" Applicant's understanding: Yes Question No. 2: "Should the product in question in the present application i.c. Keranat be classifiable as 'animal, vegetable or microbial fats and oils and their cleavage products; prepared edible fats; animal or vegetable waxes' in CTHs 1512 or 1515." Applicant's understa....
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....ribed the composition of Keranat approximately as under: * Millet seed extract -60% * Sunflower seed oil - 29.93% * Wheat extract - 10% * Rosemary extract -0.07% The manufacturing process indicates extraction of vegetable constituents from millet and wheat, followed by blending and standardization with sunflower oil and rosemary extract. 3.1.1 Examination of classification under CTH 1302 Heading 1302 covers vegetable saps and extracts, pectic substances, pectinates and other mucilages derived from vegetable products. The applicant has claimed that Keranat is a compound vegetable extract classifiable under CTH 1302. However, classification under Heading 1302 is applicable to vegetable extracts as such, which retain the essential character of extracts obtained from plant material. In the present case, Keranat is not merely a plant extract. It is a deliberately formulated preparation consisting of multiple ingredients, namely millet extract, wheat extract, rosemary extract and sunflower oil. The product has undergone blending and standardization to obtain a specific preparation for use in nutraceutical manufacture. The addition of ....
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....ients such as vitamins and minerals. Such preparations, which are not covered specifically elsewhere in the tariff, fall under Heading 2106. The essential character of Keranat is that of a formulated nutraccutical ingredient preparation and not an individual vegetable extract. Applying Rule 3(b) of the General Rules for Interpretation of the Import Tariff, where goods consist of a mixture or combination of materials, classification is determined by the component which gives the goods their essential character. In the present case, the combination of plant extracts with carrier oil creates a distinct preparation intended for nutraceutical use. Therefore, Keranat merits classification under CTI 21069099 - Food preparations not elsewhere specified or included - Other. Question No. 1: "Whether the product in question i.e. Keranat which is in the nature of a compound vegetable extract when imported into India is classifiable under Customs Tariff Item (CTI) 1302 of the First Schedule to the Customs Tariff Act, 1975 (the Tariff)" Applicant's understanding: No Question No. 2: "Should the product in question in the present application i.c. Keranat be ....
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....02 and, therefore, the residuary heading 2106 cannot be invoked. 4.3 The Applicant stated that Keranat contains approximately 60% millet seed extract, 10% wheat extract, 29.93% sunflower seed oil and 0.07% rosemary extract. Sunflower oil acts as a carrier/standardising medium and rosemary extract as an antioxidant. According to the Applicant, the presence of multiple vegetable extracts and standardisation does not take the product outside CTH 1302. 4.4 The Applicant relied upon the HSN Explanatory Notes to Heading 1302, submitting that the said heading covers compound as well as standardised vegetable extracts. It was contended that the product has not acquired the character of a food preparation merely because it contains more than one plant extract or is standardised with sunflower oil. 4.5 The Applicant further submitted that Keranat is imported in bulk packs as a raw material/ingredient and is not a finished food preparation, dietary supplement or ready-to- consume nutraceutical product. Its subsequent use by third-party manufacturers in nutraceutical tablets according to the Applicant, cannot determine its classification at the time of importation. 4.6 With regard ....
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....have also examined the relevant provisions of the Customs Act, 1962, the First Schedule to the Customs Tariff Act, 1975, the General Rules for the Interpretation of the import Tariff (GIR), the IISN Explanatory Notes and the judicial precedents relied upon by the Applicant. I have further examined the product's manufacturing process, composition, technical documents and other material placed on record. 6.2 The first schedule to the Customs Tariff Act, 1975 mandates the General Rules of Interpretation ("GRIs") which are to be applied to determine classification under the Customs Tariff. Classification of goods in the Nomenclature shall be governed by the following principles: 1. The titles of Sections, Chapters and sub-Chapters are provided for ease of reference only; for legal purposes, classification 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 following provisions: ..................... 3. When by application of Rule 2 (b) or for any other reason, goods are, prima facie, classifiable under two or more headings, c....
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.... the following steps: ⮚ Crushing of whole millet seeds to millet flour. ⮚ Addition of cold-pressed sunflower oil by CO2 extraction to millet flour to get standardized millet seed extract. ⮚ Extraction of wheat extract from wheat seed by way of ethanolic extraction (i.e. extraction with ethanol), and filtration (i.e. removal of ethanol by vacuum concentration). ⮚ Addition of wheat seed extract to standardized millet seed extract. ⮚ Standardization of the mixture of millet and wheat extract with cold-pressed sunflower oil and addition of CO2 rosemary leaves extract. ⮚ Final product - Keranat 6.5.3 The composition breakdown of Keranat is as follows: Ingredients Role Standardized millet seed extract - 89.8% Millet seed extract - 60% Active ingredient Sunflower seed oil -29.80% Excipient Wheat Extract - 10% Wheat extract -10% Active ingredient Rosemary extract - 0.2% Rosemary extract - 0.07% Antioxidant Sunflower seed oil - 0.13% Excipient Thus, the Millet seed extract and wheat extract constitute the principal active ingredients of Keranat, ....
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....iffer from the essential oils, resinoids and extracted oleoresins of heading 33.01, in that, apart from volatile odoriferous constituents, they contain a far higher portion of other plant substances (e.g., chlorophyll, tannins, bitter principles, carbohydrates and other extractive matter) The abovementioned explanatory notes further states that: "Saps are usually thickened or solidified. Extracts may be in liquid, paste or solid form. "Tinctures' are extracts still dissolved in the alcohol by means of which they are extracted; the so-called 'fluid extracts' are solutions of extracts in, for example, alcohol, glycerol or mineral oil. Tinctures and fluid extracts are generally standardised (for instance, pyrethrum extract may be standardised by adding mineral oil to produce commercial grades with a standard pyrethrins content of, e.g., 2%, 20% or 25%). Solid extracts are obtained by evaporating the solvent. Inert substances are sometimes added to certain extracts so that they can be more easily reduced to powder (e.g., belladonna extract, to which powdered gum Arabic is added), or to obtain a standard strength (for instance, certain quantities of starch are ad....
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....bstances may be added to an extract for obtaining a standard strength or for facilitating its handling. Such additions do not necessarily alter the classification of the extract. Accordingly, the mere presence or addition of another substance, such as sunflower seed oil, cannot automatically take Keranat outside Heading 1302. The relevant question is whether, because of such addition, the product has acquired a different character, such as that of a food preparation, medicament or another product specifically covered under a different heading. The HSN Notes also provide that vegetable extracts are excluded from Heading 1302 where, because of the addition of other substances, they acquire the character of food preparations, medicaments, etc. They may also be excluded where they have undergone highly refined or purified processes, such as chromatographic purification, ultrafiltration or additional extraction cycles after the initial extraction. Therefore, the key issue is not merely whether Keranat contains ingredients other than vegetable extracts. The relevant question is whether the addition of sunflower seed oil and rosemary extract, together with the manufacturing and standar....
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....f, make the standardising substance the principal or active constituent of the preparation. 6.7.1 Functional role of sunflower seed oil In the present case, the material placed on record indicates that approximately 29.93% cold-pressed sunflower seed oil is used in Keranat as a carrier, diluent and medium for standardisation. The expression "cold-pressed" describes the method by which the oil is obtained from sunflower seeds. It does not, by itself, establish the function performed by the oil in the finished product. The relevant question is therefore not merely how much sunflower oil is present, but why it is present and what it does in the formulation. In this regard, reference may be made to the Handbook of Pharmaceutical Excipients, Sixth Edition, edited by Raymond C. Rowe, Paul J. Sheskey and Marian E. Quinn. The said reference work recognises sunflower oil as an excipient having various formulation-related functions, including diluent, emollient, emulsifying agent, solvent and tablet binder. This demonstrates that sunflower oil is capable of performing supporting technological functions in a formulated preparation and that its presence in a formulation does not by it....
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....produce commercial grades with a standard pyrethrins content of, e.g., 2%, 20% or 25%). Solid extracts are obtained by evaporating the solvent. Inert substances are sometimes added to certain extracts so that they can be more easily reduced to powder (e.g., belladonna extract, to which powdered gum Arabic is added), or to obtain a standard strength (for instance, certain quantities of starch are added to opium in order to obtain a product containing a known portion of morphine). The addition of such substances does not affect the classification of these solid extracts. However, extracts may not be subjected to additional extraction cycles or to purification processes, such as chromatographic purification, that increase or decrease certain compounds or compound classes to a degree that cannot be achieved solely by means of initial solvent extraction. Extracts may be simple or compound. Simple extracts are obtained by the treatment of only one variety of plant. Compound extracts are obtained either by mixing simple extracts or by treating mixtures of different varieties of plants. Compound extracts (whether in the form of alcoholic tinctures or in any other forms) therefore contain t....
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....tween an ingredient which gives the product its essential character and an ingredient which merely facilitates the formulation of that product. In the present case, the material on record supports the latter position in respect of sunflower seed oil. 6.7.3 Rosemary extract The same reasoning applies, though for a different functional reason, to rosemary extract. Rosemary extract is present in Keranat only in approximately 0.07% and, according to the material on record, its function is that of an antioxidant. Its presence is therefore incidental to the preservation and stability of the formulation and does not make rosemary extract the principal constituent of the product. The presence of rosemary extract should accordingly be examined by reference to its function rather than merely by reference to the fact that it is another botanical ingredient. Its very small proportion and stated antioxidant function do not indicate that Keranat has acquired the character of a separate rosemary-based preparation. 6.7.4 Whether the additions change the character of the product The next question is whether the addition of sunflower oil and rosemary extract has changed the character ....
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....cific entries based on their usage. The chapter note of Chapter 13 makes this abundantly clear that 13.02 covers only those plant extracts which are in the form of raw material and it does not cover end products made out of these raw materials; the impugned product is not a raw material but an end product itself to be used as a fertilizer and not going to be used as an input in any product meant for human consumption; therefore, cannot be C/523/2010 & C/606/2010 covered under CTH 13.02; it is class apart from the products which are covered under CTH 13.02." 6.7.6 Accordingly, the presence of approximately 29.93% sunflower seed oil and approximately 0.07% rosemary extract cannot, by itself, be treated as sufficient to exclude Keranat from Heading 1302. The proper approach is to examine the product as a whole, keeping in view the nature of the botanical extracts, the functional role of the added substances, the intended use of the imported goods and the effect of those additions on the essential character of the product. On that basis, the additions in the present case appear to perform only supporting and technological functions and do not, on the material available, confer upon ....
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....refore, even if Rule 3(b) is applied, the essential character of Keranat is attributable to its botanical extracts, and not to the carrier/standardizing medium. 6.10 Rule 1 vs Rule 3(b) The Applicant principally relied upon Rule 1 of the GIR. Since Heading 1302 specifically covers vegetable saps and extracts and the HISN Notes expressly recognize compound and standardized extracts, the classification can substantially be determined under Rule 1 itself. Rule 3(b) is required only where classification cannot be resolved under the preceding rules. The mere fact that a product contains several constituents does not automatically require application of Rule 3(b), particularly where the IISN Notes themselves recognize compound extracts. Nevertheless, even when the essential-character test under Rule 3(b) is independently considered, it leads to the same conclusion: the botanical extracts impart the essential character of Keranat. 6.11 Determination of Correct Tariff Item Once the subject product, Keranat, is held to be appropriately classifiable under Heading 1302, the next issue for determination is the appropriate tariff item at the eight-digit level. CTH 1302 under Chapter....
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....vers "Vegetable saps and extracts; pectic substances, pectinates and pectates, agar-agar and other mucilages and thickeners, whether or not modified, derived from vegetable products." The relevant tariff structure under Heading 1302, inter alia, provides specific tariff items for extracts of certain named plants/products, followed by the residual tariff item 1302 19 39 ---- Other. The tariff items under sub-heading 1302 19 specifically enumerate ( --- ) extracts of various products, including belladonna, cascara sagrada, nux-vomica, ginseng, agarose, neem, gymnema, garacenia and cambodge, Withania somnifera, Bacopa monnieri, Berberis aristata, Boswellia serrata, Emblica officinalis, Ocimum sanctum. Capsicum anmium, Phaseolus vulgaris, Piper nigrum, Pierocarpus marsupium, Punica granatum, Salacia reticulara, Tagetes erecta, Curcuma longa and Zingiber officinale. The tariff further provides separate entries fer CNSE and other specified products, while CTI 1302 19 39 covers "Other" extracts. The Applicant bad initially sought classification of the subject goods under CTI 1302 19 19. However, consequent upon the tariff restructuring effective from 01.05.2026, the Applicant subseq....