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2021 (5) TMI 1036 - AAR - CustomsClassification of goods - API/boiled supari - Chikani supari - Unflavoured supari - Flavoured supari - merits classification under Chapter 8 of the Customs Tariff or not? - HELD THAT:- No ruling can be given in respect of classification of API/boiled supari, which, according to both the applications, undergo the same processes on the raw/green nut. The arguments of the Learned Counsel for the applicants that the products intended for import by them undergo roasting and boiling and therefore do not merit classification under Chapter 8 of the Customs Tariff need to be rejected when the notes to Chapter 8 are read together with the relevant HSN Explanatory Notes. In view of the relevant Chapter Notes and HSN Explanatory Notes, the processes of roasting and boiling alone are not sufficient to take the products under consideration here out of the purview of Chapter 8. So far as the argument that Supplementary Note 2 to Chapter 21 shouldn’t be made redundant is concerned, it is very clear that so far as chikni supari and unflavoured supari are concerned, there is no doubt regarding inapplicability of the said note to these products. Hon’ble Calcutta High Court in the case of Killing Valley Tea Co. v. Secretary to State [1920 (5) TMI 1 - CALCUTTA HIGH COURT] has held that a tea leaf remains the same even after being subjected to mechanical processes like withering, crushing, roasting, fermenting, etc., is a definite pointer to the principle that need to be applied for classification in such matters. Hon’ble Supreme Court’s in their decision dated 11-9-1979 in the case of D.S. Bist and Ors. [1979 (9) TMI 168 - SUPREME COURT] has held that all agricultural produce undergoes some processing on or outside the farm in order to make it non-perishable, transportable, and marketable and just because processing is a bit longer or complicated wouldn’t rob the produce of its agricultural character. The observations of the Hon’ble Supreme Court in the case of M/s. Crane Betel Nut Powder Works [2007 (3) TMI 6 - SUPREME COURT], that the process of cutting betel nuts into small pieces and addition of essential/non-essential oils, menthol, sweetening agent, etc., did not result in a new and distinct product having a different character and use is also an extension of the same line of reasoning. This decision of the Hon’ble Supreme Court has been subsequently followed by the Chennai Bench of the Hon’ble Tribunal in the case of Azam Laminators [2019 (3) TMI 782 - CESTAT CHENNAI] where scented betel nut was being manufactured by cracking of dried betel nut into small pieces, and thereafter, gently heating it with addition of vanaspati oil, sweetening and flavouring agents and this product classifiable under sub-heading 0802 90 19 of Central Excise Tariff which is aligned with customs tariff. Thus, even flavoured supari merits classification under Heading 0802 of the Customs Tariff and not under Heading 2106 as argued by the applicants - ruling in respect of API/boiled supari - application disposed off.
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