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2021 (7) TMI 1334 - AAR - CustomsClassification of imported goods - preparation/product of Betel nut (Areca Nut) commonly known as “Supari” (Boiled Supari) - the goods as described which does not contain lime or katha (catechu) or tobacco but may not contain any other ingredients, such as food starch, cardamom, copra, mulethi, menthol (flavours), perfumes etc. - to be classified under CTH 2106 90 30 as food preparation or not - HELD THAT:- The basic raw material for Boiled Supari is raw betel nut, which is classifiable under Chapter 8, more specifically sub-heading 0802 80. I also note that Chapter 8 covers only edible nuts; inedible nuts and fruits being excluded by virtue of Chapter Note 1; and that betel nut/supari are masticatory. However, Boiled Supari have been subjected to certain processes resulting in the question being posed whether the said processes are substantive enough to consider Boiled Supari as “preparation of betel nut” that would make them classifiable under Chapter 21 by virtue of Supplementary Note 2 of Chapter 21. Alternatively, whether the processes carried out on the same for cleaning, preserving and boiling are too minor to fall short of rendering them as preparations of betel nuts. Further, it would be inadvisable and inappropriate to approach the issue of classification of the said goods solely with the prism of the positive nature of Supplementary Note 2 to Chapter 21, as it seems to have been done in the order of the erstwhile AAR. The processes involved in making Boiled Supari are clearly covered by the Chapter Note 3 to Chapter 8. It is also found that in the instant case, betel nuts after being boiled are dried; and this fact per se would not exclude the end-products from the scope of “dried nuts”. Therefore, it is concluded that the processes to which raw betel nuts have been subjected to obtain Boiled Supari is squarely in the nature of processes referred to in the Chapter Note 3 to Chapter 8 and HSN Note. Therefore, at the end of the said processes, the betel nuts retain the character of betel nut and do not qualify to be considered as “preparations” of betel nut, which is sine qua non for a goods to be classifiable under Chapter 21. It is thus concluded that during the personal hearing, upon being explained the scope of the aforesaid two competing headings, the applicant accepted that given the processes involved in obtaining Boiled Supari, the same is more appropriately classifiable under sub-heading 0802 80 10. Boiled (whole) Supari is not classifiable under sub-heading 2106 90 30 as food preparation; instead it is more appropriately classifiable under sub-heading 0802 80 10.
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