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2022 (1) TMI 621 - AAR - CustomsClassification of import goods - preparation of betel nut commonly known as Supari - API supari, Chikni supari, unflavoured supari, boiled supari and boiled & cut supari together - whether or not containing added ingredients such as food starch spices, mulethi. menthol (flavours), perfume etc. - not containing lime or katha (catechu) or tobacco - goods classifiable under Chapter/Heading 2106 90 30 as Food Preparation or not - HELD THAT:- It is admitted that boiling is an irreversible process, a boiled betel nut would be distinct from unboiled betel nut, and a boiled betel nut cannot be “unboiled” in reverse. However, it is equally obvious that boiling per se does not result in obtaining a preparation of betel nut. Speaking more generally, in view of the design of the Schedule to the CTA, HSN and plethora of judgments, besides common understanding and parlance, every irreversible process does not result in obtaining a new product with a distinct classification even at the eight or ten-digit level; and every irreversible process does not result in coming into being of a “preparation of the raw material”. The processes to which raw betel nuts have been subjected to obtain API supari, Chikni supari, unflavoured supari, boiled supari and boiled & cut supari are 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. Flavoured supari - whether the addition of special flavouring agents would render the betel nuts into preparations of betel nuts, classifiable under Chapter 21? - HELD THAT:- In a recent judgment of the CESTAT, Chennai, in the case of S.T. Enterprises [2021 (3) TMI 27 - CESTAT CHENNAI], the Hon’ble Tribunal has noticed that the question is whether by mere boiling and drying whole betel nut it would merit classification under 2106 90 30 and observed that it is needless to say that the earlier decision of the Authority of Advance Rulings are binding and applicable to the parties to the litigation only. The Hon’ble Tribunal has also observed that since the imported goods are betel nuts whole, these would merit classification under Chapter 8. It is concluded that all the six goods placed before me for consideration, i.e. API supari, chikni supari, unflavoured supari, flavoured supari, boiled supari, boiled & cut supari merit classification under Chapter 8 of the First Schedule to the Customs Tariff Act, and more precisely, under the Heading 0802 - the said six goods are not classifiable under sub-heading 2106 90 30, as contended by the applicant, since they have not attained the character of “preparations” of betel nut, which is sine qua non for a goods to be so considered.
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