TMI Blog2021 (8) TMI 1309X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal in Appellant s own case for the consignments of the identical goods, imported previously, the impugned order is liable to be set aside. Appeal allowed - decided in favor of appellant. - Customs Appeal No.75228 of 2021 - FINAL ORDER NO. 75732/2021 - Dated:- 26-8-2021 - SHRI P.K. CHOUDHARY, MEMBER (JUDICIAL) AND SHRI RAJU, MEMBER(TECHNICAL) Shri Rahul Tangri, Advocate for the Appellant (s) Shri M.P.Toppo, Authorized Representative for the Respondent (s) ORDER The facts of the case in brief are that the Appellant Company is engaged in the business of import and selling of carbonated food drinks such as Big Cola, Big Orange Cola, Big Lemon etc. classifiable under Tariff Item 2202 99 20 of the Customs Tariff Act, 1975 and specified at Sl. No.48 under Schedule-II as fruit pulp or fruit juice based drinks of Notification No.1/2017-Integrated Tax (Rate) dated 28.06.2017 ( IGST Rate Notification ), taxable @ 12%. It is claimed by the Appellant that the imported product is in conformity with clause 3-A to Regulation 2.3.30 of Food Safety and Standards (Food Products Standards and Food Additives) Regulations, 2011 as amended (hereinafter referred to as FSSA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... phs of the Tribunal s Order are being reproduced below for ready reference:- 12. We have heard both sides through video conferencing have gone through the records of the case and considered the submissions made by both sides. We have also examined the labels produced before us by the learned Counsel of the respondent and the test reports. There is no dispute regarding the facts of the case. The goods are sold as carbonated beverage with fruit juice . In the case of lime, the fruit juice content is 2.5% whereas in the case of other fruit, such as, apple the content is 5%. There are also products named Big Orange which has orange flavour but contains 5% apple juice and no orange juice but has only pictures of cut orange. Similarly, Big Kids Jeera does not appear to have any Jeera but only apple juice. To that extent, the representation on the labels appears to be inaccurate but this does not affect the classification of the products since there is no dispute that all these are carbonated beverages with fruit juice . The products in question are not fruit or vegetable juices themselves which would be classifiable under Heading 2009. It is also not in dispute that the Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 30% 13. The Schedule to the Customs Tariff Act, 1975 (commonly referred to as Customs Tariff) is based on, although it is not identical to, the Harmonised System of Nomenclature (HSN)-an internationally recognised scientific method of classifying all goods. Sometimes there are differences between the HSN and the Customs Tariff in which case, the latter is relevant for determining the duty liability under the Customs Act. In view of the explanation to this effect in the IGST Notification specifying the rates of IGST chargeable on different goods, IGST is also to be charged as per the classification under the Customs Tariff. Customs Tariff, groups goods into Sections, each of which is further divided into Chapters with a two digit Chapter number. Within each Chapter, there are four digit headings which are further divided into six digit and still further divided into eight digit tariff headings. 14. Further, in the Customs Tariff, groups of articles are prefixed by a Single dash (-) or Double Dash (--) or triple dash (---). Wherever there is a single dash, it is to be read as a sub-classification of the article ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the essential character of the goods in question is Carbonated water and hence they should be classified accordingly. 19. Often, there could be doubt as to how a particular good should be classified when it matches the description of more than one Tariff heading or sub-heading in the Customs Tariff. The General Rules of Interpretation of the Customs Tariff help resolve such differences. The relevant extract of these Rules is below: THE GENERAL RULES FOR THE INTERPRETATION OF IMPORT TARIFF Classification of goods in this Schedule 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: 2. (a) Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as presented, the incomplete or unfinished articles has the essential character of the complete or finished ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ription and not under Chapter 72 as Articles of Iron and Steel). The third factor which determines the classification is as to what gives the goods their essential character. If none of these resolve the issue, the last of the conflicting entries in the tariff prevails. 21. Mixtures of articles can sometimes be confounding. A simplistic way of deciding is to go by the predominant weight or volume which can sometimes give absurd conclusions. A cup of coffee, for instance, is predominantly hot water. It also has milk, sugar and (instant) coffee powder. A couple of teaspoons of sugar makes the coffee sweet to taste but a couple of teaspoons of coffee powder makes it too strong and undrinkable. The smallest component of the drink is usually the coffee powder which imparts the drink its essential character and the predominant hot water is irrelevant. Nimbu pani has lime juice, water and sugar of which the lime juice, the smallest component defines the drink. 22. Ice-cream is neither predominantly ice nor cream nor sugar. It is predominantly (at least 50%) air.Water-melon is 99% water. Human body is also predominantly comprised of water. All matter in the universe, with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rinks and not the fruit juices. In our view both components are important. As carbonated beverages, they can be classified under 2202 10 20/ 22021090 (as claimed by the Revenue). As fruit juice based drinks, they could as well be classified under 2202 99 20 (as claimed by the assessee). In our view neither carbonated beverage alone nor fruit juice alone gives the essential character of the products in question; both contribute to its essential character. The issue cannot be resolved as per Rule 3(a) and 3(b) of the Rules of Interpretation and therefore we need to resort to Rule 3(c) which reads as follows: 3 (c) When goods cannot be classified by reference to (a) or (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration. Since Customs tariff heading 22029920 comes last in the order, it prevails and the goods are classifiable under this heading. 26. We find that the Hon ble Supreme Court in the case of Parle Agro (supra) examined the classification of appy fizz which was a drink containing apple juice as well as carbonated water and held that the product is correctly classifiable under 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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