TMI Blog2024 (3) TMI 807X X X X Extracts X X X X X X X X Extracts X X X X ..... erred to in the Chapter Note 3 to Chapter 8 and HSN. 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 - HELD THAT:- The question to be answered is whether the addition of special flavouring agents would render the betel nuts into preparations of betel nuts, classifiable under Chapter 21. In this regard, the judgment of the Hon ble Supreme Court of India in the case of M/s. Crane Betel Nut Powder Works [ 2007 (3) TMI 6 - SUPREME COURT] and of the CESTAT, Chennai in the case of M/s. Azam Laminators Pvt. Ltd. [ 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 marketed in small pouches as Nizam Pakku (in Tamil)/Betel Nut (in English), the Hon ble CESTAT held the resultant product classifiable under sub-heading 0802 90 19 of Central Excise Tariff and not under 2106 90 30 as supari for period after 7-7-2009] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her ingredients such as cardamom, copra, menthol, spices, sweetening agents. Further, the applicant has also described the process of preparation of the import items as under :- (A) API Supari - Following processes are conducted on raw green fresh betel nut : removing of large impurities by manual labour, boiling in water for 6 hours, mixing food starch, drying, polishing and packaging. (B) Chikni Supari - Following processes are conducted on raw green fresh betel nut : removing of large impurities by manual labour, slicing in small pieces, boiling in water for 6 hours, mixing food starch, drying, polishing and packaging. (C) Unflavoured Supari - Following processes are conducted on raw dried betel nut : removing of large impurities by manual labour, removing of small impurities by destoner, metal deflection (removal of metal item, if any), garbling, polishing in polishing machine, 3 stage cutting, blowing of weightless particles in blowers, gravity separation by automatic gravity separation machine, roasting in fire gas rotary roaster, metal detection by magnetic metal detectors and packaging. (D) Flavoured Supari - Following processes are conducted on raw dried betel nut : removi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny of the such product namely katha (catechu) or tobacco. 3.4 Further, the applicant rely on the findings dated 20-5-2021 of Hon ble Authority of Advance Ruling, Delhi in the case of M/s. Great Nuts Impex Private Ltd. [2021 (378) E.L.T. 692 (A.A.R. - Cus. - Del.)] wherein ruling covers all the various preparations of betel nut, which are subjected to various processes of cleaning, enhancing preservation, enhancing appearance or presentation and certain materials added. At the end of processes, betel nuts retain the character of betel nut and essential character of betel nut is not changed. Therefore, as per ruling, the items do not qualify as preparation of betel nut, which is sine qua non for goods to be classifiable under Chapter 21 of Customs Tariff Act, 1975. The ruling held that various items merit assessment under Chapter Heading 0802 of Customs Tariff Act, 1975. The applicant has further stated that, Chapter 8 covers, Edible fruit and nuts; peel of citrus fruit or melons and Note 3 of Chapter 8 provides that, dried fruits or dried nuts of this chapter may be partially rehydrated, or treated for the following purposes : (a) for additional preservation or stabilization (for ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave been received from the concerned Commissionerate wherein, it is inter alia stated that, there are two headings in the Customs Tariff which are applicable to areca nuts/betel nut and betel nuts product known as Supari; on plain reading of the supplementary Note 2 of Chapter 21, it is unambiguously clear that only the preparation of betel nuts falls under Chapter 21 and not the processed betel nuts; there is difference between preparation and processing; processing of betel nuts is a series of events and boiling may be only an event of that series; in other words, cleaning, boiling drying, mixing starch are a part of processing; even after completion of the process, the goods retain their original identity and its uses may also remain the same; on the other hand, the preparations containing betel nuts, as stipulated in the supplementary Note 2 to Chapter 21, means a preparation wherein betel nuts should be an ingredient, in other words, the product is made of betel nut, hence, it is different from the processed one; sub-heading 2106 90 covers items which are clear cut preparations, edible to the consumer; Chapter 21 needs ready-to-eat foods preparations, while the goods in the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Delhi? The AR replied that they do not have any such additional submissions to give. 6. Finding that the application is valid in terms of the provisions of the Customs Act, 1962 and the Customs Authority for Advance Rulings Regulations, 2021, having gone through submissions of the applicant, comments of the concerned Commissionerate and having heard the applicant, I proceed to examine the question on merits. 7. Since the question under the application for advance ruling relates to classification of goods proposed to be imported, guidance of the Harmonized Commodity Description and Coding System of the World Customs Organization (HSN, in short), to which India is a signatory, would be useful. 8.1 I note that the concerned Commissionerate has opined for classification under the Heading 0802. I note that advance ruling has been sought on classification of five different goods, each known as Supari in common trade parlance, albeit with differentiator, viz. API, Chikni, Unflavoured, Flavoured and Boiled. The basic raw material for each of the five goods is raw betel nut, which is classifiable under Chapter 8, more specifically sub-heading 0802 80. I also note that Chapter 8 covers on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el 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. 8.4 In the case of flavoured supari, the question to be answered is whether the addition of special flavouring agents would render the betel nuts into preparations of betel nuts, classifiable under Chapter 21. In this regard, the judgment of the Hon ble Supreme Court of India in the case of M/s. Crane Betel Nut Powder Works and of the CESTAT, Chennai in the case of M/s. Azam Laminators Pvt. Ltd. [2019 (367) E.L.T. A22 (Tri. - 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 marketed in small pouches as Nizam Pakku (in Tamil)/Betel Nut (in English), the Hon ble CESTAT held the resultant product classifiable under sub-heading 0802 90 19 of Central Excise Tariff and not under 2106 90 30 as supari for period after 7-7-2009] are relevant. Put simply, these decisions clearly imply that addition of flavouring agents do not change the character of the goods, meaning in the present case bet ..... X X X X Extracts X X X X X X X X Extracts X X X X
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