In re Golden Enterprises (CAAR Mumbai)
Summary: M/s Golden Enterprises filed three applications before the Customs Authority for Advance Rulings, New Delhi seeking advance rulings concerning “Oven Roasted Areca Nuts”. Applications No. 23/2026-27 and 24/2026-27 were received on 08.05.2026 and Application No. 34/2026-27 was received on 03.06.2026. The applicant sought a ruling on classification under the First Schedule to the Customs Tariff Act, 1975 and on eligibility for concessional duty benefits under Notification No. 46/2011 dated 01.06.2011.
The two questions raised were whether Oven Roasted Areca Nuts were classifiable under heading 2008, subheading 200819 and tariff item No. 20081991, and, if so, whether the exemption from duty of customs under Sl. No. 172 of Notification No. 46/2011 dated 01.06.2011 would apply. The applicant later requested that the applications be decided on the basis of the existing record and submissions and specifically stated that it did not wish to avail the opportunity of Personal Hearing.
The Authority first considered maintainability under Section 28-I of the Customs Act, 1962. The relevant statutory provision permits the Authority, after examining the application and records, to allow or reject an application, but its first proviso prevents allowance where the question raised is already pending in the applicant’s case before a customs officer, the Appellate Tribunal or a Court, or is the same as a matter already decided by the Appellate Tribunal or any Court.
The Authority explained that the advance ruling mechanism is a trade facilitation measure intended to reduce litigation and provide certainty. It considered the distinction between an issue pending in the applicant’s own case and an issue already decided by an appellate tribunal or Court. In this context, the Authority relied on the Supreme Court decision in Union of India v. Kamlakshi Finance Corporation Ltd., 1991 (55) ELT 433 (SC), for the binding nature of precedent and the obligation of subordinate authorities to follow higher judicial pronouncements.
The Authority held that the first question concerning classification of oven roasted areca nuts was squarely covered by the judgment of the Hon’ble Madras High Court in M/s Shahnaz International Pvt. Ltd., reported at 2023 (386) E.L.T. 214 (Mad.). In consequence, and in adherence to judicial discipline and the binding precedent, the Authority refrained from pronouncing any ruling on the classification question in terms of Section 28-I(2)(b) of the Customs Act, 1962.
The second question concerned the benefit of basic customs duty under Sl. No. 172 of Notification No. 46/2011-Customs dated 01.06.2011. The Authority observed that this question had not been covered by the Madras High Court judgment in M/s Shahnaz International Pvt. Ltd. However, it held that the statutory framework governing advance rulings neither contemplated nor permitted partial rejection of an application. The scheme required the application to be admitted or rejected in its entirety on the grounds expressly prescribed by the statute.
Accordingly, after refraining from ruling on the classification question because of the earlier judicial decision, the Authority also declined to decide the exemption question separately. It concluded that the entire application was liable to be rejected in toto. The applications were therefore “not allowed and disposed of accordingly”.
The order thus turns on maintainability and judicial discipline rather than a fresh determination of the tariff classification or exemption entitlement of the applicant’s goods. The Authority did not itself pronounce a new classification ruling for Golden Enterprises and did not separately adjudicate the entitlement under Sl. No. 172 of Notification No. 46/2011.
Cases Discussed
- Union of India v. Kamlakshi Finance Corporation Ltd., 1991 (55) ELT 433 (SC).
- M/s Shahnaz International Pvt. Ltd., 2023 (386) E.L.T. 214 (Mad.).
FULL TEXT OF THE ORDER OF CUSTOMS AUTHORITY OF ADVANCE RULING, MUMBAI
M/s Golden Enterprises, Unit No. 58, 10th Floor, Shushma Infinium, Near Ambala-Delhi Highway, Zirakpur, Punjab-140603 having IEC No. IREPK4279J and PAN IREPK4279J (the applicant, in short) filed three applications CAAR-1 before the Customs Authority for Advance Rulings, New Delhi (CAAR, in short) for seeking advance rulings. The applications No. 23/2026-27 & 24/2026-27 were received on 08.05.2026 and application no. 34/2026-27 was received on 03.06.2026 along with its enclosures in terms of Section 28H(1) of the Customs Act, 1962(hereinafter referred to as “the Act”). The Applicant is seeking advance ruling on the issue of Classification of the “Oven Roasted Areca Nuts” under the first Schedule of the Customs Tariff Act, 1975 and eligibility for concessional duty benefits under Notification No. 46/2011 dated 01.06.2011
2. The applicant has sought ruling in respect of the following question(s)
(i) “Whether the Oven Roasted Areca Nuts is classifiable under heading 2008, subheading 200819 and tariff iten No. 20081991 of the Customs Tariff?”
(ii) “If the item i.e.; Oven Roasted Areca Nut merits to be classified under tariff item no 20081991, whether exemption from Duty of Customs as provided under SI No. 172 of exemption Notification No. 46/2011 dated 01.06.2011 would apply to the goods under question?”
3. The applicant, vide letter dated 15.06.2026 and subsequent communication through e-mail dated 22.08.2026, requested that the present application may be decided on merits on the basis of the application and submissions already placed on record. The applicant specifically submitted that they were not desirous of availing the opportunity of Personal Hearing in the matter and requested that the application may kindly be disposed of on the basis of the existing records and submissions. Accordingly, the matter is taken up for decision on merits on the basis of the material available on record.
4. Findings, Discussion & Conclusion
4.1. I have gone through the application of advance ruling and relevant provisions in this regard. I consider it necessary to first address the question of maintainability of the present applications. Section 28-I(2) of the Customs Act, 1962 governs the admissibility of applications before the Customs Authority for Advance Rulings. The relevant part of that provision reads as under:
“28-I. Procedure on receipt of application: (1) On receipt of an application, the Authority shall cause copy thereof to be forwarded to the [Principal Commissioner of Customs or Commissioner of Customs] and, if necessary, call upon him to furnish the relevant records:
Provided that where any records have been called for by the Authority in any case, such records shall, as soon as possible, be returned to the Principal Commissioner of Customs or Commissioner of Customs)
(2) The Authority may, after examining the application and the records called for, by order, either allow or reject the application Provided that the Authority shall not allow the application question raised in the application is, where the
(a) already pending in the applicant’s case before any officer of customs, the Appellate Tribunal or any Court,
(b) the same as in a matter already decided by the Appellate Tribunal or any Court.”
4.2. From the above, I find that Section 28-I (2) of the Customs Act, 1962 governs the admissibility of applications before the Custom Authority for Advance Rulings (CAAR). The first proviso to Section 28-I (2) stipulates that the Authority shall not allow the application where the question raised in the application is (a) already pending in the applicant’s case before any officer of customs, the Appellate Tribunal or any Court; or (b) the same as in a matter already decided by the Appellate Tribunal or any Court.
4.3. Further, I understand that the entire mechanism of advance rulings is a trade facilitation measure introduced with the aim of reducing litigation and providing certainty to assessees, consistent with Article 3 of the WTO Trade Facilitation Agreement. The WTO framework itself recognizes two distinct situations where advance rulings may be declined: (a) when the issue is pending in the applicant’s own case, and (b) when the issue has already been decided by an appellate tribunal or court. The first is applicant-specific, whereas the second is applicant-agnostic. This distinction is necessary because advance rulings are implemented by Departmental officers who are duty bound to apply the law as settled in their jurisdiction. In India, this position is fortified by the ruling of the Hon’ble Supreme Court in Union of India v. Kamlakshi Finance Corporation Ltd., 1991 (55) ELT 433 (SC), which underscores the binding nature of precedent and the obligation of lower authorities to follow higher judicial pronouncements.
4.4. It is a settled principle of law that rulings of the Tribunal and Courts are binding on subordinate authorities. The CAAR, being a statutory authority under the Customs Act, is equally bound by such precedents. To allow fresh application on questions already adjudicated by higher judicial fora would risk the creation of conflicting rulings and introduce uncertainty, an outcome contrary to the very object of the advance ruling mechanism. Clause (b) therefore operates as a statutory reinforcement of judicial discipline, making it explicit that once a question has been conclusively determined by the Tribunal or Courts, the Authority cannot re-adjudicate the same issue at the behest of another party.
4.5. In the instant case, I observed that the first question raised regarding the classification of oven roasted areca nuts in the present applications is squarely covered by the judgment of the Hon’ble Madras High Court in the case of M/s Shahnaz International Pvt. Ltd. [2023 (386) E.L.T. 214 (Mad.)]. Therefore, in adherence to judicial discipline and binding precedent and in terms of Section 28-I(2)(b) of the Customs Act, 1962, I refrain from pronouncing any ruling on the question of classification raised in the instant applications.
4.6. Further, I observe that the applicant has also raised the issue of availment of duty benefit of BCD under SI No. 172 of exemption Notification No 46/2011-Customs Dated 01.6.2011. This question raised was not covered in the judgment of the Hon’ble Madras High Court in the case of M/s Shahnaz International Pvt. Ltd. However, I note that the statutory framework governing advance rulings neither contemplates nor permits the partial rejection of an application. The scheme envisages that an application must be admitted or rejected in its entirety on the grounds expressly prescribed by the statute.
4.7. As discussed above, in terms of Section 28-I(2)(b) of the Customs Act, 1962 and in adherence to the principles of judicial discipline and binding precedent, I deem it appropriate to refrain from pronouncing any ruling on the question raised in the instant application regarding classification of the subject goods. Further, with regard to the second question concerning eligibility to the benefit of Sl. No. 172 of Notification No. 46/2011-Customs dated 01.06.2011, I find that the statutory scheme governing advance rulings does not envisage or permit partial rejection of an application, therefore, the instant application is liable to be, and is accordingly, rejected in toto.
5. The applications are not allowed and disposed of accordingly.
Would you like the next order in the same TGCSK format or HTML-only?
