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Case Law Details

Case Name : In re Hi Tech Print Systems (CAAR Mumbai)
Appeal Number : Ruling No. CAAR/Mum/ARC/42/2023
Date of Judgement/Order : 15/05/2023
Related Assessment Year :

In re Hi Tech Print Systems (CAAR Mumbai)

CAAR find that the provisionally preserved betel nuts are not fit for immediate human consumption and they are more specifically covered under Chapter heading 0812 due to following chapter note.

Chapter note (4) provides as follows:

“4. Heading 0812 applies to fruit and nuts which have been treated solely to ensure their provisional preservation during transport or storage prior to use (for example, by Sulphur dioxide gas, in brine, in Sulphur water or in other preservative solutions), provided they remain unsuitable for immediate consumption in that state.”

Following are the four sub-headings under the above heading.

0812 10 00 –  Cherries
0812 90 –  Other:
0812 90 10 — Mango slices in brine
 0812 90 90 —  Other

This heading applies to fruit and nuts (whether or not blanched or scalded) which have been treated solely to ensure their provisional preservation during transport or storage prior to use (for example, by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions), provided they remain unsuitable for immediate consumption in that state. Though areca nuts are separately mentioned under 0802, nuts provisionally preserved but unsuitable in that state for immediate consumption, as the areca nuts in the present case, will get covered under heading 0812 which occurs later in the schedule and accordingly, the nuts that are provisionally preserved and not fit for immediate consumption need to be classified more specifically under heading 0812 90 90.

From the submission of the applicant I find that the subject product is treated with sulphur-di-oxide gas or sodium benzoate solution before packing and export for preservation. The said preservatives can be removed before consumption through simple processes, as explained at para 2 above, to make the product suitable for human consumption. It is observed that the subject goods remain unsuitable for immediate consumption in that state and need to be processed further to remove the preservatives to make the same suitable for human consumption. Thus, I find that the conditions of chapter note (4) as mentioned above are duly fulfilled and hence the said goods come within the ambit of Customs Heading 0812. Therefore, in view of the submissions made by the applicant, relevant legal provisions and the above discussions, I have reached a conclusion in the matter in respect of the questions asked in the CAAR- 1 application.

FULL TEXT OF THE ORDER OF CUSTOMS AUTHORITY OF ADVANCE RULING, MUMBAI

M/s Hi Tech Print Systems (hereinafter referred to as ‘the applicant’, in short) filed an application for advance ruling before the Customs Authority for Advance Rulings, Mumbai (CAAR, in short). The said application dated 18.01.2023 was earlier received in the secretariat of the CAAR, Mumbai on 24.01.2023 along with its enclosures in terms of Section 28H (1) of the Customs Act, 1962 (hereinafter referred to as the ‘Act’) and the same was later received with amendments on 3.2.2023. The applicant is seeking advance ruling on the classification of `Provisionally preserved Areca nut’ (subject goods) which they intend to import through the port of Tuticorin, Tamil Nadu. On the issue of whether the question(s) raised is pending in the applicant’s case before any officer of Customs, Appellate Tribunal or any Court of Law the applicant has replied in negative. Further on the issue of whether a similar matter as raised in the question(s) by the applicant has already been decided by the Appellate Tribunal or any Court, the applicant has again replied in negative. In their CAAR-1 application the applicant has claimed the classification of provisionally preserved areca nut/betel nut under CTH 0812 of the First schedule of the Customs Tariff Act, 1975. Applicant’s submissions are as follows:

2. The applicant proposes to import `Areca nut’ from Indonesia and other South East Asian countries. Areca nut is a tropical plant found all over South-East Asia. The tree belongs to the palm tree species and is from the Arecaceae family. The fruit (nut) of this tree is popularly Again, Chapter note (4) reads as follows:

“4. Heading 0812 applies to fruit and nuts which have been treated solely to ensure their provisional preservation during transport or storage prior to use (for example, by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions), provided they remain unsuitable for immediate consumption in that state.”

3.1 Heading 0812 covers fruits and nuts provisionally preserved but unsuitable in that state for immediate consumption. Following are the four sub-headings under the above four-digit heading.

0812 10 00 –  Cherries
0812 90 – Other:
0812 90 10 — Mango slices in brine
0812 90 90 —  Other

Though arecanuts are separately mentioned under 0802, as nuts provisionally preserved but unsuitable in that state for immediate consumption, the areca nuts in the present case will answer more precisely the description under heading 0812 which occurs later in the schedule and accordingly, the nuts that are provisionally preserved need to be classified under heading 0812 90 90.

3.2 In this respect the applicant has also submitted the certificate issued by the Professor and Head of the Department of Food Process Engineering, College of Food and Dairy Technology, Koduveli, Chennai in support of their claim. This certificate of Tamil Nadu Veterinary and Animal Sciences University, College of Food and Dairy Technology has stated as follows:

“The fruits and Nuts in general have a shorter life span and post-harvest they are preserved using preservatives like Benzoic Acid or Sulphur-di-Oxide gas which are basically used for inhibiting the growth of moulds and bacteria. The preservation process is done to ensure the fruits and nuts are not spoiled during transportation. These preserved products might have higher levels of SO2 or Benzoic acid. And they can be safely treated with Sodium Bi Carbonate (NaHCO3) and washed with plain water to remove the excess of Benzoic Acid. Benzoic acid gets neutralized to Sodium Benzoate in the process easily get dissolved in water and can be removed easily. Similarly, products preserved with Sulphur-di-oxide can be treated with Hydrogen peroxide by which the sulphur di oxide is oxidized to sulphate, and addition of Sodium Bi Carbonate during the process makes the process harmless, the excess peroxides formed can be removed by washing with plain water.”

4. The applicant indicated that they intend to import the said goods through the port of Accordingly, comments from the jurisdictional Principal Commissioner/ Commissioner of Customs were invited. However, no comments were received from the jurisdictional authority.

5. A personal hearing in the matter was held on 10.05.2023 wherein Shri. S. Murugappan, advocate represented the applicant. No one was present for the department d- OsclictIgnal

The chapter note 3 specifies the physical status of the goods along with corresponding processes that could be carried on those goods under this chapter. The areca/ betel nut is mentioned in Heading 0802 as well as 0812. The explanatory note to 1-leading 0802 states that This heading also covers areca (betel) nuts used chiefly as a masticatory. One of the main uses of the goods under CTH 0802 is masticatory.

 6.3 However, I find that the provisionally preserved betel nuts are not fit for immediate human consumption and they are more specifically covered under Chapter heading 0812 due to following chapter note.

Chapter note (4) provides as follows:

“4. Heading 0812 applies to fruit and nuts which have been treated solely to ensure their provisional preservation during transport or storage prior to use (for example, by Sulphur dioxide gas, in brine, in Sulphur water or in other preservative solutions), provided they remain unsuitable for immediate consumption in that state.”

Following are the four sub-headings under the above heading.

0812 10 00 –  Cherries
0812 90 –  Other:
0812 90 10 — Mango slices in brine
 0812 90 90 —  Other

This heading applies to fruit and nuts (whether or not blanched or scalded) which have been treated solely to ensure their provisional preservation during transport or storage prior to use (for example, by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions), provided they remain unsuitable for immediate consumption in that state. Though areca nuts are separately mentioned under 0802, nuts provisionally preserved but unsuitable in that state for immediate consumption, as the areca nuts in the present case, will get covered under heading 0812 which occurs later in the schedule and accordingly, the nuts that are provisionally preserved and not fit for immediate consumption need to be classified more specifically under heading 0812 90 90.

 6.4 From the submission of the applicant I find that the subject product is treated with sulphur-di-oxide gas or sodium benzoate solution before packing and export for preservation. The said preservatives can be removed before consumption through simple processes, as explained at para 2 above, to make the product suitable for human consumption. It is observed that the subject goods remain unsuitable for immediate consumption in that state and need to be processed further to remove the preservatives to make the same suitable for human consumption. Thus, I find that the conditions of chapter note (4) as mentioned above are duly fulfilled and hence the said goods come within the ambit of Customs Heading 0812. Therefore, in view of the submissions made by the applicant, relevant legal provisions and the above discussions, I have reached a conclusion in the matter in respect of the questions asked in the CAAR- 1 application.

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