In re NBG International Private Limited (CAAR Mumbai)
M/S. NBG International Pvt Ltd (having IEC No. AAICN7426L and hereinafter referred to as ‘the applicant’, in short) filed three applications (CAAR 1) for advance ruling before the Customs Authority for Advance Rulings, Mumbai (CAAR in short). The said applications were received in the secretariat of the CAAR, Mumbai on 30.10.2023 along with its enclosures in terms of Section 28H (1) of the Customs Act, 1962 (hereinafter referred to as the ‘Act’ also).
The applicant is seeking advance ruling on the classification of “Roasted Areca Nuts” in all three applications for imports through the port of Nhava Sheva, Chennai and Tuticorin.
2. Applicant has stated as follows in their statement of relevant facts having a bearing on the question(s) raised enclosed with the CAAR-1 applications:
2.1. That the applicant has observed that there is a huge demand and business potential in trading of Roasted Areca Nuts for various uses but mainly for sale as uses as sprinkled on the Paan as “pukki supari” or “bhuni Supari” or roasted Areca nut (hereinafter referred to as the Product under consideration or PUC) The raw betel nut obtained is subjected to various processes to produce various products. Depending upon the specific value additions different varieties of betel nut such as API Supari, Chikani Supari, Boiled Supari, Dried Supari, unflavoured Supari, Roasted Supari etc. have their distinct use. The goods in the present application are “Roasted Areca Nuts and Roasted Areca Nuts Cut”/ Split. The applicant states that the cultivation, harvesting and processing of the Roasted Areca Nut has undergone tremendous transformation, such that the involvement of labour and their dependency has reduced, by bringing about mechanization, which invariably increases the efficiency, reduces the wastage, enhances the quality and brings about uniformity in the final product. Further, the preparation time of “roasted Areca Nut” has also drastically reduced, in comparison with the manual method of preparation. The controlled roasting of the dried areca nuts causes major irreversible chemical changes in the dried areca nuts. Such changes occurring after the roasting of dried betel nuts result in a peculiar combination of cooked taste which is different than the raw dried betel nuts. It is further reported in Austin Journal of Nutrition and Food Sciences under the heading “Estimation of the major constituents of Areca nut in its Different Forms” Published in volume VIII — issue 1-2019 the chemical composition of Roasted Areca nut may be seen on entirely different from other forms.
2.2 The raw/fresh areca nut undergoes various process of preparation for roasting, which are detailed below:
a. DE-HUSKING: The raw areca nut is de-husked and its outer shell is removed. The de- husked nut is scattered to check and clean any visible impurities. Then the raw de-husked areca nut/betel nut is left to dry.
b. SUN DRYING- Generally, betel nut fruit is dried with sunlight around 3 weeks to reduce the moisture content. The dried betel nut fruit is sometimes cut, as per orders, to easy separate kernel and husk. This brings moisture to the tune of 1215%. Dried kernel is stored in gunny bags.
c. ROASTING — The arecanut / Betel Nut fed in a horizontal axis rotating chamber /clin/oven along with clean sand and then the oven is closed air tight. The oven is in the form of a circular rotating drum bottom of which is heated to around 400600 degrees Celsius flame. The temperature is controlled in such a manner that internal temperature of betel nuts reaches in the range of about 150 degrees Celsius for proper cooking of the betel nut.
d. As the natural dried betel nut varies in moisture, the rustling time is to be controlled accordingly. For fear of overcooking and burn Out batch, the product, is frequently taken out for testing and cooled in water at room temperature and then air dried for 24 hours. Often undercooked batches are taken out and re roasted for desired results of taste and aroma.
e. The cooked and roasted betel nut undergoes a change in its appearance as well as chemical characteristics on account of the repeated roasting process. Lastly the areca nuts are removed from the roasting oven and allowed to cool at normal room temperature, with the assistance of the cooling fans.
f. when the areca nuts have cooled and attained normal room temperature, if found undercooked, they are again fed back into the oven at enormous heat, so as to evenly roast the areca nut. This process is performed repeatedly, until the water content is reduced to 5 -6%. Thereby, the areca nut shrinks and becomes brittle with change in colour. The process of repeatedly heating, roasting and cooling the areca nuts is to ensure that it is of desired roasted standards. This also results in a change of flavour.
g. There is a substantial change in the chemical characteristics of the betel nut/ Arecanut product on account of the roasting process. It has been established through research that the tannin and arecoline content of raw betel nut/ areca nut gets substantially changed by subjecting the same to roasting. Therefore, roasted betel nut is a distinctive product of betel nut making it suitable for immediate consumption.
h. Roasting is not aimed at additional preservation or stabilization or to improve or maintain their appearance of areca nut.
i. The article titled Estimation of arecoline content of various forms of areca nut preparations by high-pressure thin-layer chromatography” throws light on the chemical composition of various forms of areca nuts. As per the article, Polyphenols (flavanols, tannins) constitute a large proportion of the dry weight of the nut. Its content in areca nut may vary depending on the degree of maturity and its processing method. As per the report the tannin content is highest in unripe areca nuts and decreases significantly with increasing maturity. The roasted nut possesses the highest average content of tannins, ranging from 5 to 41% (mean, 1.4%); the average tannin content of sun-dried nuts is 25%; and the lowest levels arc seen in boiled nuts, which contain 17%. The article further states that raw graces nut contains the highest concentration of arecoline (1.15 ÷ 0.008) followed by pan masala preparations (0.94 * 0.006). least content in boiled areca nut (0.79 # 0.009), while roasted variety exhibited an intermediate level (0.85 ÷ 0.007).
3. The applicant intends to import “Roasted Areca Nuts / Betel Nuts” from countries such as Vietnam, Cambodia, Thailand, Myanmar, Sri Lanka etc. into India. Since the process of “Roasting” is not specifically defined in the Indian Customs Tariff Act nor in the 1-ISN explanatory notes or in its Chapter Notes, clarification is being sought from this Advance Ruling Authority.
The applicants submit that Section -II (Chapter 6 to Chapter 14) of Schedule -1 covers VEGETABLE PRODUCTS. The vegetable products of Section II, subject to applicable section and chapter notes, are raw vegetable products (preserved or otherwise
