Case Law Details

Case Name : In re Shreedhra Agro LLP (CCAR Delhi)
Appeal Number : Advance Ruling Nos. CAAR/Del/Shreedhra/07/2022
Date of Judgement/Order : 22/06/2022
Related Assessment Year :
Courts : CAAR

In re Shreedhra Agro LLP (CCAR Delhi)

In the case of Scented & Flavoured and/or Sweetened supari, the question to be answered is whether the addition of special flavoring 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. [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 flavoring agents and marketed in small pouches as NizamPakku (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 07.07.2009] are relevant. Put simply, these decisions clearly imply that addition of flavoring agents do not change the character of the goods, meaning in the present case betel nut would continue to remain betel nut and not become preparation of betel nut.

I have carefully perused the decision of the GST Council regarding classification of scented sweet supari holding the same classifiable under tariff item 2106 90 30. However, the said decision does not detail the reasons for arriving at the same, leaving me handicapped in either distinguishing the same under GST law with classification under the Customs Tariff Act, or consider it adequate and substantive enough to change my previous rulings. Noting that in determining the classification of flavoured supari/betel nut at importation stage, the question should be answered following the Customs Tariff Act and HSN, read with relevant judicial pronouncements.

In view of the above, I rule that ‘Scented & Flavoured and/or Sweetened Betel Nut’ merit classification under Chapter 8, more specifically 0802 80 of the First Schedule to the Customs Tariff Act.

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