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2024 (11) TMI 1088 - HC - CustomsImport of Roasted areca nuts from Indonesia - Classification of imported areca nuts are roasted or raw. - As per the Advanced Ruling Authority, if the moisture content of the areca nuts is between the range of 10% and 15%, it would be considered as raw areca nuts , whereas, if the moisture content is below 10%, it would be considered as roasted areca nut - HELD THAT - As per the answers received from the Farmers, who are cultivating the betel nuts (areca nuts) and doing the process of roasting the same, it appears that if the areca nuts are not dried (fruits before peeling) or roasted (after peeling), the same will get affected with fungus. Further, it was informed by the farmers that once the raw areca nuts (before its ripening stage) are peeled out and kept for more than a week, the same will get spoiled and will not become viable to sell it commercially. Hence, in the case of raw areca nuts , it is clear that the same cannot be imported unless and otherwise it is boiled or roasted . In this case, the Lab reports had made it clear that the said Labs have witnessed the burning smell while testing the imported areca nuts, which ultimately proves that the said imported areca nuts are roasted . In this case, though the goods were imported an year ago, still it had not lost its originality and it is in good condition, which ultimately shows that the imported goods are roasted areca nuts . Thus, this Court is of the considered view that as per the parameters determined by the Advance Ruling Authorities and taking into consideration of other aspects as discussed above, the areca nuts, imported by the petitioners, will squarely fall within the parameters of roasted areca nuts . The respondent had failed to consider the aspects, which were discussed above, and passed the order-in-original without even considering the order passed by this Court in M/S. SHAHNAZ COMMODITIES INTERNATIONAL P. LTD., M/S. NEENA ENTERPRISES, M/S. UNIVERSAL IMPEX 2023 (8) TMI 492 - MADRAS HIGH COURT whereby the order of the Advance Ruling Authorities was confirmed. Therefore, the impugned order passed by the respondent is liable to be set aside. Accordingly, the impugned order passed by the respondents is set aside. In view of the above, this Court directs the respondents to release the areca nuts, imported by the petitioner, within a period of 2 working days from the date of receipt of copy of this order. Further, since the fault is purely on the part of the respondents, they shall release the goods without any demurrage charges. In this regard, the respondents are directed to issue a detailed certificate for waiver of demurrage and container charges.
Issues Involved:
1. Classification of imported areca nuts as "roasted" or "raw." 2. Competency of the Court to adjudicate the classification issue when an alternate remedy is available. Detailed Analysis: Issue 1: Classification of Imported Areca Nuts The core issue involves determining whether the imported areca nuts are "roasted" or "raw." The petitioners imported areca nuts from Indonesia, declaring them as "roasted areca nuts." The classification affects the applicable tariff, with "raw areca nuts" falling under Chapter 8 of Tariff 0802 80 and "roasted areca nuts" under Chapter 20 of Tariff 2008 1920. The petitioners argued that the moisture content of the nuts, as determined by multiple laboratory tests, was below 10%, classifying them as "roasted areca nuts" according to the parameters set by the Advance Ruling Authorities. These parameters were confirmed by the Division Bench of the Court and not challenged further, thus attaining finality. The respondents, however, argued that the nuts were mis-declared and should be classified as "raw areca nuts," subject to a higher import duty. They cited variations in moisture content reports and claimed the nuts were only "moderately heat treated." The Court observed that there is no precise definition of "roasted areca nuts" in the Customs Act or Tariff. However, the Advance Ruling Authorities' parameters, which classify nuts with moisture content below 10% as "roasted," were upheld by the Division Bench and should be followed. The Court noted that the respondents failed to provide any scientific basis or alternative parameters for their classification and ignored the established parameters without justification. Issue 2: Competency of the Court The respondents contended that the issue of classification is a factual matter best adjudicated by the appropriate authorities and not by the Court, especially when an alternate remedy of appeal is available. The Court, however, found that the respondents failed to consider the Advance Ruling Authorities' parameters and the Division Bench's decision, which justified the Court's intervention despite the availability of alternate remedies. The Court emphasized that both "raw" and "roasted" areca nuts can be imported, with the primary difference being the applicable duty. The Court concluded that the imported nuts met the parameters for "roasted areca nuts" and directed the release of the goods without demurrage charges, citing the respondents' failure to adhere to established legal standards. Conclusion: The Court set aside the impugned order, directing the release of the areca nuts within two working days without demurrage charges. It highlighted the need for legislative clarity on the minimum support price for "roasted areca nuts" to prevent similar disputes in the future. The petitions were allowed, emphasizing the importance of adhering to established legal parameters and judicial decisions.
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