2016 (11) TMI 905 - AT - Customs

Classification of imported article - Act II Microwave Popcorn - classified under CTH 20058000 or CTH 2106 90 99 or CTH 20081190 - Held that - the revenue s claim of classification of the product under 2106 seems to be without any basis as the said Chapter Heading 2106 talks about food preparation is not elsewhere specified or included. To our mind the said entry of 2106 is a general residual entry which would cover the classification of the product if it cannot be classified anywhere else. We find that the imported goods are prepared or preserved or used for making of Popcorn. It cannot be disputed that the goods are edible part of the plant. In our view, if it has to be accepted as edible part of the plant, the correct classification would be under Chapter Heading No. 2008. Even the HSM Explanatory notes of Chapter 21 as well as the Customs Tariff in respect of Chapter Heading No. 21, talks primarily about the products which are generally preparation not else were specified or included the Chapter Heading Noe 2106, in our view this would apply in respect of Namkins or other items, which are not classifiable under any other Heading. We also find that evidence from records, that importer appellant is a manufacturer of very same product in India and classified the same on Central Excise Tariff under Heading No. 20081190 and discharging appropriate rate of duty, which has been accepted by the Central Excise department. If the Central Excise department who are accepting the classification of said product under 20.08 and also accepting the duty payment, of the same product, we do not find any reason not to extend the said classification under Customs Tariff to the imported goods. In our considered view, it has to be held that the impugned order is unsustainable and the classification of the imported goods would fall under Chapter Heading No. 20081190. The correct classification of imported goods would fall under Chapter Heading No. 20081190 - appeal allowed.

Summary

Issues:
Classification of imported goods under Customs Tariff Heading, Competing Chapter Headings for classification, Interpretation of HSN Explanatory Note, Dispute resolution regarding classification.

Analysis:
The case involves a dispute over the classification of imported goods, specifically "Act II Microwave Popcorn." The appellant claimed classification under Customs Tariff Heading No. 20058000, while the revenue authorities argued for classification under CTH 2106 90 99. The appellant contended that the goods should be classified under 2008, as they are ready-to-use popcorn mixed with butter. The Departmental Representative, however, argued that the goods are food preparations falling under Chapter Heading no. 2106.

Upon reviewing the submissions and records, the Tribunal considered the competing Chapter Headings. It noted that Chapter Heading 2106 covers food preparations not elsewhere specified, while Chapter Heading 2008 pertains to edible parts of plants prepared or preserved. The Tribunal found the revenue's classification under 2106 to be baseless, as the imported goods are prepared or preserved edible parts of a plant, making Chapter Heading 2008 more appropriate.

The Tribunal highlighted that the HSN Explanatory Note of Chapter 21 supports the classification under 2008 for products like the imported goods. It also pointed out that the appellant, a manufacturer of the same product in India, classified it under Central Excise Tariff Heading 20081190, which was accepted by the Central Excise department. Given this acceptance and consistency, the Tribunal concluded that the imported goods should be classified under Chapter Heading No. 20081190.

Therefore, the Tribunal set aside the impugned order and ruled in favor of the appellant, allowing the appeal and determining the correct classification of the imported goods under Chapter Heading No. 20081190.