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TMI Blog2024 (4) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacture to supply . The Supplementary Note 2 in Chapter 21 of CGST Tariff is also verbatim the same as Supplementary Note 2 under Chapter 21 of the Customs Tariff Act, 1975. This only exemplifies the intention of the legislature to have always treated supari as a special entry and not as a betel nut under the general entry of nuts . There are force in the submission of the Learned Counsel for the Appellant that the Customs Tariff Act still continues to employ the same phraseology that was available under the unamended Central Excise Tariff Act and that too when the Apex Court had dealt with the same issue, the ratio laid down by the Apex Court in CRANE BETEL NUT POWDER WORKS VERSUS COMMR. OF CUS. C. EX., TIRUPATHI [ 2007 (3) TMI 6 - SUPREME COURT] case would still hold the field and apply to the case on hand, it cannot be accepted that the said limb of argument, in view of our categorical finding that there being a specific entry for Supari under Chapter 21 and it would take precedence over the general entry under Chapter 8, the question of applying the ratio laid down by the Apex Court would not even arise for the simple reason that the issue on hand is only revolving around cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 24.02.2023 held that the product would have to be classified under Chapter 21 of the Customs Act, 1962. At this juncture, it would also be relevant to note that none of the Customs authorities who were put on notice chose to appear before the CAAR and oppose the advance ruling application filed by the respondents. 4. We have heard Mr. N.Dilip Kumar, Senior Standing Counsel for Customs, CGST & Excise for the Appellant Department and Senior Counsel, Mr.Vijay Narayan, for Mr.T.Balakrishnan, Counsel for the respondents. We have paid our anxious and careful consideration to the rival submissions advanced on either side, apart from also perusing the material records, including the impugned advance ruling of CAAR. We have also kept in mind the various principles laid down by the Courts that have been brought to our notice by the Counsel on either side, by referring to several judicial pronouncements. We have also taken note of the written submissions that have been filed by both the Counsel for the Appellant as well as the respondents. 5. Mr.N.Dilip Kumar, learned counsel for the appellant would develop his arguments, challenging the advance ruling, by first and foremost contendin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore, areca nuts, whether or not flavoured with menthol, would have to be necessarily classified only under Chapter 8 and the learned counsel would contend that in order to qualify for being classified under Chapter 21, the imported product should be a preparation containing betel nuts and it should not have lost the character of areca nut. 9. The learned counsel for the appellant would therefore primarily focus on the point that 'Menthol Scented Supari' contains the flavour of menthol and does not amount to a food preparation as mentioned in Note 2 to Chapter 21 and when areca nut is edible by itself and even if it is cut, boiled, sweetened, it would not change the character of the betel nut and the process of sweetening it would not amount to manufacture, in order to have it classified under Chapter 21. On the other hand, even if the betel nut is boiled and undergoes moderate heat treatment and also by adding of glucose syrup, oils etc., it would not be a reason to take it out of the purview of Chapter 8. 10. The learned counsel for the appellant would also invite our specific attention to the decision of the Apex Court in Crane Betel Nut Powder Works v. Commissioner of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt held that in order to be eligible for being classified under Chapter 21, there would have to be, necessarily, a preparation containing betel nuts and in the absence of such a preparation, the product would have to be classified only under Chapter 8. ii) Shreedhra Agro LLP reported in (2022) 382 ELT 416 (AAR) which was also confirmed by the Division Bench of the Delhi High Court, in CUSAA.130 of 2022, holding that the process of scenting or flavouring betel nut would not render it a preparation of betel nuts, resulting in classification being made under Chapter 21. He would also refer to the discussion of the Advance Ruling Authority in the said case about the effect of GST circulars classifying it under Chapter 21 and holding that it would not bind the Customs Authority, who would be at liberty, to still classify it under Chapter 8. iii) M/s.Global Impex v. Commissioner of Customs in Final Order No.51407 - 51408 of 2023 dated 09.10.2023, where the Tribunal held that the imported scented goods, viz., scented sweet suprai was neither a product of betel nut nor a preparation of betel nut, but only betel nuts cut into pieces and would be classifiable only under Chapter 8, bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commodities International P. Ltd. and 2 others, rendered in CMA Nos.600, 1206 and 1750 of 2023, where a Division Bench of this Court, in and by a Common Judgment dated 01.08.2023, held that when there is a specific clause under Chapter 20, the classification cannot be made under Chapter 8. 19. At the outset, before we proceed to decide the moot point as to the correct classification of 'Menthol Scented Supari', we may refer to some of the relevant statutory provisions and supplementary notes. 20. Chapter 08 (02) deal with 'other nuts, fresh or dried, whether or not shelled or peeled.' Chapter Note 3 to Chapter 8 reads thus: "3. Dried fruit or dried nuts of this Chapter may be partially rehydrated, or treated for the following purposes: (a) For additional preservation or stabilization (for example, by moderate heat treatment, sulphuring, or the addition of sorbic acid or potassium sorbate); (b) To improve or maintain their appearance (for example, by the addition of vegetable oil or small quantities of glucose syrup), provided that they retain the character of dried fruit or dried nuts." Chapter 21 (06) deals with 'Food preparations not elsewhere specified or included'. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the purview of Chapter 8. The further contention of the Learned Counsel for the Appellant is that Chapter 21 is only residuary in character and when Chapter 8 applies to the product in question, the Advance Ruling Authority cannot fall back on Chapter 21 and classify the product under Chapter 21. 22(c). However, we have seen that Supplementary Note 2 specifically deals with 'Supari' and states that it is any preparation containing betel nuts, but not containing lime, katha (catechu) and tobacco, whether or not containing cardamom, copra or menthol. In our view, the said Supplementary Note 2 placed under Chapter 21 would certainly cover the product in question, viz., 'Menthol Scented Supari'. Its is not the case of the Appellant that the product in question contains lime, katha (catechu) or tobacco. Only if any of these 3 ingredients are used, then the betel nut product known as 'Supari' would fall outside the purview of Chapter 21. 22 (d). Thus, reading Chapter 21 as a whole, harmoniously with Supplementary Note 2, it is evident that the legislature has specifically carved out an entry for "Menthol Scented Supari" which contains betel nut pieces, menthol added to it and does no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quantity of glucose syrup, as long as the product retains the character of a dried nut or fruit, it would be classified under Chapter 8. 26(b). However, under Chapter 21 what is contemplated is a preparation containing betel nuts and not containing lime, katha (catechu) or tobacco, whether or not it contains ingredients like cardamom, copra or menthol. 26(c). Thus, there is a fundamental distinction even in the object and purport of both the Chapters. Therefore, applying the General Rules of Interpretation for Import Tariff, there is no difficulty in holding that there being a specific entry for the product in question, viz. "Menthol Scented Supari" under Chapter 21, applying the rules of interpretation, the classification of the said product has to be only under Chapter 21 and not Chapter 8. 27. The CAAR has also specifically referred to the fact that comments were invited from the jurisdictional Principal Commissioner / Commissioner of Customs and that comments were received from the jurisdictional authority, Commissioner of Customs (Imports), Mundra which has also been referred to and discussed. It has also specifically recorded that no one represented the department/jurisdic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to Tariff Item 2106 90 30 relating to 'supari' and stating that the process of adding or mixing cardamom, copra, menthol, spices, sweetening agents or any such ingredients other than lime, katha (catechu) or tobacco to betel nut, in any form, shall not amount to "manufacture". However, we are conscious of the fact that this amendment was only under the Central Excise Tariff Act and not the Customs Tariff Act. 32. Secondly, w.e.f. 1.7.2017, the GST Act was introduced and the concept of taxation itself has undergone a change from 'manufacture' to 'supply'. The Supplementary Note 2 in Chapter 21 of CGST Tariff is also verbatim the same as Supplementary Note 2 under Chapter 21 of the Customs Tariff Act, 1975. This only exemplifies the intention of the legislature to have always treated 'supari' as a special entry and not as a betel nut under the general entry of 'nuts'. 33. Though we find force in the submission of the Learned Counsel for the Appellant that the Customs Tariff Act still continues to employ the same phraseology that was available under the unamended Central Excise Tariff Act and that too when the Apex Court had dealt with the same issue, the ratio laid down by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the question of classifying it under Chapter 8 does not even arise, especially when this was neither the issue before the Apex Court nor the basis on which the decision was rendered. It is also trite law that a decision is only an authority for what is decided and it cannot be extended to something which has not been decided by applying the process of a logical deduction. 35 (b). In fact, in P.Rajendran Vs. The Assistant Director, in Crl.O.P. No.19880 of 2022 dated 14.09.2022, the Division Bench of this Court, in fact, one of us being a part of the Bench (Justice. RMT.TEEKAA RAMAN) held that "a case is only an authority for what it decides". As observed by Lord Halsbury in Quinn v. Leathem, reported in 1901 AC 495, quoted hereunder for easy reference: "... that every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law, but are governed and qualified by the particular facts of the case in which such expressions are to be found. The other is that a case is only an authority for what it actually decides." 35 (c). In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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