In Ruling No. CAAR/Mum/ARC/39/2023- AAR - ‘Roasted betel nuts’ fall under Tariff entry 2008 19 20: AAR (Maharashtra)
Member Narendra V. Kulkarni [12-05-2023]

Read Order: In re: M/s. Universal Impex

LE Correspondent

Mumbai, May 18, 2023: The Maharashtra Authority for Advance Rulings has ruled that ‘Roasted betel nuts’ fall under Tariff entry 2008 19 20 of chapter 20 of the first schedule of the Customs Tariff Act, 1975.

M/s. Universal Impex (applicant) had filed applications for advance ruling before the Customs Authority for Advance Rulings, Mumbai. The applicant had sought advance ruling on the classification ‘Roasted Areca Nuts’ that they intended to import from Indonesia into India through the seaports of Mumbai, Chennai and Tuticorin.

The Authority remarked that the dry-roasting, oil-roasting and fat-roasting are not defined in the Customs Tariff Act, 1975, therefore, these terms had to be understood in a commonly accepted sense. By placing reliance on Alladi Venkateswarlu v. Government of Andhra Pradesh [LQ/SC/1978/75], wherein the Supreme Court has held that "the commonly accepted sense of a term should prevail in construing the description of an article of food", the Authority observed that in common trade parlance, ‘drying’ refers to the removal of water content for food preservation, while ‘roasting’ involves subjecting goods to high heat, resulting in significant changes in their structure and appearance, therefore, it was concluded that drying and roasting are distinct processes, with drying focusing on moisture removal and roasting involving severe heat treatment.

“Vegetable, fruit or nut products or preparations made other than by the processes specified in Chapters 7, 8 or 11 are classifiable in Chapter 20,” said the Authority.

The Authority then referred to two Supreme Court cases, namely M/s Amrit Agro Industries Ltd v. Commissioner of Central Excise Ghaziabad [LQ/SC/2007/365] and Commnr. Of Customs & Central Excise, Goa v. M/S. Phil Corporation Ltd [LQ/SC/2008/282], which have upheld the classification of roasted nuts, including roasted betel nut, under Chapter 20 of the Central Excise Tariff Act.

The argument that mere roasting does not amount to ‘preparation’ was deemed legally unsustainable, by the Authority and therefore, the classification of roasted nuts under Chapter 20 of the Customs Tariff Act, 1975 was upheld.