The classification of imported areca nuts as roasted or raw depends on moisture content, with below 10% indicating roasted nuts, as per the Authority for Advance Rulings.

JUDGMENT :

K.R. SHRIRAM, C.J.

1. By consent, the appeals were taken up for hearing at the admission stage.

2. Appellant revenue is impugning an order pronounced on 22^nd November, 2024, by which, a learned Single Judge was pleased to quash the orders-in-original dated 22^nd July, 2024 passed by the Additional Commissioner of Customs, Group-1, second appellant herein.

3. As the facts are almost identical, save and except the variance in the Bill of Entry numbers and quantity of goods imported and as what is impugned is a common order and judgment, we decide to dispose these appeals by this common judgment.

4. Respondents had imported goods, which were declared as roasted areca nuts, from Indonesia. According to respondents, these goods would fall under Chapter 20 of Tariff 2008 1920 and were declared as such.

5. According to appellant revenue, what is imported was raw areca nuts, which would fall under Chapter 8 of Tariff 0802 80. Both areca nuts, whether raw or roasted, are not prohibited goods and can be imported. For the importation of raw areca nuts, a minimum price is fixed at Rs.351/- per kg., whereas no such minimum price was fixed for roasted areca nuts.

6. Respondent importers filed applications before the Customs Authority for Advance Rulings in terms of Section 28H of the Customs Act, 1962. Applications seeking advance rulings were made on the classification of roasted areca nuts (whole/cut/split), which the party intended to import.

7. In the case of Neena Enterprises, a ruling was given on 1^st March, 2023, in which paragraph 6.17 reads as under:

“6.17 Among many objections I find one observation of the jurisdictional Customs Commissionerate quite important. The applicant's claim that after repeated roasting for 2-3 days under 130- 150 degrees Celsius in a roasting oven due to which the water content is reduced to 10-15% is a complete misrepresentation of facts. Jurisdictional Commissionerate has stated that it is evident by the fact available with this office vide (based on) test reports that a raw betel nut falling under Chapter 8 has a moisture content of less than 10% and the betel nut undergoing repeated roasting and severe heat treatment has a water content 10 to 15% appears incorrect. I agree with this observation of the Commissionerate. As mentioned earlier, actual samples of the imported goods can be drawn and tested for ascertaining the actual moisture content by the jurisdictional Customs Commissionerate at the time of Customs Compliance Verification (CCV) of the imported goods before clearance (Out of Charge (OOC) is granted to ensure that the goods are conforming to what is declared in the import documents. I also do not agree with the comment of the jurisdictional commissionerate that there was any misrepresentation of facts or non-observance of due process. Applicant has a right to present its case during the course of personal hearing. Veracity of applicant's claim related to issues like moisture content can be very well examined by the jurisdictional Customs Commissionerate at the time of actual import by drawing and testing of the samples of imported goods from the concerned agency.”

8. In the case of Universal Impex, a ruling dated 12^th May, 2023 was given, where paragraph 4.17 reads as under:

“4.17 I have perused a test report issued by ABC Techno Labs India Pvt. Ltd., Chennai dated 31.3.2023 on the samples of roasted areca nut whole & split in which the test result indicates the moisture content, a test parameter, of the samples in the range of 3.34% to 3.84%. Moisture content in raw areca nut is found to be generally in the rage on 10-15%. As per applicant this test report indicates that the products were subjected to the roasting process. This aspect of product testing is a part of Customs Compliance Verification (CCV) process on importation of goods. Jurisdictional Customs Commissionerate carry out process of testing of imported goods with the help of concerned government partner agencies (GPAs) to cross-