Importers must fully disclose product composition to avoid penalties and reclassification, which is justified when material facts are suppressed.

Per Mr. VASA SESHAGIRI RAO

These appeals arise out of Order-in-Original and Orders-in-Appeal passed against M/s. Grobest Feeds Corporation (India) Pvt. Ltd. and M/s. Rohit Extraction (P) Ltd., (hereinafter referred to as ‘Appellants’) wherein the imported goods described as “Squid Liver Powder / Squid Meal Powder” were reclassified from CTH 2301 to CTH 2309 90 90, resulting in demand of differential customs duty, interest and imposition of penalties.

2.1 Since the facts, issues, tariff entries involved, grounds of appeal, and legal contentions are common and interlinked, all the appeals as Tabulated below are taken up together and disposed of by this common order.

2.2 The appellants imported Squid Liver Powder from suppliers in the Republic of Korea, claiming classification under CTH 2301 20, being fish/mollusc meal unfit for human consumption, and availed concessional rate of Basic Customs Duty and exemption from CVD. The consignments were cleared under RMS.

2.3 The dispute arose from post-clearance departmental verification of supplier product literature, certificates of analysis and trade information and it emerged that the imported product consisted of squid liver paste mixed with substantial quantities of soyabean meal (about 40–50%), making the product a formulated animal/fish feed, which revealed undisclosed material facts regarding the composition of the imported goods, leading to issuance of Show Cause Notices under Section 28 of the Customs Act , proposing reclassification under CTH 2309 90 90, recovery of differential duty, confiscation and penalties. The adjudicating authorities confirmed the proposals, which were upheld by the Commissioner (Appeals), leading to the present appeals.

3. The Ld. Advocate Mr. M. Karthikeyan, contends that Squid Liver Powder is essentially a product of molluscs, unfit for human consumption, squarely falling under Heading 2301. They argued that the addition of soyabean meal does not change the essential character of imported squid powder. Reliance was placed on certificates issued by the Ministry of Food, Agriculture, Forestry and Fisheries of Korea, certifying the goods as animal products and squid liver powder. The appellants also plead bona fide belief, past clearances and absence of suppression.

4. The Ld. Authorized Representative Mr. Anoop Singh supported the findings of the impugned orders and further submitted that Heading 2301 covers only meals obtained by processing animals or animal products as such, and not compounded or formulated mixtures. The goods in question admittedly contain substantial quantities of soyabean meal, a vegetable-origin protein source, making them preparations of a kind used in animal feeding under Heading 2309. The Korean certificates are descriptive and regulatory in nature and cannot override tariff classification based on composition. Reliance was placed on the decisions of the Chennai Bench of the Tribunal in M/s. Avanti Feeds Limited Versus Commissioner of Customs (Import), Chennai. 2025 (8) TMI 818 - CESTAT CHENNAI, M/s. Avanti Feeds Limited Versus Commissioner of Customs (Import) Custom House, Chennai 2025 (3) TMI 585 - CESTAT CHENNAI, M/s. Avanti Feeds Limited and M/s. Godrej Agrovet Limited Versus Commissioner of Customs (Import), Chennai 2023 (6) TMI 960 - CESTAT CHENNAI where identical products were classified under Heading 2309.

5. We have carefully heard the submissions advanced by both sides, examined the appeal records in detail, considered the statutory provisions, HSN Explanatory notes and the case Laws cited.

6. Upon such comprehensive consideration, the following issues arise for our determination in this appeal as to

i. Whether Squid Powder / Squid Liver Powder imported by the appellants is classifiable under Customs Tariff Heading 2301 or