S.S. Sekhon, Member (T)
1. Heard Ld. Sr. Advocate for the appellant & the D.R. for Revenue. Considered the matter and it is found:
(a) Issue in classification under the Customs Tariff Act Schedule of entities - ALOE VERA GEL; ALOE VERA BERRY NECTAR ALOE VERA FOREVER FREEDOM. The importers claim the entities to be under Chapter Heading 20.09.80 & 20.09.90 respectively while Revenue classifies the same under 2106.
(b) There are no test reports relied upon by the department. The perusal of the original order reveals the constituents to be as per the imports made -
a. ALOE VERA GEL - A Vegetable Juice - Consisting of the Aloe Vera sap/juice.
b. ALOE VERA NECTAR - a MIXTURE OF Fruit and vegetable Juices
Consisting of the Aloe Vera sap/juice.
Addition of Apple and Cranberry Juices in miniscul quantities as detailed aforesaid.
c. FOREVER FREEDOM - A mixture of Fruit and Vegetable Juices.
Consisting of the Aloe Vera sap/juice.
Addition of Orange Juice in miniscul quantites as detailed aforesaid.
i. Reading of the notes to Chapter 20.09 & 21.06 reveal that juices, un-fermented & not containing spirits obtained generally by processing fresh healthy and ripe vegetables by mechanical means and the liquids obtained then submitted to process of clarification, filtration, de-aeration, homogenization and sterilization would remain in heading 20.09, when such juices should retain their original character but may contain sugars, sweetening agent preservatives and standardising agents or added salt spices or flavouring substances and they can be inter mix of same or of different sources of plants juices. However, if the entity becomes a preparation, often referred to as 'Food Supplements' based on extracts from plants/fruits concentrates etc, basically remaining Non-alcoholic as preparations obtained by COMPOUNDING vegetable extracts of Heading 1302 with various chemicals, e.g. tartaric acid, citric acid etc and result in beverages obtained by simple dilution with water, wine or alcohol for domestic use or use in industry, this being to avoid transport costs but with endorsements on labels of maintenance of general health or well being, but not for prevention or treatment of ailments etc in such cases the preparation would get classified under Heading 2106.
(c) On a question from the Bench the ld. Advocate accepts that the entity is Standardised and Preservatives are added after clarification, filtration etc. of the juice of Aloe Vera Plant but there is no COMPOUNDING done with tartaric acid etc. and the ld. DR admits that there is no test report indicating a Compounding having been established. Both sides agree that the use of these three entitles is not to make any beverage/drink by dilution with water, wine or alcohol in Industry or domestic use. It is also not contested that it is consumed, in small quantities as such, as imported, by human. The classification Aloe Juice therefore has to be upheld under 2009.80 for the unmixed and 2009.90 for the Aloe Juice mixed with cranberry juice and or orange juice when presented for assessment as in this case.
(d) The plea of the ld. Advocate that Aloe Vera is specifically mentioned as vegetable; the crushing of the fleshy leaves of the plant result in the juice is not questioned by the Revenue before us. The term vegetable and vegetable juice will be juice emerging from crushing of a plant part leaf including fleshy leaves of Aloe Vera plant. Saps by definition are self exudates, without damaging the plant cell, while juices would be result of crushing or & tearing activity of the plant cell parts. Botanically called as fruits or other edible parts like leaves, roots etc. Carrot juice will be plant juice from root of carrots crushed. Similarly, Aloe Vera juice would be result of fleshy leaves of Aloe Vera Crushed. The generally understood meaning of vegetable juice will cover juice from any plant part. The findings of lower authorities contrary to this interpretation of vegetable juices cannot be upheld, especially when preparation is not established and juice is not compounded.
(e) The finding of the entities to be 'Food Supplement' cannot be upheld since to be a supplement it has to be basically a protein, fat or carbohydrate or mix of two or more of these to 'Supplement Food'. The entity cannot be proved to be a 'Food Supplement' or recommended in lieu of or in support of nutritional requirements obtained from food. The term 'Food Supplement' cannot be applied to a juice recommended to be taken of 10 to 15 ml in a day by a human. It is not marketed in capsule, tablet or sachet form and food supplements are as per para 16 to Chapter Note would be based on extracts and not crushed plant parts or fleshy leaf only clarified, filtered and standardised. The entity not being 'sap' as understood as exudates of a plant and the finding of fact by the original authority as seen from the order is "These goods are made from Aloe Vera Gel/Saps after processing by addition of other substances. Therefore, these goods are preparations of Aloe Vera Gel/Saps," which would indicate that the authority itself is not sure of the product under assessment to be exclusively a 'sap'. Therefore, the entities here are to be classified relying on para (ii) of the Example of excluded preparation under heading 1302.
(f) There is no material to conclude that vitamin in the entity reported as constituents are added and this disqualified them from classification under 20.09 as held by department cannot be upheld.
(g) Heading 2106 applies to 'Food Preparation'. The Heading 2009 to juice of vegetables and preparation thereof; 'food' is understood & as 'food preparation', as per dictionary or commonly understood meaning of 'food' much less 'food preparation' can not be applied to the entities between Classification as 'food or food preparation' is not called.
(h) The lower authority has dismissed the advisory of WCO for being under Chapter heading 2202.90. The issue of classification under 2202.90 is not being urged before us. Following the Apex Court decisions in the case of Reckitt & Colman of India Ltd v. CCE , Hindustan Polymers Co Ltd v. CCE, Guntiir 1999 (106) E.L.T. 12 (S.C.), and in Warner Hindustan Ltd. v. CCE, Hyderabad , no finding are arrived at above
classification under 2209.
2.1 In view of the finding, between the two disputed entities i.e. 2106.90 or 2009.80 and 2009.90, we would classify the products herein under 2009.80/2009.90 as classified and allow the appeal accordingly.
3.1 Appeal allowed as per the findings herein above.
(Pronounced in Court.)