The Ahmedabad Bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) ruled that the classification of imported goods under the Customs Tariff must be based on the product’s tariff description, Chapter Notes, and Rules of Interpretation, rather than its end use
Arpan Aeromatics, the appellant is a company importing chemicals for use in the fragrance industry. The imported item was Tetramethyldodehydronaphto Furan ( TF ), a pure aromaticchemical marketed under the trade name Ambermor-X ( Ambroxane/Ambroxide ).
The appellant imports Tetramethyldodehydronaphto Furan ( TF ) as a raw material for blending with other odoriferous substances to produce synthetic perfume bases used in industrial fragrances for products like soaps and agarbattis.
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The appellant classified TF under Chapter 29 ( CTH 2932.99 ) as a heterocyclic compound but the department claimed that TF is a synthetic perfumery compound and should be classified under Chapter 33 ( CTH 3302.90.11 ) due to its end use in manufacturing fragrances and industrial flavoring compounds.
The main concern was that Chapter 29 has a lower Basic Customs Duty ( BCD ) but Chapter 33 attracts a higher BCD. Aggrieved, the appellant filed an appeal before the CESTAT arguing that classification should be based on the chemical structure and composition of the product as per the Customs Tariff, not its end use.
The appellant’s counsel argued that Chapter Note 1(b) of Chapter 29 specifically states that mixtures of isomers remain classified under Chapter 29. The appellant’s counsel pointed out that no chemical examination was conducted by the customs authorities to support their claim.
On the other hand, the department’s counsel relied on the lower authorities’ order.
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The two-member bench comprising Ramesh Nair ( Judicial Member ) and Raju ( Technical Member ) noticed that the department determined the classification focused on end-use rather than Customs Tariff description, Chapter Notes, and Rules of Interpretation.
The tribunal explained that Tetramethyldodehydronaphto Furan (TF) being a mixture of isomers falls under Chapter 29 as per Chapter Note 1(b) which specifies that such mixtures remain classifiable as organic chemicals.
The tribunal found no evidence to apply Chapter Note 1(e), as there was no proof that the
product was dissolved in solvents or altered for specific single-use suitability. So, the tribunal ruled that TF should be classified under Chapter 29 of the Customs Tariff Act, 1975
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