Page 200 - GSTL_14th May 2020_Vol 36_Part 2

302 GST LAW TIMES [ Vol. 36
Customs [Tariff] Chapter Heading 2202 demonstrates that Tariff sub-heading
2202 10 covers drinks which are predominantly made up of water, including
mineral water and aerated water and are either sweetened or flavoured or both.
It is submitted by them that Tariff sub-heading 2202 99 covers other non-
alcoholic beverages and the drinks covered under this sub-heading would be
imparted their essential character by another substance.
14.2 As already noted, as per the contents of ‘Fanta Fruity Orange’, the
said product is sweetened (with Sugar and Sweetener) and flavoured (with Or-
ange Juice Concentrate and added Orange flavours - natural and nature-identical
flavouring substances). The same is also aerated as well as presented in PET bot-
tles. As per explanatory notes referred to above, the sub-heading 2202 10 covers
products flavoured with fruit juices or essences or compound extracts. Thus,
‘Fanta Fruity Orange’ flavoured with Orange Juice Concentrate and added Or-
ange flavours would fall under sub-heading 2202 10 in view of the explanatory
notes of HSN.
15.1 The GAAR in its Advance Ruling has referred to the affidavit filed
by Shri Rajesh Nair, Associate Vice President - Quality Assurance & Product In-
tegrity, wherein it is stated that during the process of manufacture of ‘Fanta
Fruity Orange’, Carbon Dioxide equal to 5.148 grams per Litre is added as a pre-
servative only and not for any other purpose. On the basis of this affirmation, it
is held in the Advance Ruling that the product ‘Fanta Fruity Orange’ would not
fall under Tariff sub-heading 2202 10.
15.2 However, we observe that there is nothing in the Customs Tariff or
Explanatory Notes of HSN pertaining to Heading 2202 to suggest that the prod-
uct containing Carbon Dioxide as preservative only would not fall under Tariff
sub-heading 2202 10. On the contrary, Explanatory Notes of HSN for sub-
heading 2202 10 specifically mentions that the products of this sub-heading are
often aerated with carbon dioxide gas. Therefore, the product ‘Fanta Fruity Or-
ange’ is not excludible from sub-heading 2202 10 on the ground that the product
contains Carbon Dioxide as preservative only.
Tariff Item 2202 99 20 :
16. We may now examine the Tariff Item 2202 99 20 which covers ‘Fruit
pulp or fruit juice based drinks’ to see whether the product ‘Fanta Fruity Orange’
can be classified under this Tariff Item as contended by the appellant.
17.1 It is the submission of the appellant that the percentage of reconsti-
tuted Orange juice (out of Orange juice concentrate 1.65) in ‘Fanta Fruity Orange’
is 10.5%. An affidavit of Shri Rajesh Nair, Associate Vice President - Quality As-
surance & Product Integrity of the appellant company and certificates of Dr.
Lambert Rodrigues and Dr. Madhukar Bhotmange to this effect have been sub-
mitted. The appellant has also placed reliance upon D. Hicks (ed.), Production
and Packaging of Non-carbonated Fruit Juices and Fruit Beverages, 1990 and dic-
tionary meanings of the term “base”. On the basis of the fact that the product
contains 10.5% of the orange juice as base and relying on Food Safety and Stand-
ards (Food Products Standards and Food Additives) Regulations, 2011/Food
Safety and Standards (Food Products Standards and Food Additives) Regula-
tions Eleventh Amendment Regulations, 2016, CGST Vadodara-I Commissioner-
ate has opined that the product falls under Tariff Entry 2202 99 90 (sic).
17.2 In this regard, an issue arises whether the definition of another
statute can be applied for determination of classification of product under Cus-
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