‘Nimbooz’, Whether To Be Classified As ‘Lemonade’ Or ‘Fruit Pulp Or Fruit Juice Based Drink’: To Be Decided By The Supreme Court

The Hon’ble Supreme Court For the purposes of the Central Excise duty, recently consented to review whether the product ‘Nimbooz’ can be classed under item ‘Lemonade’ and/or as ‘fruit pulp or fruit juice based drinks.’

Justices MR Shah and BV Nagarathna agreed to address the question when issuing notice in the civil appeal against the order of the Customs, Excise, and Service Tax Appellate Tribunal Regional Bench at Hyderabad dated October 1, 2021.

Commissioner of Customs, Central Excise and Service Tax Hyderabad-I and M/S Aradhana Foods filed an appeal against the Commissioner, Customs, Central Excise and Service Tax Hyderabad-I, Commissionerate’s against the ruling passed on March 31, 2015.

M/S Aradhana Food had filed an appeal to overturn the impugned ruling, which confirmed the demand for differential duty on ‘Nimbooz’ for the customary limitation period of April to December 2013. The Department had filed an appeal to have a portion of the Commissioner’s order that withdrew the claim for differential duty for the longer period of limitation set aside.

Nimbooz, according to the appellant, should have been classified under CETH 2022 10 20 of the First Schedule to the Central Excise Tariff Act 1985, whereas the Department believes it should have been classified under CETH 2022 90 20 under the category of “fruit pulp or fruit juice based drinks.”

The issue referred to in para 67 (DOWNLOAD PDF) of the judgement passed by the Larger Bench of the Tribunal in M/s. Brindavan Beverages Private Limited vs. Commissioner Customs, Central Excise and, The Commissioner as well as Aradhana Foods will be decided by a bench of Justices Dilip Gupta and P. Venkata Subba Rao.

Relevant judgement reads as follows:

“Accordingly, the reference is answered as follows: Brindavan Beverages Private Limited’s product “Minute Maid Nimbu Fresh (hereinafter referred to as MMNF) and PepsiCo India Holdings Private Limited’s product 7UP “Nimbooz Masala Soda” or 7UP “Nimbooz” are classifiable under Tariff Item 2202 90 20 of the Central Excise Tariff Schedule under the category of “fruit pulp or fruit based juice”.

The bench, relying on the same, stated in their order, “In light of the aforementioned order of the Tribuanl’s Larger Bench, ‘Nimbooz’ would be classifiable under CETH 2202 10 20 of the Central Excise Tariff Act’s First Schedule.”

The bench went on to say in the order that the question of whether the Department was justified in requesting the extended term of limitation did not arise.

“As a result, the Commissioner’s ruling dated 31.03.2015 confirming the demand for differential duty for the customary period of limitation with interest and penalty cannot be sustained and is set aside.” As a result, Aradhana Foods’ Excise Appeal No. 21624 of 2015 ought to be accepted, and therefore is allowed.

Hence, the court finally observed that, the Excise Appeal No. 21678 of 2015, filed by the Department, is dismissed since the demand for differential duty has been dismissed.”

To Read Judgement Download PDF Given Below: