2025(05)LCX0184(AAR)

N.C. John & Sons (P) Ltd.

decided on 05-05-2025

Customs Authority for Advance Rulings 

New Custom House, Ballard Estate, Mumbai - 400 001

E-MAIL: cus-advrulings.mum@gov.in

N.B.:

1. A copy of this order made under sub-section (2) of Section 28-1 of the Customs Act, 1962 is granted to the concerned free of charge.

2. Any appeal against this Advance Ruling order shall lie before the High Court of concerned jurisdiction, within 60 days from the date of the communication of such ruling or order.

3. The advance ruling pronounced by the Authority under Section 28 -1 shall remain valid for three years or till there is a change in law or facts on the basis of which the advance ruling has been pronounced, whichever is earlier.

4. Where the Authority finds that the advance ruling was obtained by the applicant by fraud or misrepresentation of facts, the same shall be declared void ab initio.

Advance Ruling

M/s. N.C. John & Sons Pvt. Lid. (IEC No.: 1088000703) (hereinafter referred lo as 'the Applicant") filed an application (CAAR-1) for advance ruling in the Office of Secretary. Customs Authority for Advance Ruling (CAAR) Mumbai. The said application was received in the secretariat of the CAAR, Mumbai on 04.11.2024 along with its enclosures in terms of Section 28H(1) of the Customs Act, 1962(hereinafter referred to as the 'Act also'). The Applicant is seeking advance ruling on the issue of classification of Planter Basket with Needle Tufted Coir Liner under CTI 8306 2990 and Moulded Latex Sprayed Needle Felted Coir Fiber Lining under CTI 6307 9099 of the First Schedule of the Customs Tariff Act, 1975.

2. Applicant's Submissions:

The applicant is a prominent exporter of coir mats, mattings, and various textile floor coverings made from natural and man-made textile materials. With growing demand from international markets such as the USA and Europe, the applicant is seeking lo export a specific product—Iron Planter Basket with Moulded Latex Sprayed Needle Felted Coir Fiber Liner- and also the coir liner alone, used as a replacement insert for such baskets. The registered office of the applicant is located in Alappuzha, Kerala, with its manufacturing unit situated in Tuticorin, Tamil Nadu. The applicant has submitted that the goods will be processed and assembled at the Tuticorin facility and exported through the Tuticorin Seaport.

2.1 The applicant submitted that the subject goods comprised two components—namely, an iron planter basket and Latex sprayed Needle Felt coir fiber sheets. The iron planter basket could either be hung or fixed on balcony railings. It was clarified that the applicant neither manufactured the iron planter baskets nor the coir fiber sheets. Instead, the intention was to procure these items domestically from their respective manufacturers. The applicant proposed to provide the design and size specifications for the iron planter baskets to local manufacturers, who would then produce and supply the goods accordingly. It was indicated that, based on a pro forma invoice or quotation received from a supplier of such baskets, the goods were being classified under Customs Tariff Heading (CTH) 7326 for the purpose of GST. Similarly, the coir fiber sheets were reportedly supplied under CTH 5602. The applicant planned to cut the sheets into desired shapes and sizes using a hydraulic press so they could be fitted into the planter baskets. The applicant intends to source both the iron basket and latex-sprayed coir liner from domestic manufacturers. The iron basket will be fabricated based on custom specifications provided by the applicant and supplied by the manufacturer under CTH 7326. The coir liner, classified by its manufacturer under CTH 5602, will be cut and moulded using a hydraulic press to fit the basket

2.2 It was further submitted that the applicant intended to export these products as a packaged unit. Reference was made to Rule 2(a) of the General Rules for the Interpretation of the Schedule, which provides that a reference to an article in a heading should include that article in its incomplete or unfinished form, provided it retains the essential character of the complete article. This rule also applies lo articles presented unassembled or disassembled.

2.3 The applicant referred to Ruling No. NY N062076 dated 1^st June, 2009 by US Customs, wherein a similar product described as a "Wall Basket with Coconut fiber Liner" was under consideration. The product consisted of a decorative iron wire basket and a 3 mm thick coir liner, semicircular in shape and designed for hanging plants on a wall or railing. The ruling concluded that the appropriate subheading for such garden planters would be 8306.29.0000 of the Harmonized Tariff Schedule of the United Slates (HTSUS), which covers base metal ornaments including statuettes and other decorative items. A copy of the ruling was submitted and marked as Annex-1 for reference.

2.4 Another ruling, NY L86530 dated August 17, 2005, was cited where a similar composite product made of steel wire and coir liner, imported from China, was classified under the same subheading—8306.29.0000. The product in question featured a three-wire, tangle-free hanger. Based on this, the applicant contended that such goods should be similarly classified. The applicant also mentioned receiving inquiries for the supply of Moulded Latex sprayed Needle Felt Coir Baskets alone, as replacement parts for defective ones. In cases where only the coir baskets were exported, the applicant was of the opinion that such goods should fall under CTH 6307.90.99.

2.5 To support this view, the applicant referred to US Customs Ruling No. HQ HI93802 dated July 17, 2015, which dealt with the classification of compsol liners used for tree planting. These liners, which included both rectangular and cone-shaped variants, were designed to hold root balls of trees during transport and planting. The liners decomposed over time, allowing roots to grow through the wire frames they were placed in. The Authority in that case held that such liners were comparable to coir basket and planter liners, and hence classifiable under heading 6307. Additional reference was made to ruling HQ NY K85713 dated May 7, 2004, and NY R02895 dated December 15, 2005, where similar planting bags and root liners were classified under heading 6307 due to their specific use in agriculture, and not under heading 6305 despite some structural similarities. A copy of Ruling No. HQ 11193802 was submitted and marked as Annex-3 for identification.

2.6 Based on the above rulings and functional characteristics of the goods, the applicant submitted that when moulded coir baskets were exported individually, they were most appropriately classified under CTH 6307.90.99. The applicant further submits that the Hon'ble Authority may kindly consider and hold that the composite product, comprising the Iron Planter Basket assembled with the Moulded Latex Sprayed Needle Felted Coir Fiber Lining, is appropriately classifiable under Customs Tariff Heading (CTH) 8306.29.90. It is further submitted that the Moulded Latex Sprayed Needle Felted Coir Fiber Lining, when supplied independently, is rightly classifiable under CTH 6307.90.99. The applicant, therefore, humbly prays that the Hon'ble Authority may be pleased to issue a ruling accordingly and render justice in the matter.

3. Details of Hearing

A hearing was conducted on 24.03.2025 at 11:00 AM. Shri M. Balagopal, Advocate/ Authorized Representative (AR), appeared online on behalf of the applicant and reiterated the contentions filed in the application. He submitted that the subject goods, i.e Planter basket with latex spread Needle Felt Coir Fibre Liner merits classification under CTH 8306 2990 and the Fiber Liner under CTI 6307 9099. He relied upon case laws, US Ruling no. NY N062076, NY L86530. Nobody appeared for personal hearing from Department side.

DISCUSSION AND FINDINGS

4.1 I have considered all the materials placed before me in respect of the subject goods. I have gone through the submissions made by the applicant during the hearing. Therefore, I proceed to pronounce a ruling on the basis of information available on record as well as existing legal framework.

4.2 Before deciding on the issue, let me deliberate on the legal framework prescribed in Customs Tariff Act, 1975, Chapter/ Section notes along with HSN explanatory notes. Classification of imported goods is governed by the principles set forth in the General Rules of Interpretation (GIR). The General Rules of Interpretation (GIR), along with Chapter Notes, Section Notes, and HSN Explanatory Notes, guide the proper classification of imported goods based on their nature, function, and composition.

Classification of goods in the Nomenclature shall he governed by the following principles :

1. The titles of Sections, Chapters and sub-Chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require, according to the following provisions :

2. (a) Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as presented, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also be taken to include a reference lo that article complete or finished (or falling to be classified as complete or finished by virtue of this Rule), presented unassembled or disassembled.

(b) Any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combinations of that material or substance with other materials or substances. Any reference lo goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classification of goods consisting of more than one material or substance shall be according to the principles of Rule 3.

3. When by application of Rule 2 (b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows :

(a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.

(b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference lo 3 (a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.

(c) When goods cannot be classified by reference to 3 (a) or 3 (h), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.

4. Goods which cannot be classified in accordance with the above Rules shall be classified under the heading appropriate to the goods lo which they are most akin.

5. In addition to the foregoing provisions, the following Rules shall apply in respect of the goods referred lo therein :

(a) Camera cases, musical instrument cases, gun cases, drawing instrument cases, necklace cases and similar containers, specially shaped Or fitted to contain a specific article or set of articles, suitable for long-term use and presented with the articles for which they are intended, shall be classified with such articles when of a kind normally sold therewith. This Rule does not, however, apply to containers which give the whole its essential character;

(b) Subject to the provisions of Rule 5 (a) above, packing materials and packing containers presented with the goods therein shall be classified with the goods if they are of a kind normally used for packing such goods. However, this provision is not binding when such packing materials or packing containers are clearly suitable for repetitive use. 6. For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related Subheading Notes and, mutatis mutandis, to the above Rules, on the understanding that only subheadings at (he same level are comparable. For the purposes of this Rule the relative Section and Chapter Notes also apply, unless the context otherwise requires.

4.3 The applicant submitted that the subject goods consist of two main components: an iron planter basket and a moulded liner made from Latex-sprayed Needle Felted Coir Fiber sheets. These items are not manufactured by the applicant but are to be sourced domestically from separate suppliers. The iron baskets, made to the applicant's specifications, arc classified under CTH 7326 for GST purposes, while the coir liners, supplied in sheet form and cut to shape using a hydraulic press, are classified under CTH 5602. The applicant intends to export the assembled baskets with liners as packaged composite units. Citing Rule 2(a) of the General Rules for Interpretation (GIR), the applicant argues that the goods retain the essential character of a complete article and qualify as a composite product.

4.4 GIR 2(a) provides that:

"Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as presented, it has the essential character of the complete or finished article. It shall also include a reference to that article presented unassembled or disassembled. "

This rule is relevant only when the goods are either:

• Incomplete or unfinished, but have the essential character of the finished article, or
   

• Presented in an unassembled or disassembled form.

In the applicant's case, the goods arc presented in a fully assembled and complete form—a finished iron planter basket with a fitted coir liner. Hence, GIR 2(a) is not triggered, because the product is not incomplete or unassembled.

GIR 3(b) states:

"Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale... shall be classified as if they consisted of the material or component which gives them their essential character. "

The product here is a composite good consisting of:

• A metal planter basket, and
   

• A coir fiber liner.

4.5 GIR 3(b) is specifically intended for such combinations of components or materials. It requires classification based on the component that imparts the essential character. In this ease, the iron basket provides the structure, form, and decorative appeal, and thus imparts the essential character of the final product.

4.6 In view of the above facts I find that GIR 2(a) is not applicable because the product is complete and assembled. However, GIR 3(b) is applicable and controlling because the product is a composite good, and classification must be determined based on the essential character, which is imparted by the iron component.

4.7 The product in question—a composite article consisting of an iron planter basket lilted with a moulded coir liner—is evaluated through the lens of this framework. Under Section XV of the Customs Tariff, which pertains to base metals and articles thereof. Note 2(a) expressly excludes "parts of general use" unless such parts arc clearly identifliable as components of a specific article. In this context, it is important to note that the iron basket under consideration is not a generic bracket, fitting, or hardware item. Rather, it is a standalone, finished article with a clear ornamental and utilitarian function—specifically, for holding and displaying potted plants in household or garden settings.

4.8 I leading 8306 of the Customs Tariff specifically encompasses "statuettes and other ornaments of base metal," including decorative containers and garden accessories. The corresponding HSN Explanatory Notes under heading 8306 confirm that decorative articles of base metal—including those incorporating subordinate non-metallic components -are covered under this heading, provided their essential character remains ornamental and is primarily derived from the base metal clement. In this ease, the iron planter basket imparts the structural integrity, decorative appeal, and dominant material character to the final assembled product. Accordingly, under GIR Rule 3(b), which provides that composite goods shall be classified based on the component which imparts the essential character, the product merits classification under heading 8306.

4.9 In support. U.S. Customs Rulings NY N062076 (2009) and NY 1.86530 (2005) were cited, both classifying similar coir-lined decorative metal planters under HTSUS 8306.29.0000, which covers ornaments of base metal, for cases where coir liners are exported separately as replacement parts, the applicant proposed classification under CTH 6307.90.99. Reference was made to U.S. Customs Ruling HQ 11193802 (2015). which held that shaped, biodegradable coir liners for tree planting, due to their processing and function, were classifiable under heading 6307. Similar rulings, including HQ NY K85713 and NY R02895, were also submitted in support.

4.10 The classification of the subject goods has been undertaken in accordance with the General Rules for the Interpretation of the Schedule (GIR) appended to the First Schedule of the Customs Tariff Act, 1975. These rules, together with the relevant Section Notes, Chapter Notes, and the Harmonized System of Nomenclature (HSN) Explanatory Notes, serve as the foundational legal framework for determining the appropriate classification of goods under the Customs Tariff. In the present case, the product in question—a composite article consisting of an iron planter basket fitted with a moulded coir liner— is evaluated through the lens of this framework. Under Section XV of the Customs Tariff, which pertains to base metals and articles thereof, Note 2(a) expressly excludes "parts of general use" unless such parts arc clearly identifiable as components of a specific article. In this context, it is important to note that the iron basket under consideration is not a generic bracket, fitting, or hardware item. Rather, it is a standalone, finished article with a clear ornamental and utilitarian function— specifically, for holding and displaying potted plants in household or garden settings.

4.11 Heading 8306 of the Customs Tariff specifically encompasses "statuettes and other ornaments of base metal," including decorative containers and garden accessories. The corresponding HSN Explanatory Notes under heading 8306 confirm that decorative articles of base metal—including those incorporating subordinate non-metallic components- -arc covered under this heading, provided their essential character remains ornamental and is primarily derived from the base metal element. In this case, the iron planter basket imparts the structural integrity, decorative appeal, and dominant material character to the final assembled product. Accordingly, under GIR Rule 3(b), which provides that composite goods shall be classified based on the component which imparts the essential character, the product Iron Planter Basket with Moulded Coir Liner, as a composite decorative unit whose essential character merits classification under heading 8306.

4.12 The cross rulings cited by the applicant also support the classification under 8306 29 00 emphasizing that the wall mounted iron planter, despite the presence of a coir insert, retained its essential character from the iron structure and decorative function.

4.13 In view of the above facts I find that a composite article consisting of an iron planter basket with a moulded coir liner is examined under I leading 8306, which covers "statuettes and other ornaments of base metal." According to the HSN Explanatory Notes to 1 leading 8306. this heading includes decorative articles made primarily of base metal, whether or not incorporating subsidiary non-metallic components, as long as the essential character of the product is ornamental and derived from the base metal.

4.14 Second, applying GIR 3(b), which governs the classification of composite goods made up of different materials or components, the product must be classified according to the component that imparts the essential character. In this case, the iron planter basket gives the article its structural form, ornamental appeal, and dominant material identity. The coir liner, while functional, plays a subordinate role both in terms of visual prominence and material contribution. Therefore, the essential character of the composite article is clearly imparted by the base metal component.

4.15 Heading 8306 further breaks down into Subheading 8306.29. which includes "Other ornaments and decorative articles of base metal, other than statuettes." Within this, Tariff Item -8-3;Q6.29.90 covers "Other" articles not specified elsewhere. Since the iron planter basket with coir Liner is a decorative, non-statuette article made primarily of base metal and not specifically covered under other subheadings, I find that the appropriate classification is CTH 8306.29.90.

4.16 The Supreme Court's decision in Kemrock Industries & Exports Ltd. v. CC 'E, Vadodara [2007 (210) E.L.T. 497 (S.C.)] affirms that, under Rule 3(b) of the General Rules for the Interpretation of the Tariff, composite goods must be classified according to the component that imparts their essential character. In that case, fibre glass mats stiffened with resin were held classifiable under Chapter 39, as the resin conferred the stiffness and primary function of the final product. Applying this principle, the Iron Planter Basket with Moulded Coir Liner is classifiable under I leading 8306.29.90, as the iron component provides the structural integrity and ornamental identity, thereby imparting the essential character of the composite article.

4.17 Furthermore, in cases where the coir liner is exported independently, its classification has to be considered separately. The liner, being a latex-sprayed, needle-felted article shaped by hydraulic pressing, has undergone sufficient processing to be considered a "made-up article" under Section XI, Note 7 of the Customs Tariff. The relevant HSN Explanatory Notes to heading 6307 describe this heading as a residual category encompassing miscellaneous made-up textile articles, including molded and shaped liners for planters. The cross rulings cited by the applicant, are relevant and applicable in the present case. In Ruling HQ 961 111, it was held that coir needlefelt materials, once shaped into round planter liners, no longer remain classifiable under Heading 5602 as nonwoven textiles but migrate to Heading 6307. as they undergo sufficient processing to become functional, made-up articles. Likewise, in Ruling HQ H193802. coir-based liners and textile sacks were classified under subheading 6307.90. based on their specific shaping, stitching, and intended horticultural use. These rulings confirm that such transformation into finished, application-specific forms aligns with the criteria for classification under I leading 6307 and are directly applicable to the subject coir liners in the present case.

4.18 Therefore. I find that when the coir liner is presented for export as a standalone replacement part, its classification must be determined based on the specific processing it has undergone and its functional characteristics. Section XI of the Customs Tariff, which covers textiles and textile articles. As per Note 7 to Section XI, "made-up articles" include goods that have been cut to shape, moulded, or otherwise assembled into a functional form. In this case, the coir liner, manufactured from Latex-sprayed Needle Pelted Coir fiber sheets and shaped using a hydraulic press, meets the criteria for a made-up article, as it is processed into a defined, usable form intended to function as a planter liner. The coir fiber has been shaped and treated (molded and latex-sprayed) into a finished liner, so it is no longer simply a loose fiber or felt — it has undergone a functional transformation into a specific form. It is no longer in raw or intermediate form but has been transformed into a finished product designed for a specific use in horticulture.

4.19 Since the liner is not specifically covered under any other heading for garments, home textiles, or technical textiles, its classification falls within I leading 6307. which serves as a residual heading for miscellaneous made-up textile articles. The Explanatory Notes to Heading 6307 reinforce this position by including articles that, though not named elsewhere, arc shaped and intended for specific uses, such as horticultural liners. Within this heading, subheading 6307.90 covers "other" made-up textile articles not specifically enumerated. Further, at the eight-digit level, tariff item 6307.90.99 captures all other such articles not falling under the remaining sub-items. Accordingly, I find that the standalone coir liner, when presented independently for export as a functional made-up textile article, is correctly classifiable under CTH 6307.90.99.

5. In view of the foregoing analysis I find that

• The Iron Planter Basket with Moulded Coir Liner, as a composite decorative unit whose essential character is derived from base metal, is classifiable under

CTH 8306.29.90 ("Other articles of base metal, other").

• The Coir Liner, when exported independently as a hydraulically moulded, latex-sprayed needle-felted insert, is classifiable under CTH 6307.90.99 ("Other made-up articles of textiles, other*).

6. I rule accordingly.

(Prabhat K Rameshwaram)
Customs Authority for Advance Rulings.
Mumbai                

 
F. No. CAAR/CUS/APPL/142/2024-O/o Commr-CAAR-Mumbai         Dated: 05-05-2025

This copy is certified to be a true copy of the ruling and is sent to:

1. M/s N.C. John & Sons Pvt. Ltd
XVI/268, Vazhicherry, Alappuzha, Kerala 688 001
Email: jc@ncjohn.com

2. The Commissioner of Customs,
Customs House, Harbour Estate,
Tuticorin, Tamilnadu 628 004
Email: commr-custuticorin@nic.in

3. The Customs Authority for Advance Rulings,
Room No. 24, New Customs House,
Near IGI Airport, New Delhi-110037.
Email: cus-advrulings.del@gov.in

4. The Chief Commissioner of Customs,
Mumbai Customs Zone-I, Ballard Estate,
Mumbai -400001.
Email: ccu-cusmum1@nic.in

5. The Commissioner (Legal), CBIC Offices,
Legal/CX.8A, Cell, 5^th floor, Hudco Vishala Building,
C-Wing, Bhikaji Cama Place, R. K. Puram, New Delhi - 110066.
Email: commr.legal-cbec@nic.in

6. The Member (Customs), Central Boards of Indirect Taxes & Customs,
North Block, New Delhi-110001.
Email: mem.cus-cbec@nic.in

7. The Webmaster, Central Boards of Indirect Taxes & Customs.
Email: webmaster.cbec@icegate.gov.in,
webmaster.cbic@icegate.gov.in

8. Guard file.

(Vivek Dwivedi)       
Dy. Commissioner & Secretary
Customs Authority for Advance Rulings,
Mumbai