The Customs, Excise and Service Taxes Appellate Tribunal (CESTAT), Mumbai, recently held that the ‘liquid seaweed concentrate’ imported by a taxpayer should be classified as a fertiliser and not as a plant growth regulator, in view of its chemical composition. The appellant, taxpayer Excel Crop Care Limited, had imported ‘liquid seaweed concentrate (Crop Plus)’ from the US and had filed three writ petitions against it.
The Deputy Commissioner of Customs issued a ruling on 28 January 2020 to uphold the reclassification, confirm the accrual of customs duties and interest, and impose a fine. The taxpayer’s appeal to the Commissioner of Customs (by way of appeal) was rejected on 31 March 2022. Dissatisfied with the decision, the taxpayer filed an appeal with the Tribunal.
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A two-judge bench comprising of S.K. Mohanty (Judge Member) and M.M. Parthiban (Technical Member) considered the material and held that the show cause notice dated May 19, 2017, proposed to reclassify the imported goods as “plant growth regulators” under CTI 3808 9340 but did not clearly explain why the original classification under CTI 3101 0099 was incorrect.
The appeal court noted that the analysis report showed that the cargo contained 28% organic matter from seaweed and 9.8% nitrogen, phosphorus and potassium. Since most of the cargo was fertiliser, it could not be considered a plant growth regulator.
CESTAT also referred to a larger court decision that clarified that fertilisers provide nutrients for plant growth, while plant growth regulators affect certain processes in plants.
Based on the chemical analysis and the decision of the Grand Chamber, the Tribunal found that the products in question were fertilisers and not plant growth regulators. The Tribunal found the reclassification and the subsequent petition to be unfounded and quashed the contested decision.
Sneha Sukumaran Mullakkal, a Business Administration and Law graduate, has a keen interest in law as it impacts everyday life. She enjoys dancing, singing and painting. She strives to make legal concepts accessible to the common man by skillfully combining analytical thinking with artistic expression in her works.
Post time: Aug-06-2025