Date: 19981104
Docket: A-47-97
CORAM: DESJARDINS, J.A.
ROBERTSON, J.A.
SEXTON, J.A.
In the matter of the Customs Act,
R.S.C. 1985, c.1(2nd Supp.), as amended
BETWEEN:
NALLEY'S CANADA LIMITED
Appellant
- and -
THE DEPUTY MINISTER OF
NATIONAL REVENUE
Respondent
REASONS FOR JUDGMENT
(Delivered orally from the Bench
at Vancouver, B.C. on November 2, 1998)
DESJARDINS, J.A.
[1] This is an appeal on a question of law from a decision of the Canadian International Trade Tribunal (the "Tribunal") pursuant to section 68 of the Customs Act1. At issue is whether the goods imported by the appellant were properly included under classification No. 2103.20.00.90 of Schedule I to the Customs Tariff2 as "other tomato sauces" or whether they should have been included under classification No. 2001.90.90.99 as "other vegetables preserved by vinegar or acetic acid" as claimed by the appellant.
[2] The imported product is salsa which is composed of the following ingredients: water, tomatoes, chilies, tomato paste, green peppers, dehydrated onions, vinegar, salt, spices, paprika, citric acid, garlic powder, dehydrated parsley, xanthum gum and dehydrated jalapeno peppers.
[3] The Tribunal indicated in the following terms the general approach it was adopting with regard to the inquiry:
| "The Tribunal is directed by section 10 of the Customs Tariff to classify goods in accordance with the General Rules for the Interpretation of the Harmonized System (the General Rules) and the Canadian Rules. Rule 1 of the General Rules provides that classification is to 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 principles set out in Rules 2 through 6, as well as the Canadian Rules which follow. The Tribunal is further directed by section 11 of the Customs Tariff to consider the Explanatory Notes as a guide to the interpretation of the headings and subheadings in Schedule I to the Customs Tariff. Thus, the starting point in classifying the goods in issue is to consider the terms of heading Nos. 20.01 and 21.03 and any relative Section or Chapter Notes and the Explanatory Notes, which may provide some guidance as to the appropriate interpretation of the terms of those headings." |
[4] The Tribunal found that the goods in issue could not be classified under heading No. 20.01 as that heading covers "vegetables ... preserved by vinegar or acetic acid" to the exclusion of other methods of preservation, such as citric acid and heat pasteurization used to preserve the goods in issue.
[5] We are satisfied that, in doing so, the Tribunal did not, as claimed by the appellant, add to the statutory provision an extraneous element according to which vegetables preserved "solely" by vinegar or acetic acid would come under this classification. We note that heading No. 20.05 is a more general heading which encompasses "other vegetables ... preserved otherwise than by vinegar or acetic acid ...". It was open to the Tribunal to read both headings together and to exclude from heading 20.01 the appellant's products. The issue however, was not as between headings No. 20.01 and No. 20.05, but as between headings No. 20.01 and No. 21.03.
[6] The Tribunal included the imported goods as "sauces" under classification No. 21.03 because such classification included "generally liquids, emulsions or suspensions containing very little solid matter"3. The word "generally", in the Tribunal's view, meant "usually". Consequently, goods that did not meet the general description were not necessarily excluded under that classification.
[7] Considering the "breath" of the term "sauces" and the fact that some of these sauces contained solid matter (such as meat in bolognaise) but were nevertheless classified under heading No. 21.03, we are not satisfied that the Tribunal erred in classifying under that heading the goods in question which contain 50% solid matter in volume and from 30% to 36% solid matter in weight.
[8] The Canadian International Trade Tribunal is a specialized tribunal which is owed some deference4. And although the Tribunal itself acknowledged that the imported goods do not share all of the characteristics of all the examples of sauces listed in the Explanatory Notes or in the excerpts from the Foods & Nutrition Encyclopedia5, we do not find that the Tribunal acted unreasonably and that this matter warrants our intervention.
[9] This appeal will therefore be dismissed with costs.
(Sgd.) "Alice Desjardins"
J.A.
Vancouver, British Columbia
November 4, 1998
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DATED: November 4, 1998
COURT NO.: A-47-97
STYLE OF CAUSE: Nalley's Canada Limited
v.
The Deputy Minister of National Revenue
PLACE OF HEARING: Vancouver, BC
DATE OF HEARING: November 2, 1998
REASONS FOR JUDGMENT OF THE COURT BY: DESJARDINS, J.A.
CONCURRED IN BY: ROBERTSON, J.A.
SEXTON, J.A.
APPEARANCES:
Ms. Kimberley Cook for Appellant
Mr. Jan Brongers for Respondent
SOLICITORS OF RECORD:
Kimberley Cook
Barrister & Solicitor
Nanaimo, BC for Appellant
Morris Rosenberg
Deputy Attorney General
of Canada for Respondent
__________________
1 R.S.C. 1985, c. 1 (2nd Supp)
2 R.S.C. 1985, c. 41 (3rd Supp.)
3 See Explanatory Notes to heading No. 20.01
4 Minister of National Revenue (Customs and Excise) v. Pigmalion Services (1998), 221 N.R. 91 at 92 (F.C.A.); Minister of National Revenue (Customs and Excise) v. Sunbeam Corp. (Canada) Ltd. (1998), 225 N.R. 222 at 230 (F.C.A.).