Pasteurised milk classification turns on commercial identity, and added vitamins did not convert it into a milk product.

Pasteurised milk remains classifiable as milk under the Kerala General Sales Tax Act when vitamins A and D are added, if the product continues to retain the natural flavour, characteristics and commercial identity of milk. A milk product, by contrast, is a commodity obtained from milk that is materially different in composition, character or use from milk in its natural or pasteurised form. On that reasoning, Amul Tazza Milk was treated as pasteurised milk under entry 23 of the Third Schedule and not as a taxable milk product under entry 92 of the First Schedule.

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Issues: Whether Amul Tazza Milk, after pasteurisation and addition of vitamins A and D, is classifiable as pasteurised milk under entry 23 of the Third Schedule to the Kerala General Sales Tax Act, 1963 or as a milk product under entry 92 of the First Schedule to the Act.

Analysis: The relevant entries distinguish exempt fresh milk including pasteurised, toned or reconstituted milk from taxable milk products. Milk product, in this context, denotes a commodity obtained from milk which is materially different in composition, character or use from milk in its natural or pasteurised form. The addition of vitamins A and D to pasteurised milk was held not to destroy its identity as pasteurised milk, since the product continued to retain its natural flavour and characteristics and did not become a different commodity in commercial parlance.

Conclusion: Amul Tazza Milk is pasteurised milk falling under entry 23 of the Third Schedule and not a milk product under entry 92 of the First Schedule; the classification adopted by the authorities was and the assessee succeeded.

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