Tariff classification of processed poultry waste as animal feed hinges on loss of original character and trade use as a supplement.

Processed poultry waste that has been rendered, cooked, dried and powdered, and is marketed as a feed supplement, loses the essential character of mere residue or waste and is classifiable as a preparation used in animal feeding. The tariff distinction in Chapter 23 turns on whether the product remains a waste from the food industry or has become a distinct marketable feed product. The absence of added nutrients does not prevent classification under Heading 2302 / 2309. Accordingly, the product falls under Heading 2302 of the Central Excise Tariff Act, 1985 and Heading 2309 of the Customs Tariff Act, 1975, not under Heading 2301.

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Issues: Whether High Protein Poultry Mash, obtained by processing poultry waste, was classifiable as residues and wastes from food industries under Heading 2301 or as preparations of a kind used in animal feeding under Heading 2302 of the Central Excise Tariff Act, 1985 and Heading 2309 of the Customs Tariff Act, 1975.

Analysis: The product emerged after collection and processing of poultry offals, feathers, blood, heads and legs through rendering, cooking, drying and powdering. The resultant material was not cleared as raw waste but as HPPM and was commercially described by the manufacturer itself as a poultry feed supplement. Chapter 23 of the tariff and the HSN notes distinguish between mere residues and waste on the one hand and products obtained by processing animal materials to the extent that they lose their essential character on the other. The processed material had lost the essential characteristics of the original waste and had become a distinct marketable product used in animal feeding. The argument that added nutrients were necessary for classification under Heading 2302 / 2309 was rejected, because the heading also covers products used in animal feeding even without such additions. The claim for Heading 2301 failed because the goods were no longer mere residues or wastes from the food industry.

Conclusion: HPPM was correctly classified under Heading 2302 of the Central Excise Tariff Act, 1985 and Heading 2309 of the Customs Tariff Act, 1975, and not under Heading 2301.

Final Conclusion: The classification adopted by the Revenue was upheld and the appeals challenging the classification were rejected.

Ratio Decidendi: Where a processed product derived from animal waste has lost the essential character of the original material and is known in trade as a feed supplement, it is classifiable as a preparation of a kind used in animal feeding rather than as a mere residue or waste from the food industry.

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