Classification of Enzyme-Based Animal Feed Products under Customs Tariff Act

The 17 enzyme-based products used in animal feed were classified under heading 2309 and subheading 23099090 of the Customs Tariff Act, 1975. The applicant's argument that the products should be classified under heading 2309 due to their specific use for animal feed was supported by technical data and relevant circulars. The Board's circulars also clarified the classification of products containing active ingredients for animal feeding under heading 2309. The end-use of the products for animal feed, along with the presence of enzymes as part of premixes, justified their classification under heading 2309.

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Issues Involved: Classification of enzyme-based products for animal feed.

Issue-wise Detailed Analysis:

1. Background and Application:
M/s BASF India Limited filed an application for advance rulings on the classification of 17 enzyme-based products used in animal feed. The applicant is involved in trading and manufacturing chemicals and animal feed, and imports these products from BASF Germany and other third parties.

2. Applicant's Submissions on Classification:
The applicant argues that the products should be classified under heading 2309 of the Customs Tariff Act, 1975, as they are used specifically for animal feed and not for any general use. They reference Circular No. 80/54/2018-GST and Circular No. 188/22/95-CX to support their claim that these products, which are used as food supplements for animals, should be classified under heading 2309.

3. Alternative Classification Suggested by Applicant:
Alternatively, the applicant suggests that the products could be classified under subheading 35079099 as 'Enzymes; prepared enzymes not elsewhere specified or included; Other; Other', similar to the global classification adopted by BASF.

4. Hearing and Submissions:
During the hearing, the applicant provided detailed technical and safety data sheets, manufacturing processes, composition certificates, and product labels. They also submitted a compilation of notifications, circulars, cross-rulings, and case laws. An excel sheet detailing the end-use of the products and their inactive ingredients was also submitted.

5. Analysis of the Products:
The products in question contain enzymes derived from Aspergillus Niger and Thermothelomyces thermophilus and are used as premixes in animal feed. These enzymes, such as phytases and non-starch polysaccharides (NSP), enhance nutrient digestibility and improve the nutritive value of animal feed.

6. Relevant Headings for Classification:
The relevant headings for classification are:
- 2309: Preparations of a kind used in animal feeding.
- 3507: Enzymes; prepared enzymes not elsewhere specified or included.

7. GRI 1 and HSN Explanatory Notes:
According to GRI 1, classification should be determined by the terms of the headings and any relative section or chapter notes. Heading 2309 includes products used in animal feeding, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material.

8. HSN Explanatory Notes on Premixes:
The HSN explanatory notes to heading 2309 cover premixes, which are compound compositions consisting of active ingredients, preservatives, stabilizers, and carriers. These premixes are used in making complete or supplementary animal feeds.

9. Supporting Documents:
The applicant submitted certificates from the German Government's certifying agency and test reports from Doctors Analytical Laboratories Pvt. Ltd., confirming that the products are feed supplements of animal grade.

10. Board's Circulars:
Board's Circular No. 188/22/95-CX and Circular No. 80/54/2018-GST clarify that preparations containing active ingredients used for animal feeding are classifiable under heading 2309.

11. End-Use Based Heading:
Heading 2309 is an end-use-based heading, as established in the case of Tetragon Chemie (P) Ltd vs. Commissioner of Central Excise, Bangalore. The products in question are used specifically for animal feed, justifying their classification under heading 2309.

12. Exclusion from Heading 3507:
The products contain enzymes in small quantities along with other substances like stabilizers, solvents, preservatives, and carriers. Therefore, they do not merit classification under heading 3507, which covers enzymes and prepared enzymes not elsewhere specified or included.

Ruling:
The 17 enzyme-based products listed in Table 1 are classifiable under heading 2309 and more specifically, under subheading 23099090 of the first schedule to the Customs Tariff Act, 1975.

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