Classification by composition and frozen condition placed MILMA SIP under edible ice, not as a milk-based dairy product.

MILMA SIP was classified by reference to its composition and the condition in which it was cleared from the factory. As the product contained about 75% water, along with cane sugar, sweetening agents and colours, and only about 25% milk constituents, it was treated as a distinct prepared product rather than a chapter 4 dairy product. Because it was marketed in frozen solid form, it was held to fall under Heading 21.05 as edible ice, not under Heading 04.04 as a milk-based product.

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Issues: Whether MILMA SIP was classifiable under Heading 04.04 of the Central Excise Tariff as a milk-based product, or under Heading 21.05 as edible ice.

Analysis: The product was found to contain about 75% water with cane sugar, sweetening agents, colours and only about 25% milk constituents. It was also noticed that the product was cleared and marketed in frozen solid form, and the classification had to be determined with reference to the form and condition in which the goods were removed from the factory. On that basis, the product was held to be a distinct prepared product and not a chapter 4 dairy product.

Conclusion: MILMA SIP was correctly classified under Heading 21.05 and not under Heading 04.04.

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