Milk-based kulfi remains classifiable as a dairy product under Chapter 0404.00 despite limited additives or ready-to-consume form.

Kulfi was treated as a milk-based preparation classifiable under Chapter Heading 0404.00 because its essential character remained that of a dairy product. The tariff scheme and HSN explanatory notes show that Chapter 04 covers milk products even where limited additives such as sugar, flavouring or nuts are present. On that basis, a ready-to-consume kulfi does not shift to Heading 2105.00 merely because it resembles ice cream. The earlier classification approach for kulfi-related products under Heading 04.04 was followed, and the revenue classification under Heading 2105.00 was rejected.

---

---

Issues: Whether the product "Kulfi" manufactured by the assessee was classifiable under Chapter Heading 0404.00 as a milk product or under Chapter Heading 2105.00 as ice cream.

Analysis: The product was found to be a milk-based preparation and the manufacturing process described by the assessee was not in dispute. The relevant tariff entries were examined along with the HSN explanatory notes, which indicate that Chapter 04 covers dairy products and milk products even where limited additives such as sugar, flavourings, nuts, or similar ingredients are present. Relying on the earlier classification of kulfi-related products under Heading 04.04, the Tribunal held that a ready-to-consume kulfi would also fall within the same heading and would not move to Heading 21.05 merely because the department treated it as ice cream.

Conclusion: Kulfi manufactured by the assessee was correctly classifiable under Chapter Heading 0404.00, not under Chapter Heading 2105.00.

Final Conclusion: The classification adopted by the revenue authorities was set aside and the assessee obtained the relief flowing from acceptance of classification under Heading 0404.00.

Ratio Decidendi: A milk-based product remains classifiable under the dairy-products tariff heading where its essential character is that of a milk product and the presence of permissible additives does not alter that classification.

---