Food products not classified as "Ice-Cream" for excise duty purposes.

The Appellate Tribunal CESTAT, Mumbai held that food products like Orange Fruity, Mango Kupple, and Raspberry did not meet the criteria to be classified as "Ice-Cream" for excise duty purposes under Notification No. 12/90 and Notification No. 4/93. The Tribunal rejected the Revenue's appeal, affirming that the products were correctly classified as "other than Ice-Cream" based on the lack of common knowledge and milk content criteria. The lower authorities were deemed unjustified in applying the Prevention of Food Adulteration Act criteria for classification.

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Issues:
Interpretation of Notification No. 12/90 and Notification No. 4/93 regarding the classification of food products as "Ice-Cream" for excise duty purposes.

Analysis:
The appeals before the Appellate Tribunal CESTAT, Mumbai involved the classification of food products such as Orange Fruity, Raspberry Kupple, Mango Fruity, Mango Kupple, Pista Candy, etc., manufactured and cleared by the appellant, as either "Ice-Cream" or "other than Ice-Cream" for the purpose of excise duty under Notification No. 12/90 and Notification No. 4/93. The lower authorities had granted the benefit of Nil rate of duty to the products based on the milk fat content ranging from 6% to 9%, which was below the 10% threshold specified in the Prevention of Food Adulteration Act (PFA) for products to be considered as Ice-Cream.

The Revenue contended that the lower authority erred in considering the PFA criteria to determine the classification of the products as Ice-Cream. The Tribunal acknowledged the presence of the explanation in the Notifications defining Ice-Cream based on common knowledge and milk content criteria. The Tribunal noted that the products in question, such as Orange Fruity, Mango Kupple, and Raspberry, were not commonly known as Ice-Cream, as evidenced by the absence of proof provided by the Revenue. Therefore, the first criteria of being commonly known as Ice-Cream was not met, leading to the conclusion that the products were "other than Ice-Cream" and eligible for the Nil rate of duty under Serial No. 5 of the Notification.

In conclusion, the Tribunal held that the lower authorities were not justified in applying the PFA criteria to determine the classification of the products as Ice-Cream. The Tribunal found no merit in the Revenue's appeals and rejected them, affirming the classification of the products as "other than Ice-Cream" for excise duty purposes under the relevant Notifications.

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