TaxTMI 
TaxTMI 
1998 (3) TMI 423
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....er sub-heading No. 0404.00 of the Schedule to the Central Excise Tariff Act, 1985 (hereinafter referred to as the "Tariff"), as "other dairy produce; edible products of animal origin, not elsewhere specified or included". Chapter 4 of the Tariff covered dairy produce; edible products of animal origin not elsewhere specified or included. The Revenue had classified the product in question under sub-heading No. 2107.91 of the Tariff which covered edible preparations not elsewhere specified or included, put up in unit containers and ordinarily intended for sale, other than prasad or prasadam and sterilised or pasturised miltone. Chapter 21 of the Tariff covered miscellaneous edible preparations. The Collector Central Excise (Appeals) in Appeal No. 2645/89-D had observed that the calcium caseinate an ingredient of the final product was not dairy product and that it might be made from milk (milk as the raw material) but that does not make the calcium caseinate a dairy product. In Appeal No. E/1403/88-D the Collector, Central Excise (Appeals) had observed that the mere presence of calcium caseinate which was a chemical extract from milk could not be a ground for considering the Spert as o....
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....t was not a dairy produce. It was an edible preparation and as it was not a dairy produce. It was correctly classifiable under Chapter 21 of the Tariff which covered miscellaneous edible preparations. As it was put up in unit containers and was intended for sale and as it was not covered by other edible preparations as specifically classified under Heading Nos. 21.01 to 21.06, it was correctly classifiable under sub-heading No. 2107.91 of the Tariff. 6. In rejoinder the ld. Advocate referred to the certificates given by the experts advising that as a protein food supplement, `Spert' derived practically its entire proteins from calcium caseinate and skimmed milk powder which in turn were both wholly derived from natural milk. 7. We have carefully considered the matter. The issue for our consideration in both these appeals is whether the product `Spert' is a dairy produce for the purposes of classification under Chapter 4 of the Tariff sub-heading No. 0404.00 which covered "other dairy produce". Chapter 4 of the Tariff covered dairy produce; edible products of animal origin, not elsewhere specified or included. Heading No. 04.01 covered milk and cream, concentrated or....
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.... 54.40. In reply dated 2-9-1986 to the Show Cause Notice dated 11-7-1986 M/s. Wander Ltd. had given the composition of `spert' per hundred gm as follows :           Quantity Ingredients Spert plain Spert chocolate Spert strawberry Liquid glucose 41.30 gm   41.30 gm  41.30 gm  Skimmed Milk Powder 24.30 gm   24.30 gm  24.30 gm  Calcium Caseinate 18.00 gm   18.00 gm  18.00 gm  Malt Extract 5.30 gm    5.30 gm  5.30 gm  Sugar 10.00 gm   5.00 gm  10.00 gm  Vitamins & Flavours 1.10 gm   1.10 gm  1.10 gm  Cocoa powder -    3.80 gm  -    Liquid caramel -    1.20 gm  -    100.00 gm 100.00 gm 100.00 gm  9.  Dairy is an establishment for the sale and distribution of milk and milk products. The important dairy products are butter cheese, casein, milk, sugar, cream....
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....8 maltose and dextrin 50.5,   *These values represent average composition of consumer products, not legal minimum standards. Source : B.H. Webb and A.H. Johnson. Fundamentals of Dairy Chemistry, 1965, and Composition of Foods, USDA Haldbook No. 8, 1963. At page 434 of the said publication it had been stated that the skim milk, butter milk, casein, whey and whey components including lactose or milk sugar are by-products of the dairy industries. The skim milk is a source of casein and lactose which are prepared from it. Whey is a by-product of cheese and casein manufacture and is an important source of whey protein and lactose. Butter milk is a by-product of the churning cream. According to the Kirk-Othmer Encyclopedia of Chemical Technology III Edition Volume 15 page 568, milk containing proteins and essential amino acids. Casein, a mixture of several protein, is the principal protein in the skim milk (non-fat) portion of milk (3-4% of the weight). After it is removed from the liquid portion of milk, whey remains. Casein is used to fortify flour, bread and c....
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.... medicines. 11. Thus it is seen that the casein and calcium caseinate in themselves were the product of chemical reaction and are produced in dairy processing industry and not by the milk processing plant. The final product `Spert' with which we are concerned was neither a product of milk processing plant nor of the dairy processing industry. It was manufactured in a separate factory with some of the ingredients which were the product of milk processing plant and of dairy processing Industry. In itself it was neither produced in a milk processing plant nor in dairy processing industry. 12. We have already referred to Chapter Note 4 under Chapter 4 of the Tariff which provided as under : "Heading No. 04.04 applies inter alia to butter milk, curdled milk, cream, yogurt, whey, curd and products consisting of natural milk consti- tuents, whether or not containing added sugar or other sweetening matter or flavoured or containing added fruit or cocoa." Butter milk, curdled milk, cream, yogurt and curd are the dairy products consisting of natural milk constituents. The expression "products consisting of natural milk constituents" could not cover a food supplement of ....
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....Flavoured milk 4883-1968 KHOA 4884-1968 Sterilized cream 5162-1969 CHHANA 5163-1969 Sweet cream butter milk powder 5550-1970 BURFI 5962-1970 Sour partly skimmed milk powder 6387-1971 Vegetable protein infant food with milk 6397-1971 Code for pasteurization of milk 7035-1973 Fermented milk products There is no mention of protein rich concentrated nutrient supplementary foods therein. The protein rich concentrated nutrient supplementary foods find mention only in the Indian standards on nutritious foods which include the following : INDIAN STANDARDS ON NUTRITIOUS FOODS IS : 3137-1974 High protein mixes for use as food supplement (first revision) 4684-1975 Edible groundnut flour (expeller pressed) (first revision) 4874-1968 Cottonseed flour (expeller pressed ) (first revision) 4875-1975 Edible groundnut flour (solvent extracted) (first revision) 4876-1968 Cottonseed flour (solvent extracted) (first revision) 6108-1971 Edible sesame flour (solvent extracted) 6109-1971 Edible....
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....tration having protein concentration between 45 to 70%. They had argued that protein rich concentrated nutrient supplementary food with protein concentration of 20% was different from the protein concentrates. We have already referred to the Chapter Note 5 under Chapter 21 of the Tariff and it is seen that the protein concentrates were not the only products which were covered by Heading No. 21.07. The scope of Heading No. 21.07 was wide enough to cover the products. 17.  In the case of Collector of Central Excise, Pune v. Frozen Foods Pvt. Ltd. [1987 (27) E.L.T. 195 (Tribunal)] the matter related to the erstwhile Central Excise Tariff. The issue for consideration before the Tribunal was whether the product named `Spert' was covered by Entry 14 in the Schedule to Notification No. 18/70-C.E., dated 1-3-1970. The said notification had a list of dutiable goods falling under the then erstwhile Item No. 1B of the erstwhile Tariff, broadly described as prepared or preserved foods. Entry 14 of the notification read as under : "Preparations with a basis of flour, of starch, of malt extract, or of malted barley, and milk foods, which by simply mixing with, or boiling in milk or wa....
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.... or by a chemical reaction would make no difference to the end product. They had illustrated that the butter milk did not cease to be a milk product merely because a chemical process was involved in the transformation. In that case only bones were the raw materials from which the products manufactured by the respondent Company were derived. In the manufacture of ossein and gelatine no other raw materials were used to such an extent as to completely over-shadow or render insignificant the utilisation of bone in the process. The product before us did not emerge from the dairy. It is a product of processing industry and in it there were a number of ingredients which have nothing to do with a dairy. It is a food supplement and not a dairy product. 19. In the case of Rollatainers Ltd. v. Union of India [1994 (72) E.L.T. 793 (S.C.)] the Supreme Court had viewed that the question as to whether a printed carton was or was not a product of printing industry had to be decided as how it means to a common man in the trade and in common parlance. The Apex Court agreed with the Division Bench of the Karnataka High Court that a product must be classified having regard to what it means and....