TaxTMI 
TaxTMI 
2023 (2) TMI 674
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....roduct : TABLE : 1 Sr. No. Product Name Composition Purpose, the form of import & manner of usage 1. Lutalin 28% Omega-6 fatty acid, (C18:2) methyl ester This feed additive is used for animal feeding. These are Conjugated Linoleic Acids (CLA) that help to assure flexibility of membranes and starting materials for hormones. It reduces milk fat production, increases milk yield and improves blood glucose levels in lactating cows. As per the applicant, the product which has been imported is formulated with rumen bypass effect, like rumen-protected fat or pelleted feedstuff. It reduces milk fat production, increases milk yield and improves blood glucose levels in lactating cows. Post importation, this product is used by mixing it directly into the animal feed, in the proportion as prescribed. The product in question is not subject to further processing post importation. The applicant further submits that this product is exclusively for use for animals and has no other use, either as medicine or for the manufacture of medicine. 2.1 In regards to classification, the applicant submits that the global desk of the M/s. BASF classifies this product ....
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....others appeared on behalf of the applicant. No one appeared on behalf of the Commissioners of Customs. Sh. Viswanathan explained the technical/safety data sheet, manufacturing process, composition, and product labels of each item for which advance ruling has been sought. The applicant also submitted a compilation containing, inter alia, notifications/circulars, cross-rulings, case laws, etc. My attention was specifically drawn to the decisions of the Hon'ble Tribunal in the case of Lalchand Bhimraj & Tetragon Chemie as well as the C.B.E. & C. Circular of 26-3-1996. Sh. Vishwanathan gave assurance to submit detailed compositions along with a manufacturing flow chart of the products. 4.1 The applicant additionally submitted an excel sheet containing the end use of the product and its inactive ingredients. Table : 2 Product name Whether the product contains additives (Yes/No) Active Ingredients Inactive ingredients Usage of inactive ingredients End-use of the product Lutalin Yes 28% Omega-6 fatty acid Methyl ester N/A Lutalin can be used in ruminants & Pig feed. Lutalin makes a positive contribution to the lifetime yield and fertility of ....
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....ficacy of methyl ester of conjugated linoleic acid (t10,c12 isomer) for pigs for fattening, sows and cows : EFSA Panel on Additives and Products or Substances used in Animal Feed (FBEDAP)] published by European Food Safety Authority on 5-1-2016 was referred to find out the complete composition of the product under consideration. The composition, as per the said paper is as below : Lulalin is a liquid formulation of the additive that contains by specification a minimum of 28%, of CLA (t10,c12)-ME. It also contains $ 28%, CLA (c9,t11)-ME, < 2%, CLA (t10,c12), < 2% CLA (c9,t11), approximately 40%, of other fatty acids of sunflower oil (free or as methyl esters) and < 1%, of trans, trans-isomers. 10 Other specifications concern moisture (< 0.5%), acid value (< 20 mg KOH/g), peroxide value (< 64 mg peroxide oxygen/kg) and methanol (< 150 mg/kg). Analysis of five batches resulted in an average of 29.5%, CLA (t10.c12)-ML (range : 29.3-29.7%), 30.1%, CLA (c9,t11)-ME (29.3-32.2%), < 0.1%,CLA (t10,c12) and CLA (c9,t11) each, 3.2%, palmitic acid-ME (0.8-6 5%), 3.8% stearic acid-ME (3.7-3.8%), 29.7%, oleic acid-ME (25.0-33.1%,) and 1.6% LA-ME (0.0-2.0%), 0.52% trans, trans-CLA-isomers....
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....n Animal Feeding 2916 Unsalurated Acyclic Monocarboxylic Acids, Cyclic Monocarboxylic Acids, Their Anhydrides, Halides 5.3 Chapter 29 covers organic chemicals. Note 1 to said chapter states as below : 1. Except where the context otherwise requires, the headings of this Chapter apply only to : (a) Separate chemically defined organic compounds, whether or not containing impurities; (b) Mixtures of two or more isomers of the same organic compound (whether or not containing impurities), except mixtures of acyclic hydrocarbon isomers (other than stereoisomers), whether or not saturated (Chapter 27); (c) The products of headings 29.36 to 29.39 or the sugar ethers, sugar acetals and sugar esters, and their salts, of heading 29.40, or the products of heading 29.41; whether or not chemically defined; (d) The products mentioned in (a), (b) or (c) above dissolved in water; (e) The products mentioned in (a), (b) or (c) above dissolved in other solvents provided that the solution constitutes a normal and ....
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....ately left in the product with a view to rendering it particularly suitable for specific use rather than for general use, they are not regarded as permissible impurities. For example, a product consisting of methyl acetate with methanol deliberately left in with a view to improving its suitability as a solvent is excluded (Heading 38.14). For certain compounds (e.g., ethane, benzene, phenol, pyridine), there are specific purity criteria, indicated in Explanatory Notes to Headings 29.01, 29.02, 29.07 and 29.33. In the present case, the starting material, as provided in the product brochure is non-GMO sunflower oil. As mentioned in Para 5, approximately 40% of other fatty acids of sunflower oil are present in the product. These can be considered as unconverted starting material or impurities present in the starting material. However, the percentage of these impurities (40% including around 29% of oleic acid) is very high. In a commercial product like Lutanin, such a high level of impurity can only have been deliberately left with a view to rendering it particularly suitable for specific use rather than for general use. 5.4 Note to Chapter 23 states that "Heading 2309 inclu....
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....acids, antibiotics, coccidiostats, trace elements, emulsifiers, flavourings and appetisers, etc. (2) Those designed to preserve the feeding stuff (particularly the fatty components) until consumption by the animal : stabilisers, anti-oxidants, etc. (3) Those which serve as carriers and which may consist either of one or more organic nutritive substances (manioc or soy flour or meal, middlings, yeast, various residues of the food industries, etc.) or of inorganic substances (e.g., magnesite, chalk, kaolin, salt, phosphates). The concentration of the substances described in (1) above and the nature of the carrier are determined so as to ensure, in particular, homogeneous dispersion and mixing of these substances in the compound feeds to which the preparations are added. The impugned product is a combination of active ingredient CLA and inactive ingredients containing other fatty acids. The product composition is given in Para 5. From the above, it is clear that the products under consideration are preparations, also known as premixes. 5.4.3 For the identity of the product, the applicant has declared in th....
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....e animal feed supplements, it may be necessary to ensure that the said animal feed supplements are ordinarily or commonly known to the trade as products for specific use in animal feeding." According to the Board, the preparation containing active ingredient preparations used for animal feeding is classifiable under Heading 2309. The Board has also clarified that while deciding the classification of the products claimed to be animal feed supplements, it is necessary to ensure that the said animal feed supplements are ordinarily or commonly known in the trade as products for specific use in animal feeding. 5.4.5 Similar clarification was issued viz. Board Circular No. 80/54/2018-GST, dated 31-12-2018. The relevant paras are reproduced below : "5.2 As per the HSN, 2309 inter alia covers reading vitamins and provitamins which improve digestion and, more generally, ensure that the animal makes good use of the feeds and safeguards its health. On the other hand, HS code 2936 coves vitamins and provitamins which are medicinal in nature and have a much higher concentration of an active substance. xx       xx  &e....
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....s, appetisers, soya flour or meal, yeast, etc. are covered by it. We think that the test laid down by the Hon'ble Bombay High Court in the case of Chemical Fibres [1982 E.L.T. 917] is a safer and reliable test where the evidence of trade usage is not beyond doubt, then a reference to technical literature cannot be precluded. In regard to Niger Seed/Rice Bran extractions, we hold that they are animal feed." 5.4.7 The applicant has submitted that the impugned product is commonly known in the trade as products for specific use in animal feeding i.e. to manufacture animal feed. The safety data sheet provided by the manufacturer mentions the use of these products as feed additives. The manufacturer on their global website https://www.basf.com/global/en.html has categorised these products as feed ingredients under animal nutrition products. BTC Europe GmbH is BASF's European sales organization, which provides expert opinion in respect of chemicals. On their website, https://www.btc-europe.com/en/GB/, they give product solutions based on the specific needs of a customer, i.e., they help customers find a suitable product for their needs. On this website, the product under considera....