TaxTMI 
TaxTMI 
2022 (7) TMI 1435
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....upplements. The applicant intends to import the following products: Table 1 1 Natuphos E 10000 7 Natugrain TS L 13 Natuphos E 50000 2 Natuphos E 5000 8 Natugrain TS DL 14 Natuphos E 5000 Combi L 3 Natuphos E 5000 L 9 Natuphos E 5000 Combi G 15 Natugrain TS 4 Natuphos E 10000 L 10 Natugrain wheat TS 16 Natupulse TS 5 Natuphos E 10000 G 11 Natuphos E 5000 G 17 Natupulse TSL 6 Natugrain TS 5XG 12 Natuphos E 17500 G As per the applicant, these products are used in the preparation of animal feeds. These products containing enzymes are used to enhance nutrient digestibility and help in enhancing the nutritive value of the animal feed. The products are used by mixing them directly into the animal feed, in the proportion as prescribed. The products in question are not subject to further processing post importation into India. The applicant states that the products which have been imported by the applicants are exclusively for use for animals and have 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 these products as....
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....e applicant. As per the applicant, if the product is merely a synthetic enzyme (pure or in combination with permitted mixtures, and additives) then the same can also be classified under heading 3507, unless it has been modified to the extent it is capable of being used for specific uses and not general use. 3. The applicant in their CAAR-1 form declared that they intend to import the impugned goods from the seaports of Nhava Sheva, Mumbai, Chennai and Kolkata and Air Cargo Complex, Mumbai. The application was forwarded to the jurisdictional commissioners of customs for comments. However, no reply has been received, though reminders have also been sent. 4. The application along with the other 4 applications of the applicant was listed on 01.06.2022 for a hearing. Sh. T. Vishwanathan and others appeared on behalf of the applicant. No one appeared on behalf of the commissioner of customs. Sh. Viswanathan explained the technical/safety data sheet, manufacturing process, composition certificate, 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, ....
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....rix): Starch, Polyvinyl Alcohol Carrier (Inorganic Matrix): Gummi Arabicum Coating: Polyethylene wax + oleic acid Water Carriar material & improves the stability of the product. Hybrid 6-phytase (10,000 FTU/g), recommended for non-pelleted or pelleting up to 95 °C of poultry, swine & fish feed. The efficient phosphorus, energy and amino acid release provides tangible benefits. Natugrain TS 5XG Yes Endo-1,4-Betaxylanase (EC 3.2.1.8), produced by Aspergillus niger Endo- 1,4-Betaglucanase (EC 3.2.1.4), produced by Aspergillus niger Other substances: Vegetable Oil Carrier: Middlings, Magnesium Suplhate Carriar material & improves the stability of the product. Endo-1,4-beta-xylanase (28,000 TXU) and endo-1,4- glucanase (12,500 TGU/g), recommended for nonpelleted or pelleting up to 85 °C of poultry, swine & fish feed. It suited to counteract the anti- nutritional effects from pentosans and beta- glucans that constitute the major part of NSPs in commonly used feedstuffs. Natugrain TS L Yes Endo-1,4-Betaxylanase (EC 3.2.1.8), produced by Aspergillus niger Endo- 1,4-Betaglucanase (EC 3.2.1.4), produced by Aspergillus niger Sorbitol, Glycerol, Sodium benzoate Carriar mat....
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....erial & improves the stability of the product Hybrid 6-phytase (5,000 FTU/g), recommended for non-pelleted feed or pelleting up to 95 °C of poultry, swine & fish feed. The efficient phosphorus, energy and amino acid release provides tangible benefits. Natuphos E 17500 G Yes Enzyme Solution 6 - phytase Carrier (Organic Matrix): Starch, Polyvinyl Alcohol Carrier (Inorganic Matrix): Gummi Arabicum Coating: Polyethylene wax + oleic acid Water Carriar material & improves the stability of the product. Hydrid 6-phy tase (17500 FTU/g), recommended for non-pelleted or pelleting up to 95 °C of poultry, swine & fish feed. The efficient phosphorus, energy and amino acid release provides tangible benefits. Natuphos E 50000 Yes 6 - Phytase Bran, Mg - sulphate, Vegetable Oil Carrier material & improves the stability of the product. Hybrid 6-phytase (50.000 FTU/g), recommended for non-pelleted or pelleting up to 80°C of poultry, swine & fish feed. The efficient phosphorus, energy and amino acid release provides tangible benefits. Natuphos E 5000 Combi L Yes Myo-inositol-hexakisphosphate beta-phosphohydrolase (EC 3.1.3.26), produced by Aspergillus niger Endo-1,4....
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....n the premix but does not affect the health of the animal. 5.1 GRI 1 provides that the classification of goods shall be "determined according to the terms of the headings and any relative section or chapter notes." In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, GRIs 2 through 6 may be applied in order. The relevant headings for classifications are reproduced below: 2309 Preparations of a kind used in animal feeding 35.07 - Enzymes; prepared enzymes not elsewhere specified or included Note to Chapter 23 states that "Heading 2309 includes products of a kind used in animal feeding, not elsewhere specified or included, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material, other than vegetable waste, vegetable residues and by-products of such processing". This chapter note is inclusive in nature and it is clear that the heading covers other items and also includes products obtained by processing vegetable or animal material, not elsewhere specified or included. This view is supported by the Tetrag....
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....ed so as to ensure, in particular, homogeneous dispersion and mixing of these substances in the compound feeds to which the preparations are added. 5.2.2 The impugned products are a combination of active ingredients and inactive ingredients such as antioxidants, minerals and stabilisers. The product composition is given in Table 2. These goods consist of active ingredients, preservatives, stabilisers and carriers. As per HSN explanatory notes, active ingredients with a suitable carrier along with additives required for preservation and transport is a premix, which is added to the complete animal feed or supplementary animal feed. The Hon'ble Tribunal in Reckitt and Colman of India Ltd. vs. CCE - 1985 (22) ELT 216 (Tribunal) has held that to qualms as a preparation the said product should be prepared by addition, mixing or such other similar process to the original commodity in order to derive a new commodity. From the above, it is clear that the products under consideration are preparations, also known as premixes. 5.3 For the identity of the products, the applicant has declared in their application that they are for animal use. The applicant in their submissions has categori....
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....g 30.03 or 30.04. Hence, while deciding the classification of the products claimed to be 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. 5.3.2 Similar clarification was issued vis 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 vita s 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. . . ....
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.... 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" 5.3.4 As per the HSN explanatory note, the heading 2309 excludes protein substances of Chapter 35. However, the impugned products contain these protein substances, i.e. enzymes in very small quantities. They can't be considered as protein only product, rather they are products containing enzymes among other substances like stabilisers, solvents, preservatives and carriers. Therefore, the impugned goods do not appear to be hit by the above-mentioned exclusion clause. 5.3.5 The applicant has submitted that the impugned products are 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....
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....ecific heading in the Nomenclature. This group includes, inter alia: (i) Enzymatic preparations for tenderising meat, such as those consisting of a proteolytic enzyme (e.g., papain) with added dextrose or other foodstuffs. (ii) Enzymatic preparations for clarifying beer, wine or fruit juice (e.g., pectic enzymes containing added gelatin, bentonite, etc.). (iii)Enzymatic preparations for desizing textiles such as those with a basis of bacterial a-amylases or proteases. This heading excludes, inter alia, the following preparations: (a) Medicaments (heading 30.03 or 30.04). (b) Enzymatic preparations for pre-tanning (heading 32.02). (c) Enzymatic soaking or washing preparations and other products of Chapter 34. The following are the most important among the enzymes found in trade:... ... (6) Amylases and proteases obtained from micro-organisms. Certain micro-organisms, when grown in appropriate culture media, secrete a considerable quantity of amylases and proteases. After removal of the cells and other impurities, the solutions are either concentrated by low temperature vacuum evaporation or the enzymes are precipitated by the addition of inorganic salts (e.g., ....