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2018 (10) TMI 1788 - CESTAT NEW DELHIClassification various products being manufactured by the appellant - Cake Mixes, Baker Mixes, Bread improvers, Cake Improvers, Baker Puff Mix etc., which are used by the sweet shops, bakers, confectioners and super market for making cakes, manufacturing of biscuits, making of instant energy drinks, nutritional supplements etc. - appellant has classified these products under Chapter heading 2106 90 99 of First Schedule to Tariff Act (for short CETA) Central Excise Act, and removed them at Nil rate of duty up to 28-2-2011 by availing of exemption from Central Excise Duty under Sl. No. 30A of Notification No. 3/2006, dated 1-3-2006 - benefit of exemption in terms of Sl. No. 19 of Notification No. 1/2011, dated 1-3-2011. Whether impugned goods to be classified under Chapter heading 2606, 0404, 2106 and 1102/1108 as claimed by the appellant or under Chapter Heading 1901 20 20 as claimed by the Department? HELD THAT:- As the appellant does not manufacture the product of Malt extract to group on (i) is not relevant and so is the case for products falling in group, (ii), which consists of all the material derive from flour, groats or meals, which derive from essential character from such material which is not the case here. Though the starch content in cake decor is quite substantial by weight, i.e. 40% to 45% (which is next only to sugar at 45% to 50%), however, still, in terms of the HSN Notes to Chapter heading 19.01, as extracted above, it emerges that the percentage content of starch is not relevant for classification of the product under this heading. What is relevant is that the product should derive its essential character from starch which is also supported by the HSN Notes to the Chapter Heading 2106 - Further in the present case, the main ingredients providing the essential character to the product are colours and flavours. The essential character of the product is imparted by colours and flavours. The Ld. Commissioner at paragraph 52.2 has accepted this fact but has concluded the classification of the product would be under the Chapter Heading 1901, on the ground that the same is used for decoration of bakers’ wares of Chapter Heading 1905 of CETA. There is nothing in the Tariff Heading 2106 which bars the use of the products falling therein in the decorations of the bakers’ wares. On the contrary, each of the product group under the HSN Notes to Tariff Heading 2106 reflects those can be used in bakerswares as well. The product ready to use mixes, comprises of milk solids to the extent of 45% to 50% to enhance taste, nutrition and also provide milky note, sugar 25% to 30% to impart sweetness of the product and flour 15 to 18% to act as filler and remaining portion phosphate and salt, which act as buffering agent and regulator, to give stability to the product and salt is used as preservative - The product does not fall under any of the category of the products covered by Chapter heading 1901 as discussed in preceding paragraph. Since, it is not a malt extract, preparation, milk preparation also the product is out of the purview of Chapter 4, as only half of the composition of the product is milk solids and contains impermissible ingredients like flour etc., and therefore, only heading left for deciding classification is Tariff Heading 2106, which is referred to other food products not elsewhere specified. Classification of bakers mix, bread improver and break mix - HELD THAT:- These are classifiable under chapter Heading 1102 of the not under 1901 as argued by the appellant on the basis of the precedent decision of this Tribunal in case of HELIOS FOOD ADDITIVES PVT. LTD. VERSUS COMMISSIONER OF C. EX., PUNE-II [2006 (9) TMI 56 - CESTAT, MUMBAI] - the appellant contention regarding classification of items under Heading 1102 is more appropriate and needs to be affirmed in the appeal. Classification bakers ware mix, biscuit improvers, biscuit mix - HELD THAT:- The product would be classified under chapter Heading 1108 of CETA - thus the Department contention regarding the classification of this product under Chapter heading 1901 is not sustainable and require to be set aside. Extended period of limitation - HELD THAT:- Each and every information which are required to be provided by the appellant for classification of the product have been furnished to the Department. Nothing has been suppressed by the appellant so as to create any confusion to the Departmental officer regarding description and classification of products. In such circumstances, it is not possible to sustain the demand for the extended period. Appeal allowed - decided in favor of appellant.
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