Central Excise - Classification of ghee whether under heading 04.04 or sub-heading 0402.10 of Central Excise Tariff 1985 - Regarding - Central Excise - 8/88

Central Excise - Classification of ghee whether under heading 04.04 or sub-heading 0402.10 of Central Excise Tariff 1985 - Regarding Government of India Ministry of Finance (Department of Revenue) New Delhi Circular No. 8/88 Dated 25-2-1988 [From F. No. 10/13/87-CX.1] Subject : Central Excise - Classification of ghee whether under heading 04.04 or sub-heading 0402.10 of Central Excise Tariff 1985 - Regarding. Doubts have been expressed as to whether ghee obtained from butter should be classified under heading 04.04 or heading 04.02 of the Central Excise Tariff, 1985. 2. This point was discussed in the conference of Collectors of Central Excise of West Zone in Dec., 1987 at Baroda and after taking into account its views the matter was further examined in the Ministry. The Ministry took note of the fact that the Central Excise Tariff heading 04.02 specifies only "Butter whether pasturised or not" whereas the corresponding H.S.N. heading 04.05 reads as "butter and other fats and oils derived from milk". Thus, there is difference between the Central Excise heading and the Corresponding H.S.N. heading. In Indian conditions Ghee is not known as butter and the trade dealing in these goods and the general public do distinguish Ghee from butter. Therefore, the Ministry feels that Ghee cannot be quated with butter for the purpose of Central Excise Tariff as there is no Chapter note or Section note suggesting that Ghee is the same as butter, though having regard to conditions abroad, in H.S.N. Explanatory Notes it has been mentioned that Ghee is a kind of butter made most commonly from the milk of buffaloes or cows (page 32 of H.S.N. Explanatory Notes). Further, in the H.S.N., there is no residuary entry for 'other dairy produce' as in the Central Excise Tariff heading 04.04 which includes other dairy produce. 3. In view of the above facts, the Ministry is of the view that Ghee is classifiable as 'other dairy produce' under heading 04.04 of the Central Excise Tariff. 4. Trade interests may be informed accordingly.