TMI Blog2023 (6) TMI 960X X X X Extracts X X X X X X X X Extracts X X X X ..... ral nutrients designed for use in making complete or supplementary feeds . Further as stated by the appellants squid liver powder contains certain proteins, peptides and amino acids in it. They are in line with the HSN description, as being composed consisting of a number of substances, sometimes called additives, the nature and proportion of which vary according to the animal production requirement. As stated by appellants, squid liver powder is used in shrimp feed formulation as an attractant. It is common knowledge that feeding is the main way for fish to obtain nutrition for the survival, growth and reproduction of fish/ shrimp etc. Attractants are added to the feed to improve not only the feed palatability thereby reducing wastage but also to increase feed intake resulting in fish growth, and are mainly used in captive fish farms. It hence ensures that the fish/shrimp make good use of the feeds and safeguard its health - apart from a plain reading of the Customs Tariff the classification of squid liver powder under 2309 also satisfies the relevant notes (A) and (C) of II Other Preparations given in the HSN. Hence squid liver powder merit classification under the CTH 2309. Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertain to them. Further, the copy of the said report was also not given to the appellant. This amounts to gross violation of principles of natural justice. He stated that the appellant submits that squid liver powder is manufactured from the Viscera, Skin and Eyes of squid which belongs to the family of Cephalopods of Phylum molluscs. The viscera of squid is rich in amino acids, minerals vitamins etc. and therefore it forms a good constituent for poultry and aqua feed. The squid liver is cooked at 70 degrees centigrade for 30 minutes and oil is separated for further refining. From the resultant squid water soluble, water is evaporated and soyabean meal is added. The mixture is dried, cooled and grounded. Anti-oxidants are added for retention of freshness. The residual squid oil is found to contain a very large amount of unsaturated fatty acids. The squid liver soluble derived during the process is sticky and unless a carrier such as soya bean meals is mixed with it, squid liver powder cannot be extracted. The soyabean meal is preferred as a carrier compared to products such as rice bran for the reason that soya protein has a property of increased water solubility, emulsifying capac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel appearing on behalf of M/s. Godrej Agrovet Ltd. has stated that is an ingredient in the shrimp feed manufactured by the appellants. The squid liver powder is obtained by processing the internal organs of the squid. Squid falls under the category of Molluscs. The main ingredients of the squid liver powder are squid waste and feed grade soya bean meal. The manufacturing process of involves the following steps:- a. removal of oil from the squid liver / internal organs b. the material obtained after removal of oil, which is fluidic in nature, is mixed with soya bean meal and evaporated c. the material so obtained is dried, cooled and then ground. The squid liver powder contains certain proteins, peptides and amino acids in it. These proteins peptides and amino acids are soluble in water. They gradually dissolve in water attracting the shrimps to the feed. It is thus used as an attractant in the animal feed (shrimp feed). It does not have any nutritional value of its own. 4.1 He submits that the imported goods are correctly classifiable under CTH 2301. He has taken us through the HSN Explanatory Notes to Heading 2301 and 2309 and stated that HS Code 2309 would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etable waste, vegetable residues and by-products of such processing. Sub-heading Note: For the purposes of sub-heading 2306 41, the expression low erucic acid rape or colza seeds means seeds as defined in sub-heading Note 1 to Chapter 12. Tariff Item Description of the goods Unit Rate of Duty (1) (2) (3) (4) (5) 2301 Flours, meals and pellets, of meat or meat offal, of fish or of crustaceans, molluscs or other aquatic invertebrates, unfit for human consumption; greaves 2301 10 - Flours, meals and pellets, of meat or meat offal; greaves 2301 1010 --- Meat meals and pellets (including tankage) Kg. 30% 2301 10 90 --- Other (including greaves) Kg. 30% 2301 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f animal (squid) origin and the other of plant origin, with small quantities of other ingredients. The appellants are of the opinion that CTH 2309 is intended for products which are used for feeding the animals directly i.e. finished products. As per the Order in Original, the website of the supplier describes squid liver powder as a high-quality feed ingredient for aqua feed (especially shrimp) and all type diet for animals. The flours, meals and pellets of heading 2309 are used mainly in animal feeding. Since these products and preparations are used in animal feeding they include in their imported form feed stuff that cannot be consumed directly by animals and are for use in making / manufacturing the final feed also. Hence the heading also covers feed ingredients i.e. products which go into the manufacture of animal feeds and need not be an end product in itself. There is nothing in the Chapter Notes to suggest otherwise nor is there any exclusion removing such products from the Chapter. Hence from a plain reading of the Tariff Heading, squid liver powder being a preparation used for aqua feed and all type diet for animals, is rightly classifiable under CTH 2309. 7.3 W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d prepared animal feeding stuffs consisting of a mixture of several nutrients designed : (1) to provide the animal with a rational and balanced daily diet (complete feed); (2) to achieve a suitable daily diet by supplementing the basic farm-produced feed with organic or inorganic substances (supplementary feed); or (3) for use in making complete or supplementary feeds. The heading includes products of a kind used in animal feeding, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material, for example, in the case of products obtained from vegetable materials, those which have been treated to such an extent that the characteristic cellular structure of the original vegetable material is no longer recognisable under a microscope. (Emphasis added) (I) SWEETENED FORAGE . . . . . . . . (II) OTHER PREPARATIONS (A) PREPARATIONS DESIGNED TO PROVIDE THE ANIMAL WITH ALL THE NUTRIENT ELEMENTS REQUIRED TO ENSURE A RATIONAL AND BALANCED DAILY DIET (COMPLETE FEEDS) The characteristic feature of these preparations is that they contain products from each of the three ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers and which may consist either of one or more organic nutritive substances (manioc or soya 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. Provided they are of a kind used in animal feeding, this group also includes: (a) Preparations consisting of several mineral substances. (b) Preparations consisting of an active substance of the type described in (1) above with a carrier, for example products of the antibiotics manufacturing process obtained by simply drying the mass, i.e. the entire contents of the fermentation vessel (essentially mycelium, the culture medium and the antibiotic). The resulting dry substance, whether or not standardised by adding organic or inorganic substances, has an antibiotic content ranging generally between 8 % and 16 % and is used as basic material in preparing, in particular, pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs Tariff the classification of squid liver powder under 2309 also satisfies the relevant notes (A) and (C) of II Other Preparations given in the HSN, extracted above. Hence squid liver powder merit classification under the CTH 2309. Since the product is described as being a high-quality feed ingredient for aqua feed and all type diet for animals, the product which is not for exclusive use for fish, prawn etc. has been correctly classified under CTH 23099090. 9. The appellants have stated that addition of soya bean to the extent of 40% does not detract from the fact that the product is recognized in the trade as squid liver powder. When it comes to classification of such mixtures, reliance should be placed on Rule 3(b) of General Rules of Interpretation of the Tariff (GRI) as the impugned goods are a mixture and it should be classified applying its essential character. We find that normally goods should be correctly classifiable by reference to Rule 1 alone. Only if results of this process are ambiguous and two or more Headings appear to be applicable, then Rule 3 need be applied. Hence Rule 3 of GIR shall be used only if classification under Rule 1 and 2 fail. The iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity has given a reasoned order for his decision and the classification has not been done in an arbitrary or capricious manner. Hence on its own this ground cannot be treated as valid for setting aside the order of the lower authority. 10. We now take up the various case laws submitted by both the appellants. M/s. Avanti Feeds Ltd. have referred to the following judgments in support of their stand that there is no estoppel from the appellant taking a different view from that in the approved classification list. (a) Elson Machines Pvt. Ltd. Vs. Collector of Central Excise 1988 (38) ELT 571 (SC) (b) Madras Rubber Factory Ltd., Madras Vs. Superintendent of Central Excise, Madras and Others 1986 (24) ELT 273 (Mad.) (c) Plasmac Machine Mfg. Co. Pvt. Ltd. Vs. Collector of Central Excise 1991 (51) ELT 161 (SC) They have further referred to the following decisions stating that test reports which were not given to the appellant up to the SCN stage cannot be relied upon in the Order in Original. (a) Hindustan Fibres Ltd. Vs. CCE, Jaipur 2009 (245) ELT 337 (Tri. De.) (b) Bee-Am Chemicals Ltd. Vs. CCE, Raigad 2004 (167) ELT 534 (Tri. Mum.) (c) Essma W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discharged this duty effectively and that the discussions made in the impugned orders show the correct classification of goods under CTH 2309. They further relied upon the following judgments / decisions:- (a) Marsons Fan Industries Vs. CCE 2008 (225) ELT 334 (SC) (b) Commissioner of Customs Vs. Viraj Impex Ltd. 2017 (346) ELT 188 (Bom.) (c) Viacom 18 Media Pvt. Ltd. Vs. State of Maharashtra 2019 (22) GSTL 338 (Bom.) (d) Popular Carbonic Pvt. Ltd. Vs. CCE 2021 (8) TMI 240 CESTAT Chennai (e) Hi-Tech Corporation Vs. Commissioner of Customs 2021 (8) TMI 1214 CESTAT Chennai in furtherance of their stand that department has accepted the classification for imports and a different stand cannot be taken for subsequent imports. The issue has been examined and discussed in para 9.1 above and we are unable to agree with the submissions made by the appellants in the light of the judgments of the Hon'ble Supreme Court cited therein. 12. In the light of the discussions above, we find that the classification of the Squid Liver Powder has been correctly done under CTH 23099090 and hence the impugned orders are upheld. The appeals stand rejected. We hen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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