2017 (11) TMI 1512 - AT - Central Excise

Classification of goods - Cadbury Milk Treat - appellant claimed the classification under sub heading 1905.39 but the department has classified it under sub heading 1905.31 - Held that - identical issue has came up before the Tribunal in the case of Cadbury India Ltd. vs. CCE, Indore 2017 (6) TMI 310 - CESTAT NEW DELHI , where it was held that the ingredients used in manufacturing of Milk Treat does not contained any Cocoa or Chocolate but only contained Cocoa butter and Cocoa butter is specifically excluded and does not cover under Chapter 18 of the Central Excise Tariff Act, therefore, the White Chocolate cannot be said as Chocolate. The product Milk Treat is not covered under Tariff Heading 19053211. The product in question under sub heading 1905.39 has been correctly classified by the appellants - appeal allowed - decided in favor of appellant.

Summary

Issues: Classification of product under Tariff Heading 1905.39 or 1905.31

Analysis:
The appellant, engaged in manufacturing Cadbury Milk Treat, claimed classification under subheading 1905.39, while the department classified it under subheading 1905.31, leading to a demand for differential duty. The Tribunal considered the issue of classification by referring to the Tariff Headings 1905 and 1806. It was noted that wafers coated with or containing chocolate fall under Tariff Heading 1905.3211. The Tribunal highlighted the classification of chocolate under Chapter Heading 1806, emphasizing that cocoa butter cannot be considered as cocoa. The Tribunal referred to the explanatory notes of Chapter 18 and 17.04 to determine the classification of the product. It concluded that as the Milk Treat did not contain cocoa or chocolate but only cocoa butter, it could not be classified under Tariff Heading 1905.3211. Therefore, the product was correctly classified under Tariff Heading 1905.3219, leading to the setting aside of the impugned order and allowing the appeal.

Conclusion:
The Tribunal, after detailed analysis of the Tariff Headings and explanatory notes, classified the product Cadbury Milk Treat under Tariff Heading 1905.3219 instead of 1905.3211, as it did not contain cocoa or chocolate but only cocoa butter. The impugned order was set aside, and the appeal was allowed based on this classification.