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Issues: Classification of cocoa butter under Indian Customs Tariff
Analysis: The central issue in this case revolves around the classification of cocoa butter under the Indian Customs Tariff. The dispute arises between the Custom House's classification of the goods under Item 21(2) and the petitioners' claim for classification under Item 15(6) of the ICT. The judgment delves into the characteristics of cocoa butter, describing it as a yellowish-white solid with specific properties such as being insoluble in water, soluble in alcohols, and having low toxicity. The Customs Cooperation Council Nomenclature defines cocoa butter as fatty matter obtained from cocoa beans, solid at normal temperature, and commonly used in chocolate making and confectionery. On the other hand, vegetable non-essential oils are edible oils extracted from plant seeds, characterized by mixed glycerides and non-toxicity. Despite cocoa butter's vegetable origin and non-essential nature, the Government distinguishes it from vegetable oils based on its solid form at ambient temperature and slightly higher melting point compared to typical oils. Regarding the classification under Item 21(2) of the ICT as "all sorts of food not otherwise specified," the judgment references the absence of a specific definition of 'food' in the Indian Customs Tariff but draws from the Prevention of Food Adulteration Act's definition. Cocoa butter, used in the composition of chocolate, aligns with the Act's definition of food as any article for human consumption or used in food preparation. The judgment also cites a Supreme Court judgment emphasizing the broad interpretation of 'food' to encompass items consumed for nourishment or taste. The Government's observation highlights Section IV of the Indian Customs Tariff, which covers products of the food preparing industry, including condiments and flavoring concentrates. The judgment notes that items not directly consumable, like flavoring concentrates, are classified under Section IV, indicating that direct consumption is not a prerequisite for classification as a food item. Moreover, the classification under the Customs Cooperation Council Nomenclature places cocoa preparations, including cocoa butter, under Section IV, reinforcing the classification of cocoa butter as a food item. Ultimately, the Government concludes that cocoa butter falls under the category of 'all sorts of food not elsewhere specified' and is classifiable under Item 21(2) of the Indian Customs Tariff. The appellate order upholding this classification is deemed legally correct, leading to the rejection of the revision application.
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