By TIOL News Service

MUMBAI, JAN 22, 2015: THE appellant imported products called "Pediasure, Ensure, Glucerna, Isomil and Prosure" and claimed the benefit of CVD exemption under Notification No. 02/2011-CE dated 01/03/2011 {vide Sl. No. 8 or 10 (i)} which covers "all kinds of food mixes, including instant food mixes" and "ready to eat packaged food", heading 2106.

The department took a view that the goods are not food mixes but food supplements having medicinal qualities containing "specific proteins, minerals and vitamins with sustained release of strength" and, therefore, denied the exemption and confirmed a differential duty demand of Rs.3.19 crores.

As their appeal was dismissed, the appellant is before the CESTAT.

It is submitted that they are not disputing their duty liability in respect of "Glucerna and Isomil" but are disputing the duty liability in respect of the other three products; that the product "Pediasure" imported by them is a complete and balanced 'nutritional product' designed to meet the nutrient needs of children 2-10 years of age. Similarly, in the case of the product called "Ensure" it consists of carbohydrates 54.3%, Fat 29.2%, Protein 14.8%, FOS 1.7% and the balance vitamins and minerals and is a complete balance nutritional product for early recovery from illness and provides all essential nutrients in the diet and can be used as a sole source of nutrition. Reliance is also placed on the decision in CCE, Ahmedabad Vs. Pioma Industries- 2006-TIOL-748-CESTAT-MUM wherein soft drink concentrate was held to be in the nature of instant food mixes.

The AR submitted that the goods under importation are meant for specific age categories and as per the literature, the indications for use of the products have been mentioned which clearly show that the products are to be consumed for specific medical conditions and, therefore, it cannot be considered as food mixes.

The Bench after perusing the literature distinguished the case law cited by the AR &observed -

"…The "Pediasure" is an instant food consisting of starch, sugar, oil, etc., with minor quantities of minerals and vitamins. The product "Ensure" is also a similar product mainly consisting of starch, sugar, protein with minor quantities of vitamins and minerals and this is for consumption by the elderly people, who need essential nutrition in their diet. The product is consumed by mixing them with water. From the product literature available, it is clearly seen that they are food mixes meant for different age group. The notification covers "all food mixes including the instant food mixes". The notification does not stipulate that it should be for consumption by all people or by all age groups…."

Holding that the products imported by the appellant falls within the category of food mixes and the appellant would be eligible for the benefit of Sr. 8 of the table of Notification No. 02/2011-CE dated 01/03/2011 in respect of CVD, the appeals were allowed with consequential relief.

In passing : Now for the duty liability in respect of Prosure, Glucerna, Isomil…and also see 2006-TIOL-718-CESTAT-MUM.

(See 2015-TIOL-170-CESTAT-MUM)