Circular No.
81/2002-Customs
F.No.528/87/2001-CUS (TU)
Government of India
Ministry of Finance & Company
Affairs
Department of Revenue
(Tariff Unit)
Subject : Classification of Plan Stearin. - Reg.
I am directed to refer to the subject
mentioned above and to say that a doubt has been raised as to whether palm
stearine is classifiable under CTH 15.11 or 38.23 of the Customs Tariff. It has been reported that palm stearine,
which is a fraction of palm oil, is being classified under heading 15.11 of the
Customs Tariff at some ports and under 38.23 at others.
2.
Heading 15.11 covers palm oil and its fractions, whether or not refined,
but not chemically modified. According to HSN Explanatory Notes, Chapter 15
covers vegetable or animal fats and oils and their fractions whether used as
foodstuffs or for technical or industrial purposes (e.g., the manufacture of
soap, candles, lubricants, varnishes or paints). Headings 15.07 to 15.15 of this Chapter cover the
single (i.e., not mixed with fats or oils of another nature), fixed vegetable
fats and oils mentioned in the headings, together with their fractions, whether
or not refined, but not chemically modified. HSN Notes further say that fatty acids
are excluded from chapter 15.
3.
Heading 38.23, interalia, covers industrial monocarboxylic fatty acids
and acid oils from refining. Sub
heading 3823.11 covers stearic acid and 3823.12 covers oleic acid. The HSN Explanatory Notes further say
that heading 38.23 includes, inter alia, commercial stearic acid (stearin) which
is a white solid material with a characteristic odour. It is relatively hard and rather brittle
and is usually marketed in the form of beads, flakes or powder. It is also marketed in liquid form when
transported hot in isothermal tanks.
4. The matter
was referred to CRCL for opinion.
CRCL has advised that heading 15.11 covers palm oil and its fractions.
Palm oil is composed mainly of triglycerides of fatty acids such as palmitic,
strearic, oleic, lauric, myristic, etc.
Palm oil can be separated into low and high melting point fractions,
viz., palm olein and palm stearin, by fractionation. Composition wise both
fractions are mainly triglycerides of fatty acids. Therefore, stearin (palm stearin)
falling under 15.11 is glyceride (ester) of fatty acids such as palmitic,
stearic, oleic, lauric, myristic etc.
As regards heading 38.23 which covers industrial monocarboxylic fatty
acids, the olein and stearin described thereunder are mixed fatty acids mainly
palmitic, stearic, oleic acid etc., obtained by splitting of natural fats and
oils by means of hydrolysis or saponification, and then by crystallisation and
separation. Industrial fatty acids are used in plastics, fibres, soaps,
surfactants etc. These are composed
of mixtures of fatty acids and are by no means pure or even fairly pure. Hence, they are classifiable under
heading 38.23. The fatty acids
having specified minimum purity levels are classified under Chapter 29.
5.
CRCL has further advised that `palm stearine' falling under heading 15.11
is basically triglyceride (Esters) of fatty acids and `stearine' falling under
heading 38.23 is basically a free fatty acid. The triglycerides of fatty acids
(Esters) and free fatty acids are two different organic compounds and
distinguishable by chemical tests i.e., by determining the ester value. While triglycerides possess the ester
values, free fatty acids do not possess the same.
6. It is
requested that goods declared as `palm stearin' or `crude palm stearin' may be
assessed keeping in view the above advice received from CRCL. The goods may be got chemically examined
to verify whether they are glycerides (ester) of fatty acids (15.11) or a
mixture of fatty acids (38.23).
7. Any
difficulty in implementing the above instructions may be brought to notice of
the Board.
Please acknowledge receipt of this Circular.
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