2021 (7) TMI 1365 - AAR - GST

Exemption from GST - Mango Pulp/puree - can be treated as fresh fruit or not - whether the mango pulp/puree falls under the heading 20079910 or 0804 or 2008? - rate of tax payable on outward supplies of Mango fruit pulp/puree under the GST Act - HELD THAT - In the instant case, the mangoes procured by the applicant are not marketed either in the same state or in frozen/chilled state of the same as fresh fruit. Hence, the entry under 0804 as claimed by the applicant is not applicable - It is evident from above that Headings 2007 and 2008 do not apply to the goods under discussion i.e., 'Mango Pulp/Puree' ,which are nothing but fruit pastes. Hence the claim of the applicant is non-applicable in the present context. The tariff rate of Mango Pulp had undergone changes over a period of time. As there is no specific entry under GST tariff meant for this product 'mango pulp/puree', the entry no. 453 of Schedule -III of Notification No. 1/2017-Central Tax (Rate) dt 28.06.2017 is applicable, which is a residuary entry covering goods which are not specified in Schedules I, II, IV, V, VI of the Notification, attracting the tax rate of 18%.

Summary

Issues:
1. Classification of Mango Pulp/puree and eligibility for tax exemption.
2. Determination of the tax rate applicable on outward supplies of Mango fruit pulp under the GST Act.

Issue 1: Classification of Mango Pulp/puree and eligibility for tax exemption:
The applicant contended that Mango Pulp should be treated as fresh fruit, thus exempt from tax. However, the authority clarified that the exemption under entry No.51 of 0804 only applies to fresh mangoes, not processed products like pulp. The authority analyzed the classification under Headings 2007 and 2008, concluding that Mango Pulp falls under fruit pastes, making the claimed exemption inapplicable. The recent tariff changes specified Mangoes sliced, dried at 5%, but remained silent on Mango Pulp. As there was no specific entry for Mango Pulp, it was classified under the residuary entry 453, attracting an 18% tax rate.

Issue 2: Determination of tax rate on outward supplies of Mango fruit pulp:
The ruling clarified that Mango Pulp/puree falls under entry no. 453 of Schedule-III of Notification No.1/2017-Central Tax (Rate) dt: 28.06.2017, subject to an 18% tax rate. The authority's decision was based on the absence of a specific entry for Mango Pulp in the GST tariff, leading to its classification under the residuary entry.

In conclusion, the authority ruled negatively on treating Mango Pulp as fresh fruit for tax exemption and determined an 18% tax rate on outward supplies of Mango fruit pulp under the GST Act. The detailed analysis considered relevant legal provisions, tariff classifications, and recent amendments to arrive at a comprehensive decision.