2021 (7) TMI 535 - AAR - GST

Classification of goods - rate of tax - Jackfruit Chips - Banana Chips - Sharkara Varatty - Halwa - Tapioca Chips - Potato Chips - roasted / salted / roasted and salted preparations of Ground nuts, Cashew nut and other seeds. HELD THAT - Chapter 21 of the Customs Tariff covers Miscellaneous edible preparations . The Heading 2106 of the Chapter 21 covers food preparations not elsewhere specified or included. Those food preparations, not specified or included elsewhere in the tariff being preparations for use either directly or after processing for human consumption are to be classified under this head. Therefore, it is evident that the entry is a residuary entry in respect of edible preparations and hence the edible preparations shall be classified under this entry only if the same are not classifiable under any of the other specific entries for edible preparations - Explanation appended to the Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017 clarifies that the rules for interpretation of the First Schedule of the Customs Tariff Act, 1975 including the Section and Chapter Notes and the General Explanatory Notes are applicable for interpretation of the GST Tariff / Rate Schedule. All the products other than Halwa - fall under the category of Namkeens classifiable under Customs Tariff Heading 2106 90, liable to GST at the rate of 5 % as per entry at SI Nos. 101 and 101A of Schedule I of N/N. 01/2017 Central Tax (Rate) dated 28.06.2017? - HELD THAT - Applying the principles of interpretation in Rule 2 of the General Rules for Interpretation of the First Schedule to the Customs Tariff Act, 1975 the Jackfruit Chips, Banana Chips, Sharkara Varatty, Tapoica Chips and Potato Chips (Whether salted/ masala or otherwise) are classifiable under Tariff Heading 2008 19 40 of the Customs Tariff Act, 1975. Regarding classification of roasted /salted / roasted and salted Cashew nuts, Ground nuts and other nuts there are specific headings under Chapter 20 that covers the products. Accordingly, roasted /salted / roasted and salted Cashew nuts are classifiable under Tariff Heading 2008 19 10 and other roasted /salted / roasted and salted nuts and seeds are classifiable under 2008 19 20 of the Customs Tariff Act, 1975. Halwa - fall under the category of Sweetmeat or otherwise - HELD THAT - The product Halwa being prepared using maida and sugar is a sweetmeat and is appropriately classifiable under Customs Tariff Heading 2106 90 99. Rate of GST - HELD THAT - It is evident that all the products that fall under Chapter Heading 2008 of the Customs Tariff Act, 1975 attract GST at the rate of 12 %. In respect of Halwa that falls under Customs Tariff Heading 2106 90 99 it is seen that there is an entry at SI No. 101 of Schedule I of N/N. 01/2017 - Central Tax (Rate) dated 28.06.2017 as per which all sweetmeats falling under Tariff Item 2106 90 attract 5% GST.

Summary

Issues Involved:
1. Classification and taxability of Jackfruit Chips, Banana Chips, and Banana Chips (masala) sold without a brand name.
2. Classification and taxability of Sharkara Varatty and Halwa sold without a brand name.
3. Classification and taxability of roasted and salted/salted/roasted preparations of Ground nuts, Cashew nuts, and other seeds sold without a brand name.
4. Classification and taxability of salted and masala chips of Potato and Tapioca sold without a brand name.

Issue-wise Detailed Analysis:

1. Classification and Taxability of Jackfruit Chips, Banana Chips, and Banana Chips (masala) Sold Without Brand Name:
The applicant contended that these products should be classified as "Namkeens" under HSN Code 2106.90.99 and taxed at 5% GST. However, the ruling determined that Jackfruit Chips and Banana Chips are classifiable under Customs Tariff Heading 2008.19.40, which covers "Other roasted and fried vegetable products." Consequently, these items are liable to GST at the rate of 12% [6% CGST + 6% SGST] as per Entry 40 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017.

2. Classification and Taxability of Sharkara Varatty and Halwa Sold Without Brand Name:
The applicant argued that Sharkara Varatty and Halwa should be classified as "Sweetmeats" under HSN Code 2106.90.99 and taxed at 5% GST. The ruling concluded that Sharkara Varatty is classifiable under Customs Tariff Heading 2008.19.40 and liable to 12% GST. Halwa, on the other hand, is classified under Customs Tariff Heading 2106.90.99 and is liable to 5% GST [2.5%-CGST + 2.5% - SGST] as per SI No. 101 of Schedule I of Notification No. 01/2017 - Central Tax (Rate) dated 28.06.2017.

3. Classification and Taxability of Roasted and Salted/Salted/Roasted Preparations of Ground Nuts, Cashew Nuts, and Other Seeds Sold Without Brand Name:
The applicant claimed these should be classified as "Namkeens" under HSN Code 2106.90.99 and taxed at 5% GST. The ruling clarified that roasted/salted/roasted and salted Cashew nuts are classifiable under Customs Tariff Heading 2008.19.10, while roasted/salted/roasted and salted Ground nuts and other nuts are classifiable under Customs Tariff Heading 2008.19.20. Both categories are liable to GST at the rate of 12% [6% CGST + 6% SGST] as per Entry 40 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017.

4. Classification and Taxability of Salted and Masala Chips of Potato and Tapioca Sold Without Brand Name:
The applicant argued that these products should be classified as "Namkeens" under HSN Code 2106.90.99 and taxed at 5% GST. The ruling determined that salted and masala chips of Potato and Tapioca are classifiable under Customs Tariff Heading 2008.19.40 and are liable to GST at the rate of 12% [6% CGST + 6% SGST] as per Entry 40 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017.

Conclusion:
The ruling comprehensively analyzed each product's classification under the Customs Tariff Act and determined the applicable GST rates. The products Jackfruit Chips, Banana Chips, Sharkara Varatty, Tapioca Chips, and Potato Chips are classified under Heading 2008 and taxed at 12% GST. Halwa is classified under Heading 2106.90.99 and taxed at 5% GST. The ruling emphasized the importance of specific classification under the Customs Tariff Act for determining the correct GST rates.