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2023 (7) TMI 871 - AAR - GSTClassification of goods - rate of GST - Chikkies covered under sugar confectionery - Scope of Sugar Confectioneries - Sesame Chikkies - Amaranth Chikkies - Crushed Peanut Chikkies - Spirulina Chikkies - Dry Fruit Chikkies - Chocolate Peanut Chikkies - classifiable under chapter heading 1704 or under chapter heading 1806 90 20 - benefit of N/N. 1/2017-Central Tax (Rate) dated 18.06.2017. HELD THAT - It is observed on examination of the questions that the important and common ingredient in all of these products is jaggery, which is an unrefined natural sugar that is produced without adding any chemicals. Jaggery, like sugar, is made from sugarcane without separating the molasses. Thus jaggery broadly can be termed as a form of sugar - Sugar preparations which are marketed in a solid or semi-solid form generally suitable for immediate or direct consumption without further processing are collectively referred to as confectioneries. Chikkis, which are jiggery based preparations and are meant for direct consumption as snacks, are squarely covered under term Sugar Confectioneries. Classification of goods under Sugar Confectionery - HELD THAT - Chapter 17 of the Customs Tariff Act 1962 covers Sugars and Sugar Confectionery and chapter heading 1704 covers Sugar Confectionery (including white Chocolate) not containing cocoa. Thus all the sugar confectionery that do not contain cocoa are covered under heading 1704. In the instant case it is observed that the impugned products except Chocolate Peanut Chikkies do not contain cocoa and thus the products Sesame Chikkies, Amaranth Chikkies, Crushed Peanut Chickies, Spirulina Chikkies and Dry Fruit Chickies are squarely covered under Sugar Confectionery and thus fall under heading 1704. It is an admitted fact that the product Chocolate Peanut Chickies contain cocoa powder and thus the said product is not covered under Chapter 17. Cocoa and Cocoa Preparations are covered under Chapter 18; Chapter heading 1806 covers Chocolate and other food preparations containing cocoa and chapter heading 1806 90 20 covers Sugar Confectionery containing Cocoa. Thus the product Chocolate Peanut Chikkies that contains cocoa powder admittedly is covered under the chapter heading 1806 90 20. GST rates applicable on the impugned products - HELD THAT - The products i.e. various types of chikkies that are covered under chapter heading 1704 are exigible to GST @5%, in terms of entry number 92 to Schedule-I to the Notification No. 1/2017-Central Tax (Rate) dated 18.06.2017, as amended by the Notification 41/2017-Central Tax (Rate) dated 14.11.2017. Rate of GST applicable to the product Chocolate Peanut Chickies - HELD THAT - The impugned product being a Sugar Confectionery containing Cocoa is covered under chapter heading 1806 and is exigible to GST @ 18%, in terms of entry number 12C of the Schedule - III to the Notification No. 1/2017-Central Tax (Rate) dated 18.06.2017, as amended by the Notification 41/2017-Central Tax (Rate) dated 14.11.2017. The Dry Fruit Chikkies are classifiable under chapter heading 1704.
Issues:
The judgment involves the classification of various types of chikkies under the GST regime. Classification of Chikkies: The applicant sought advance ruling on the classification of different types of chikkies along with the applicable tax rates. The key ingredients of the chikkies were listed, and questions were raised regarding their classification under the HSN code and the applicable tax rates. The applicant contended that their products should be taxed at 5% GST and sought clarity on the classification of new chikkies like dry fruit chikkies and spirulina chikkies. Admissibility of the Application: The applicant claimed that the questions raised for advance rulings fell under the purview of "Classification of any goods or services or both," as per the CGST Act 2017, making the application admissible. Brief Facts of the Case: The applicant, a manufacturer of nutrition food products, intended to produce new varieties of chikkies and sought clarification on their classification and GST rates. The applicant's interpretation was that the chikkies should be taxed at 5% GST, based on specific notifications. Findings & Discussion: The Authority considered the submissions made by the applicant and observed that all the chikkies, except for "Chocolate Peanut Chikkies," fell under the category of Sugar Confectionery. The classification of the products was determined based on whether they contained cocoa or not. Chikkies not containing cocoa were classified under heading 1704, while those containing cocoa were classified under a different chapter. Ruling: 1. Chikkies falling under Sugar Confectionery were classified under chapter heading 1704 and taxed at 5% GST. 2. (a) Chikkies like Sesame, Amaranth, Crushed Peanut, Spirulina, and Dry Fruit were classified under Sugar Confectionery without cocoa and taxed at 5% GST. (b) Chocolate Peanut Chikkies, containing cocoa, were classified separately under a different chapter and taxed at 18% GST. 3. The classification of chikkies was based on whether they contained cocoa or not. 4. Dry Fruit Chikkies were classified under chapter heading 1704 as Sugar Confectionery without cocoa.
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