2024 (6) TMI 105 - AAR - GST

Classification of goods - Honey bee Feeds - to be classified under HSN 2309 9090 or not - rate of tax - HELD THAT - The description of the impugned product BEE-PRIME FEED specifies hat it is a premium nutritional supplement exclusively for bees and the same is a mixed supplementary feed. Further the Label specifies that the impugned product contains the ingredients of Vitamin C, niacin, vitamin B6 hydrochloride, vitamin B12, L-arginine, L-threonine, L-alcohol, L-alanine, L-histidine, L-serine, L-valine, Sodium chloride, potassium chloride, fructo-oligosaccharide, glucose, mixed with refined sugar. Therefore it is clearly evident from the said label that the predominant ingredient is refined sugar - the product, though is not a natural honey but is similar to it and hence it qualifies to be an artificial honey. In the instant case, it is an admitted fact that the impugned product has composition similar to that of the honey and thus the impugned product plays a role comparable to flower honey (natural honey) when water is added to the feed powder. Thus the impugned product merits classification under heading 1702.90, on the basis of specific description. Rate of tax - HELD THAT - In the instant case the impugned product merits classification under heading 1702 as artificial honey and thus attract GST rate of 18%.

Summary

Issues Involved: Classification of Honey bee feeds under HSN code, Rate of Tax applicable, and Other details for the specific product.

Classification of Honey Bee Feeds:
The applicant sought an advance ruling on the classification of their product, "Bee-Prime Feed," which is a honey bee feed containing various ingredients like refined sugar, natural vitamins, and nutrients. The product plays a role comparable to flower honey when mixed with water. The applicant claimed that their product should be classified under HSN 2309 9090 (Animal Feed) based on its characteristics and composition.

Rate of Tax Applicable:
The authority examined the classification of the product and determined that the impugned product, being similar to artificial honey, should be classified under heading 1702.90. As per entry No. 11 of Schedule III to Notification No. 1/2017-Central Tax (Rate), products falling under heading 1702, including artificial honey, attract an 18% GST rate. Therefore, the applicable rate of GST for the product "Bee-Prime Feed" is 18%.

Other Details for Specific Product:
The product "Bee-Prime Feed" was found to contain ingredients such as Vitamin C, niacin, various amino acids, and minerals mixed with refined sugar. The predominant ingredient in the product was identified as refined sugar, and it was noted that the product's composition resembled that of natural honey. The applicant provided a certificate of composition indicating the presence of essential components like L-Ascorbic acid, L-Arginine, and Dextrose Anhydrous, with Dextrose Anhydrous being a carrier material. The authority concluded that the product was produced with glucose and additives, justifying its classification under heading 1702.

Jurisdiction of the Authority:
The authority clarified that the question raised by the applicant regarding the classification and tax rate of the product falls outside the issues covered under Section 97(2) of the CGST Act 2017, stating that it is beyond the jurisdiction of the authority to address such matters.