2019 (11) TMI 109 - AAR - GST

Rate of GST - Peanut Candy - Gingelly Candy - Uniappam - Neyyappam - Kinnathappam - Kalathappam - Rice Ball (ariyunda) - Achappam - Kuzhalappam - Madakku - Pottlappam - Thatta/Thottavada - Murukku - Avil Vdayichathu - Baked Chips - HELD THAT - The Peanut candy and Gingelly candy are confectionery products made by heating a variety of sugars and thereby covered under HSN 1702. The Uniappam, Neyyappam, Kinnathappam, Kalathappam, Rice Ball (ariyunda) and Avil Vilayichathu are traditional sweet/snack of Kerala. It is deep fried fitters made with rice and jaggery Hence these items comes under the category of sweetmeats with HSN 2106 90 covered under Entry 101 of 1st schedule. The Achappam, Kuzhalappam, Madakku, Pottiappam, Thatta/Thattavada and Murukku etc are savouries having a salty or spicy flavour rather than a sweet one. Hence these items comes under the category of namkeens with HSN 2106 90? Therefore if the items are sold under trade / brand name, it will covered under Schedule II of Sl.No.46 and otherwise 101A of the 1st Schedule. The Baked Chips are come under HSN 2008 19 40 other roasted and fried vegetable products.

Summary

Issues:
1. Determination of GST rate for various traditional snacks.
2. Classification of snacks into different categories for GST purposes.

Analysis:
The applicant, a manufacturer of traditional snacks from Kerala, sought an advance ruling on the GST rates applicable to a variety of products. The products included Peanut Candy, Gingelly Candy, Uniappam, Neyyappam, Kinnathappam, Kalathappam, Rice Ball, Achappam, Kuzhalappam, Madakku, Pottlappam, Thatta/Thottavada, Murukku, Avil Vdayichathu, and Baked Chips. The products were classified into different categories based on their ingredients and flavors.

The Peanut Candy and Gingelly Candy were considered confectionery products falling under HSN 1702, and were ruled to be taxable at a 5% GST rate under Entry No.92 of the 1st Schedule. On the other hand, Uniappam, Neyyappam, Kinnathappam, Kalathappam, Rice Ball, and Avil Vilayichathu were categorized as traditional sweet/snacks of Kerala, classified as "sweetmeats" under HSN 2106 90, and taxed at a 5% GST rate under Entry No.101 of the 1st Schedule.

For items like Achappam, Kuzhalappam, Madakku, Pottiappam, Thatta/Thattavada, and Murukku, which were savory with a salty or spicy flavor, they were classified as "namkeens" under HSN 2106 90. The GST rate for these items varied based on whether they were sold under a brand name or not. If sold under a brand name, they were taxable at 12% under Entry 46 of the 2nd Schedule. If sold without a brand name or with voluntarily forgone rights, they were taxed at 5% under Entry No.101A of the 1st Schedule.

Lastly, Baked Chips were classified under HSN 2008 19 40 as "other roasted and fried vegetable products" and were taxed at a 12% GST rate under Entry 40 of the 2nd Schedule. The rulings provided clarity on the applicable GST rates for each category of traditional snacks based on their ingredients, flavors, and classification for taxation purposes.