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2022 (1) TMI 187 - AAR - GSTClassification of goods - Non-Dairy Cream - to be covered under CH 1517 90 90 or under CH 2106 90 99 of the GST Tariff? - HELD THAT - The subject classification matter is pending as a dispute in proceedings initiated by the Directorate General GST Intelligence, Pune Regional Unit and therefore in view of the first provisio to Section 98 of the CGST Act, the question raised by the applicant is not answered. Application rejected being not maintainable.
Issues Involved:
1. Classification of 'Non-Dairy Cream' under GST Tariff: Whether it falls under CH 1517 90 90 or CH 2106 90 99. Issue-Wise Detailed Analysis: 1. Classification of 'Non-Dairy Cream' under GST Tariff: Applicant's Submissions: - The applicant, a manufacturer of various dairy and non-dairy products, has classified 'Non-Dairy Whipping Cream' (NDW Cream) under Central Excise Tariff Head 1517 90 90 due to its primary composition of vegetable fats. - The NDW Cream is used in bakery products as a topping or filling cream and is not consumed directly. - The classification under CH 1517 90 90 was accepted by Central Excise Authorities and GST Authorities without any dispute until the Directorate General GST Intelligence, Pune, raised an issue, suggesting reclassification under Tariff Head 2106. - The applicant argues that the reclassification is unjustified and based solely on another manufacturer's decision to settle a similar dispute under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. Applicant's Interpretation of Law: - The applicant contends that the settlement by M/s. RICH GRAVISS PVT LTD under the SVS Scheme cannot be grounds for reclassification of their product. - The Finance Act, 2019, Section 131, clarifies that the SVS Scheme's benefits are limited to the declarant and cannot be used to infer classification in other cases. Product's Composition and Manufacturing Process: - NDW Cream is an oil-in-water emulsion made from hydrogenated vegetable oils, sugars, emulsifiers, stabilizers, and water. - The manufacturing process involves emulsification, high-speed mixing, and homogenization to achieve stability and functionality. Classification by FSSAI: - The Food Safety and Standards Authority of India (FSSAI) classifies non-dairy creams under Food Category 2.3, which includes fat emulsions mainly of the oil-in-water type. - FSSAI's classification is considered equivalent to an expert's opinion and supports the applicant's classification under CH 1517 90 90. Classification under Customs and GST Tariff: - CH 1517 covers margarine and edible mixtures or preparations of animal or vegetable fats or oils obtained through emulsification. - The applicant's product fits this description, supporting its classification under CH 1517 90 90. - Conversely, CH 2106 covers food preparations not specified elsewhere, which does not apply to the applicant's product as it is already specified under CH 1517. Observations and Findings: - The applicant's submissions indicate an ongoing dispute with the Directorate General GST Intelligence, Pune, regarding the classification of NDW Cream. - Section 98 of the CGST Act, 2017, prohibits the Authority from admitting applications where the question raised is pending or decided in any proceedings under the Act. - Given the ongoing dispute, the Authority refrains from answering the classification question and rejects the application. Order: - The application is not maintainable under Section 98 of the CGST Act, 2017, due to the pending dispute, and is therefore rejected.
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