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TMI Blog2018 (10) TMI 1244X X X X Extracts X X X X X X X X Extracts X X X X ..... RITY FOR ADVANCE RULING - MAHARASTRA]. In this case this authority held that whole animal carcass in its natural shape in frozen state in different weight and size packed in LDPE bags without mentioning the weight and one or two such bags further packed in HDPE bags being supplied to Army against tender shall qualify as product put up in ‘unit container’. It was further held that impugned product will be covered by schedule entry 4 of the notification of 1/2017 - Integrated Tax (Rate) during the period 01/07/2017 to 13/11/2017 and schedule I of the said notification for the period from 14th November, 2017 onwards. It is required to examine whether the facts mentioned in respect of M/S Ahmednagar District Goat Rearing and Processing Cooperative Federation Limited as presented at the time of proceedings in that case, have any similarity with the facts of the present case. From the facts submitted by the applicant and ascertained and vetted by jurisdictional officer by paying visit to the factory we find that the facts of the present case are partly different from the facts in the case of M/s. Ahmednagar District Goat Rearing and Processing Co-operative Federation Ltd. - To summ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1st April, 2018 till present and continuing period. We therefore restrict ourselves to the entry as is applicable for the period from 1st April, 2018. The supply of whole sheep/ goat carcass in frozen state packed in LDPE bag and further packed in HDPE bag which do not indicate any information related to weight [number of the carcass packed in such bags would not be a product put up in a unit container for the purpose of notification 1/2017and 2/2017- Integrated Tax (Rate) dated 28th June 2017. As such impugned supply is covered by notification 2/2017 - Integrated Tax (Rate) dated 28th June, 2017 as amended by serial 9 Of the notification no. 44/2017 - Integrated Tax (Rate) dated 14th November, 2017 and would be exempt from whole of GST as per this Notification. Ruling:- The whole (Sheep/Goat) animal carcass in its natural shape in frozen state in different weight and size packed in LDPE bags without mentioning the weight and one or two such LDPE bags further packed in HDPE bags being supplied to Army by applicant against tender shall not qualify as product put up in “unit container”. The impugned product would be covered by notification 2/2017 - Integrated Tax (Rate) dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... my against tender. 2) Monrovia Agro Foods Supplies to Army Sheep / Goat meat in carcass form i.e. the whole animal carcass in its natural shape in frozen state. Naturally, the carcass would be in different weight sizes. Further, there is no fixed quantity size in which these carcasses are dispatched to Army. The said dispatches are made on the basis of the weight of the frozen carcass. Furthermore, the consideration is charged on the basis of weight. The packing and dispatch pattern is given below:- Each frozen carcass is put in LDPE Bag (Primary Packing) which is not sealed no weight is mentioned on such LDPE Bag, Thereafter, generally one or two of such LDPE Bags are put in HDPE Bag (Secondary Packing) and no weight is mentioned on such HOPE Bag too. Hence, the invoicing is done for entire weight of the lot and no mention of weight of each bag of the lot. i. (A copy of the marking appearing on LDP E Bag attached herewith as Annexure A-I) (General instructions as given by Army to supplier against tender attached herewith as Annexure A-II) 3) The Four digit HSN of the Subject Product is given below:- HSN Product ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t meat respectively are provided below: Schedule I S.No. Chapter/Heading/Sub-heading/Tariff item Description of Goods 1. 0204 All goods (other than fresh or chilled) and put up in unit container and,- (a) bearing a registered brand name; or (b) bearing a bmnd name on which actionable claim or enforceable right in court of law is available [Other than those where any actionable claim or enforceable right in respect of such brand name has been foregone voluntarily], subject to conditions as in the ANNEXURE I] ; b. Hence, net impact of the above amendment is as follows:- i. Reduction in rate from 12% to 5% on the subject products. ii. One additional condition for taxability is imposed i.e. product must be branded. c. Correspondingly, in exercise of the powers conferred by sub-section (1) of section 6 of the Integrated Goods and Service Tax Act, 2017, the Central Government via Notification No.44/2017-Integrated Tax (Rate) New Delhi dated 14.11.2017 has exempted inter-State supplies of goods from the who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nil 0204 50 00 - Meat of goats Nil 1601 00 00 SAUSAGES AND SIMILAR PRODUCTS, OF MEAT, MEAT OFFAL OR BLOOD; FOOD PREPARATIONS BASED ON THESE PRODUCTS 6% 0104 LIVE SHEEP AND GOATS 0104 10 - Sheep: 0104 10 10 - Sheep including lamb for breeding purpose 0104 10 90 - 0104 10 90 0104 20 00 - Goats (c) Details of benefit of notification of Central Excise if any availed - NA. (6) (a) Classification of Service / Services as applicable (b) Rate / Rates of Service Tax as applicable to services provided Sr. No. Classification of Services Accounting Code Rate of Tax 1. Manpower Recruitment/ Supply agency service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10. 0204 Meat of Sheep or goats, [other than frozen and put up in unit containers] 5. W.e.f 15 th November, 2017 onwards, Schedule I of the Notification No 43/2017-lntegrated Tax (Rate) dated 14th November 2017 deals with the products which are subject to 5 % GST and entry No 1 which pertain to sheep/Goat meat are provided below: Schedule I S.No. Chapter/Heading/ Sub-heading/Tariff item Description of Goods 1. 0202 All goods (Other than fresh or chilled) and put up in unit container and,- (a) bearing a registered brand name; or (b) bearing a brand name on which actionable claim or enforceable right in court of law is available [other than those where any actionable claim or enforceable right in respect of such brand name has been foregone voluntarily], subject to conditions as in the ANNEXURE I] ; 6. A reading of the above-mentioned entries would reveal that the item mentioned in Tariff Heading 0204 would be eligible to tax @ 5% if are put u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are being made for the kind consideration of the Honorable Advance Ruling Authority. 11. Unit Container, meaning- 11.1 Before adverting to the decided case laws and analysis of the term unit container , it is important to advert to the meaning of the term unit . Merriam Webster Dictionary defines unit as a determinate quantity (as of length, time, heat, or value) adopted as a standard of measurement such as an amount of work used in education in calculating student credits or an amount of a biologically active agent (such as a drug or antigen) required to produce a specific result. The Business Dictionary defines the term to mean a definitive or determinate quantity adopted as a standard of measurement and exchange. Therefore, where the term unit is affixed to a container, it would mean a container containing a unit of a particular commodity i.e. a determinate quantity of goods contained therein. It should be designed to contain such determinate quantity of units of goods. 11.2 In this background, let us analyses the meaning scope of the term unit container . 11.3 The interpretation of the expression unit container has been a vexed issue in the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d consumer satisfaction is the method of packing in unit containers . In most cases (if not all) the container is not returnable; in many cases it is not durable, particularly if it is of cardboard or aluminium foil. For obvious reasons the container has to be just large enough to hold the predetermined quantity of the contents. To pack half a litre of fruit syrup in a bottle which can hold one litre would not only be wasteful but would also subject the contents unnecessary movement, perhaps with a loss of quality. Further, it would arouse doubts in the customer that he is being cheated. It can therefore be very well understood that no intelligent manufacturer would pack prepared or preserved foods (or indeed any similar product of common consumer use) in a container which is not full or practically so. Nor would a prudent customer readily buy a product in a container which does not appear to be full. 46. The above observations on the methods of marketing of common consumer products, do not require any special knowledge because they are a matter of common experience. The tariff item and the Finance Ministry s instructions are consistent with the general experience and practic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roducts v/s Collector of Central Excise, Raipur, 1995 (76) E.LT. 393 (Tribunal) =1995 (1) TMI 155 - CEGAT, NEW DELHI , held that jerry cans of tomato puree of 35 litre capacity being supplied to manufacturers of tomato ketchup was not a unit container . 11.12 However, in the case of CCE v Simba Chips, 1997 (96) E.L.T. 381 (Tribunal) = 1997 (7) TMI 330 - CEGAT, MUMBAI , the Tribunal held that the fact that packets did not bear indication of the weight of the goods has no significance to determine whether it is a unit container or not so long as the packet contained a predetermined quantity. 11.13 Therefore, the fact that that containers did not bear indication of weight of goods is no significance to determine if a container is a unit container or not so long as the said container contained a predetermined quantity. 11.14 In the context of HDPE and LDPE Bags, in the case of Surya Agro Oils Ltd. v. Commissioner of Central Excise, Indore, 2000 (116) E.L.T. 514 = 1999 (11) TMI 264 - CEGAT, NEW DELHI , the question arose whether an HDPE sack weighing 20 kg each of Pasta was a unit container or not. It is pertinent to note that the HDPE sack weighing 20kgs com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the manufacture, name of the manufacturer, trademark, price, etc. A big container designed to hold a pre-determined quantity of goods in bulk will also qualify as unit contained. (ii) That the sale of a product in big bags such LDPE and HDPE sacks cannot be said to be a sale of bulk in loose but would be a unit container where these bags contain pre-determined quantity of the product for sale to the distributor/customers. However, where such bags don t contain a pre-determined quantity, the same will not qualify as unit container. For instance in the case of CCE vs. Shalimar Super Foods [2007 (210) ELT 695 (Tri. - Mumbai) =2006 (11) TMI 56 - CESTAT, MUMBAI , the tribunal held that meat articles packed in loose plastic bags which were not in uniform quantities cannot be held to be a unit container. The bags in this case were not sealed similar to the LDPE bags in the present case, 13. In light of the above discussion, we are of the view that Mutton sold by Monrovia Agro Foods would not qualify as a unit container for the following reasons: (i) LDPE bags are not sealed. Even though the fact as to whether the bags are sealed or not is not decisive in determination ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic queries raised for Advance Ruling:- i. Whether the packaging being used for despatch to Army shall qualify as Unit Container under the GST law? Point of view:- ln light of the discussion contained in Para 11.1 to Para 11.12, we are of the view that despatches made by the supplier in LDPE/ H DPE bags i.e. both primary as well as secondary packing do not qualify as product packed in unit container. ii. Whether the product, i.e. sheep/Goat meat in frozen State and packed as mentioned in the facts stated above sheet shall be liable to be taxed under GST or would it be treated as exempted? Point of view: - In light of the discussion contained in Para 11.1 to Para 11.10, we are of the view that despatches made by the supplier in LOPE/ HDPE bags i.e. both primary as well as secondary will not be liable to tax under GST. 03. CONTENTION - AS PER THE CONCERNED OFFICER The submission, as reproduced verbatim, could be seen thus- Question 1: Whether the whole (Sheep/Goat) animal carcass in its natural shape in frozen state in different weight and size packed in LDPE bags without mentioning the weight and one or two such LOPE bags furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per entry no. 4 of schedule II of the Notification no. 1/2017-lntegrated Tax (Rate) dated 28th June 2017 up to 14th November 2017 and thereafter as per entry no. 1 of schedule I of the Notification No. 43/2017-lntegrated Tax (Rate) dated 14th November 2017 or fall under exemption list as per entry no 10 of Notification No. 2/2017-lntegrated Tax (Rate) New Delhi dated 28th June 2017 up to 14th November 2017 and thereafter as per entry no. 9 of the Notification No. 44/ 2017-lntegrated Tax (Rate) dated 14th November 2017. Comments : As per the submissions made by the tax payer it appears that they are supplying Sheep, Goat Meat in carcass form i.e. the whole animal in its natural shape in frozen state of different weights. The said products are packed in LDPE bags and then one or two LDPE bags are packed in one HDPE bag. As the packages differ in weight and quantity, no weight is mentioned on the LDPE or HDPE bags and invoicing is done on the entire weight of the lot. It appears that the product involved i.e. Frozen Sheep/Goat Meat is duly covered under HS Code 02043000 and Chapter Sub Heading 0204. As regarding the rate of tax applicable, reference is made to the Entry No: 4 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d storage instructions and a marking FOR DEFENCE SERVICE ONLY . There is no mention of weight/ quantity on the said Sticker. It is found that the said package was again packed in another LDPE bags without any markings. Photographs of a sample package and the sticker affixed on the said packages is attached herewith for reference. It was also made to understand that on receipt of order from the Army establishments, the goods are weighed on the weighing scale and dispatched in refrigerated vehicles under an Invoice showing the total weight, Rate and the total price. Copy of Invoice dated 30.12.2017 (wherein the Taxpayer has paid the tax @5%) and Invoice dated 15.07.2018 where in the goods were cleared at Nil rate are enclosed herewith for ready reference. b) It was also noticed that the Tax payer is also involved in the manufacture of Ready to cook Chicken products, Tray Pack Frozen Pre Cut Chicken Products and Ready to eat Canned Meat Products. The said goods are marketed and sold under a Brand Punjab Maratha in retail packs on which the tax payer is paying appropriate GST. The brochure, the packing and the stickers used for the packing are enclosed for ready reference. 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 2/2017 - Integrated Tax (Rate) both dated 28th June 2017and further amended by notification no 43/2017 and 44/2017- Integrated Tax (Rate) both dated 14th November, 2017 are the central point of discussion, In Short, if the impugned supply is covered by the description of goods as per notification no. 2/2017 - Integrated Tax (Rate) both dated 28th June, 2017 as amended by notification 44/2017 - Integrated Tax (Rate) both dated 14th November, 2017 then the said supply is exempt from whole of GST. Applicant submits that as per above notification goods are not put up in a unit container and are also not bearing a brand name and hence benefit of notification is available in their case. During the course of hearing the applicant as well as jurisdictional officer was informed that this authority has already given ruling on the same issue in case of M /S. Ahmednagar District Goat Rearing and Processing Co-operative Federation Ltd. bearing Order No. GST-ARA-21/2017-18/B-27, Mumbai dated 21/04/2018 = 2018 (5) TMI 1393 - AUTHORITY FOR ADVANCE RULING - MAHARASTRA . In this case this authority held that whole animal carcass in its natural shape in frozen state in different weight and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he intervening period (i.e. 2017-18) packing conditions mentioned in Terms and Conditions (i.e. RFP) given by Army required mentioning of actual weight on the Secondary packing. In the current tender against which supplies are being made presently (From April 2018) there is no requirement from Army side regarding mentioning of weight/ number on any packing material. It would be important to mention here that a specific letter received from Army that there is no requirement of mentioning the weight/ number of carcass packed already provided while filing written submission. Billing Pattern A list showing bag wise weight against each bill was being provided to Army as attachment with each invoices. There is no such list is either made or provided to Army the total weight is mentioned on the invoice and it is not even possible to figure it out the total number of bags in respective truck or weight of carcass/number put in any bag. Basis of Consideration The consideration is charged on the basis of weight of the meat supplied and number of carcass have no number of carcass hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Explanation - for the purpose of this schedule (Notification 1/2017 and 2/2017-lntergrated Tax (Rate) both dated 28th June, 2017 The phrase unit container means a package, whether large or small (for example, tin, can, box, jar, bottle, bag, or carton, drum, barrel, or canister) designed to hold a predetermined quantity or number, which is indicated on such packing. For the purpose of above definition, for a package to be called unit container has to satisfy follow conditions simultaneously- 1. Package may be large or small 2. Packaging designed to hold predetermined quantity or number 3. Such predetermined quantity or number is indicated on such package. From the facts submitted by the applicant and as verified by the jurisdictional officer during his factory visit, we find that each package is containing different weight and no weight/number is mentioned on packages. In view of above we are convinced that impugned supply would not satisfy the requirement of the definition of unit container as found in both the notifications sited supra. In view of this, we hold that the supply of whole sheep/ goat carcass in frozen state packed in LDPE bag and f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n unit container] 1-7-2017 TO 13-11-2017 NIL Deleted w.e.f 14.11.2017 9 0202, 0203, 0204, 0205, 0206, 0207, 0208, 0209, 0210 All goods [other than fresh or chilled], and put up in unit container and, - (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available (other than those where any actionable claim or enforceable right in respect of such brand name has been foregone voluntarily], subject to the conditions as in the ANNEXURE I] 14-11-2017 ONWARDS NIL The period relevant in respect of present application for Advance Ruling as stated by the applicant is from 1st April, 2018 till present and continuing period. We therefore restrict ourselves to the entry as is applicable for the period from 1st April, 2018. We have already held that the supply of whole sheep/ goat carcass in frozen state packed in LDPE bag and further packed in HDPE bag which do not indicate any information related to we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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