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TMI Blog2020 (8) TMI 102X X X X Extracts X X X X X X X X Extracts X X X X ..... -12-2018. The disputed product (classifiable under chapter sub-heading number 2301.10.90) attracts GST rate of 5% (2.5 % CGST + 2.5% SGST) under sl. No. 103 of the Schedule-1 of the Not. No. 01/2017-CT (R), dated 28.06.2017 (as amended). Poultry fat - HELD THAT:- The said product emanates as a by-product during the process of chicken remnants for manufacture of the primary product viz., poultry meal . It is noticed that Schedule to the Customs Tariff has two entries covering the said product - Tariff Heading No. 0209 covers poultry fat not rendered/otherwise extracted and Tariff Heading No. 1501 covers poultry fat other than that of Tariff Heading No. 0209. In the case on hand, the applicant submitted that the poultry fat supplied by them is extracted as a by-product during the process of their main product poultry meal . As such we opine that the product poultry fat supplied by the applicant merits to be classified under Tariff item No. 1501 90 00. The product poultry meal manufactured and supplied by the applicant attracts GST rate of 5% in terms of Not. No. 01/2017-CT (R) dated 28.06.2017 (as amended). - A.R.Com/28/2018, TSAAR Order No.04/2020 - - - Dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ners in twin cities and other parts of Telangana State. d. The manufacturing process was detailed as below: (i) The poultry offal is dumped in to the batch cookers through screw conveyer, Cooker operator cook for 30 minutes and dry the resulting for 4 hours in same cooker, then the resulting material is put in storage bins which is in the semi-finished stage. (ii) The semi-finished product contains a high level of fat which will be separated by using a fat press/screw press. Poultry meal coming from screw press will be sent to the hammer mill for making size reductions and then it is passed through a sieve. (iii) The supplement is sent to a blender where anti-oxidants are added to prevent the supplement from oxidation. The supplement is then is packed in HDPE bags and stored for sale. Final product is in brown color. The product contains Minerals, proteins and amino acids and is used as one of the raw ingredients by animal/aqua feed manufactures. It is not fit for human consumption. (iv) The fat oil collected in above process may contain some residual solid particles which is to be separated by filter with filter press. Filtered raw oil which contains a higher leve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... product which comes under the category of protein concentrates , used as an ingredient for compound animal feed, fish feed. The rational reason for defining it as concentrate comes from the process as how poultry meal is produced. In the process of production of poultry meal where the poultry waste like heads, legs, intestine and feathers are pressure cooked and dried under very high temperature, whereby if we use the raw material of chicken wastage of 1000 kilograms,(i.e., legs, heads, intestine and feathers) then the same is further concentrated with the process as briefed above and the output of that process is the final product called poultry meal which will be around 250 to 300 kilos depending on the quality of chicken wastage. The product of poultry meal is produced by concentration of the soft poultry waste offal such as intestine, heads, legs, feathers using the process as explained with the removal of water and moisture the same is placed as concentrate for compound animal feed, fish feed (prawns etc.,) which is as per HSN code 2309 2090 Compounded animal feed is a mixture of product of vegetable or animal origin in their natural state fresh or preserved or products ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied goods basing on their classification. Similarly Notification bearing No.02/2017-CT (Rate) dated 28.06.2017 was issued by the Government providing for exemption from tax in respect of goods listed there under. In terms of explanation (iii) and (iv) appended to these notifications, tariff heading, sub-heading, heading and chapter shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 and the rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975, including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall be applied for the interpretation and classification of goods. 8.3. Thus, while the rate notifications under GST law prescribe the rate of tax in respect of supply of goods and services, in order to interpret these notifications for the purposes of levy of GST, one has to read the same along with the first schedule (including the Section and Chapter Notes and General Explanatory Notes) of the Customs Tariff Act, 1975 ( Tariff ). 8.4. A perusal of the manufacturing process of poultry meal ,(furnished by the applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2301 is the other one which can accommodate the product manufactured by the applicant. The extract of the said chapter heading is as follows: Tariff Item Description of goods 2301 FLOURS, MEALS AND PELLETS, OF MEAT OR MEAT OFFAL, OF FISH OR OF CRUSTACEANS, MOLLUSCS OR OTHER AQUATIC INVERTEBRATES, UNFIT FOR HUMAN CONSUMPTION; GREAVES 2301 10 Flours, meals and pellets, of meat or meat offal; greaves : 2301 10 10 Meat meals and pellets (including tankage) 2301 10 90 Others (including greaves) As can be seen from the above, chapter heading No. 2301.10 covers Flours, meals and pellets, of meat or meat offal whereas sub-heading No. 2301.10.10 covers meat meals and pellets (including tankage). We opine that the product poultry meal manufactured by the assessee which is manufactured out of residue meat can be appropriately classifiable under Chapter sub-heading No. 2301 10 90 which covers the others category. 8.6. Further we find that entry No. 102 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 Other : 1501 Pig fats (including lard) and poultry fat, other than that of heading 0209or 1503 1501 10 00 Lard 1501 20 00 Other pig fat 1501 90 00 Other As can be seen from the above, Tariff Heading No. 0209 covers poultry fat not rendered/otherwise extracted and Tariff Heading No. 1501 covers poultry fat other than that of Tariff Heading No. 0209. In the case on hand, the applicant submitted that the poultry fat supplied by them is extracted as a by-product during the process of their main product poultry meal . As such we opine that the product poultry fat supplied by the applicant merits to be classified under Tariff item No. 1501 90 00. 8.9. Further, we notice that as per entry No. 19of Schedule-IIof Not. No. 01/2017-CT (R) dated 28.06.2017 (as amended), poultry fat attracts 12% GST (6% CGST + 6% SGST/UTGST). 8.10 . Accordingly we hold that the product poultry meal manufactured and supplied by the applicant attracts GST rate of 5% (2.5 % CGST + 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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