9911796707
TMI Blog2021 (1) TMI 366X X X X Extracts X X X X X X X X Extracts X X X X ..... e. PAPAD is a thing entirely different and distinct from FRYUMS. Therefore, in common parlance or in market, Fryums are not sold as PAPAD instead of PAPAD sold as papad and Fryums are sold as Fryums. Both products are different and have their individual identity. Accordingly, in common parlance test, the applicant s product i.e. different shapes and sizes of Papad is not Papad but is Un-fried Fryums - the Un-fried Fryums are not classifiable as Papad under Tariff Item 1905 90 40. Appropriate classification of Unfried Fryums - HELD THAT:- Heading 2106 is an omnibus heading covering all kind of edible preparations, not elsewhere specified or included. Chapter Note 5 provides an inclusive definition of this heading and covers preparations for use either directly or after processing, for human consumption. Chapter Note 6 pertaining to Tariff Item 2106 90 99 also provides inclusive definition and products mentioned therein are illustrative only - the product different shapes and sizes un-fried Fryums is appropriately classifiable under Tariff Item 2106 90 99. Sl. No. 23 of Schedule III of Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017, as amended vide Notification No. 41/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rument, equipment, vehicle, aircraft, animal etc. The shape may vary, the size may vary but the ingredients, the proportion of ingredients, the composition and the recipe remains similar, if not exactly the same. 5. The applicant further submitted that they do not sell the Papad of different shapes and sizes manufactured by it in ready to eat condition. The applicant manufactures Papad of different shapes and size that are in neither fully cooked form nor ready to eat form till reaches the actual consumer. When the consumer desires to consume/ eat, the consumer needs to either fry it or bake it before consumption and upon frying/baking the Papad of different shapes and size sold by the applicant becomes consumable. In other words, the Papad of different shape and size are not ready and suitable for human consumption till they are fried/baked as deemed fit and as and when deemed fit by the consumer. 6. Accordingly the Applicant seeks Advance Ruling on the following questions : (i) Under which tariff Heading PAPAD of different shapes and sizes manufactured/ supplied by the applicant would attract CGST and SGST? Applicant's interpretation of law : 7. The applicant submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the case of State of Punjab Vs. Amritsar Beverages Ltd. - [2006] 147 STC 657 (SC) = 2006 (8) TMI 308 - SUPREME COURT, Honourable Supreme Court was confronted with the issue of interpretation of a couple of provisions of the Indian Evidence Act and while interpreting the provisions vis-à-vis taking cognizance of technological development, Honourable Supreme Court observed that - Creative interpretation had been resorted to by the court so as to achieve a balance between the age old and rigid laws on the one hand and the advanced technology, on the other. The judiciary always responds to the need of the changing scenario in regard to development of technologies. It uses its own interpretative principles to achieve a balance when Parliament has not responded to the need to amend the statute having regard to the developments in the field of science. In the case of M/s. J. K. Cotton Spinning and Weaving Mills Ltd. Vs. Union of India - [1988] 68 STC 421 (SC) = 1987 (10) TMI 51 - SUPREME COURT, relying upon the observation made by Apex Court itself in another judgment in the case of Senior Electric Inspector v. Laxminarayan Chopra [1962] 3 SCR 146 = 1961 (8) TMI 37 - SUPRE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the product in question was eligible to be classified as PAPAD under Tariff Heading 19050540. 16. The applicant submitted that issue as to whether PAPAD of different shapes and sizes and also known by different nomenclature, whereby more common nomenclature used is FRYUMS though FRYUMS is a registered brand name of TTK Healthcare Ltd. and not the name of any of product of PAPAD, would be eligible to be considered as and falling under the entry of PAPAD or not has been very well settled far back by Honourable Supreme Court in the case of Shiv Shakti Gold Finger Vs. Assisstant Commissioner, Commercial Tax, Jaipur - (1996) 9 SCC 514 = 1996 (5) TMI 419 - SUPREME COURT wherein Honourable Supreme Court has clearly observed and held that irrespective of the shape of PAPAD and irrespective of ingredients used, the PAPAD still remains PAPAD. 17. The applicant has referred the various case laws of VAT era which are summarised as under : (i) In the case of State of Karnataka Vs. Vasavamba Stores - [2013] 60 VST 19 (Karn.) = 2012 (10) TMI 977 - KARNATAKA HIGH COURT, Honourable Karnataka High Court has clearly dealt with the issue whether Fryums in an uncooked/unfried form sold would q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emands that the said judgment be honoured and followed. The applicant has rely upon the observation made by Honourable Supreme Court in the case of Collector of Customs, Bombay Vs. Krishna Sales (P) Ltd. - AIR 1994 SC 1239 = 1993 (9) TMI 124 - SUPREME COURT observing that - Mere filing of appeal does not operate as a stay or suspension of the order appealed against. (vi) On the issue of classification and the principles of classification, it would be profitable to refer to the decision of Honourable Supreme Court in the case of Commissioner of Commercial Tax, UP Vs. A. R. Thermosets (P) Ltd. - AIR 2016 SC 321 : (2016) 94 VST 258 (SC) = 2016 (9) TMI 410 - SUPREME COURT wherein, issue was as to whether BITUMEN EMULSION was eligible to be classified under the entry which read as BITUMEN. The stand of the Revenue was that the concerned entry was restrictive as it used the only word "BITUMEN" while the stand of the assessee was that BITUMEN EMULSION is a different form of BITUMEN, more precisely in liquid form and less hazardous. So, assessee contended it to be classified under the entry of BITUMEN. Therein Honourable Supreme Court held that narrow interpretation as sought by Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions and this helps in the development of the law. Besides providing guidelines for individuals as to what would be the consequences if he chooses the legal action, the doctrine promotes confidence of the people in the system of the judicial administration. Even otherwise it is an imperative necessity to avoid uncertainty, confusion. Judicial propriety and decorum demand that the law laid down by the highest Court of the land must be given effect to. Union of India (UOI) and Ors. vs. S.P. Sharma and Ors. (2014) 6 SCC 351: MANU/SC/0191/2014 = 2014 (3) TMI 1165 - SUPREME COURT. 18. The applicant further submitted that assessee is the person who deals with the product day in day out and who is more conversant with the market. The disturbance in the classification may lead to an anomalous situation for the assessee having business throughout the country. Considering the settled laws on the issue of classification it needs to be appreciated that it is very well settled position of law that in the case of classification, the entry most beneficial to the assessee needs to be adopted. The applicant relied upon the decision of Hon'ble Supreme Court in the case of Commissioner of Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of this notification." 24. What is 'Papad' has not been defined or clarified under Customs Tariff Act, 1975, the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the 'CGST Act, 2017), the Gujarat Goods and Services Tax Act, 2017 (hereinafter referred to as the 'GGST Act, 2017'), Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as the IGST Act, 2017 or the Notifications issued under the CGST Act, 2017/GGST Act, 2017/IGST Act, 2017. 24.1 It is now well settled principle of interpretation of statute that the word not defined in the statute must be construed in its popular sense, meaning 'that sense which people conversant with the subject matter with which the statute is dealing would attribute to it'. It is to be construed as understood in common language. In the case of Indo International Industries v. Commissioner of Sales Tax, U.P. [1981 (8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f exemption notification under Central Excise regime was examined by the Hon'ble Customs, Excise and Gold Appellate Tribunal (CEGAT, as it was known then) in the case of T.T.K. Pharma Ltd. v. Collector of Central Excise [1993 (63) E.L.T. 446 (Tribunal)] = 1992 (8) TMI 183 - CEGAT, NEW DELHI. In this case, the Hon'ble Tribunal, inter alia, observed as follows:- 6. A reading of these sub-headings makes it clear that the product is not a Prasad or Prasadam, Sterilised or pasteurised miltone. Therefore, it will not come within the sub-headings 2107.10 or 2107.20. As the item is not put in a unit container and ordinarily intended for sale, it will not come within the Heading 2107.91. Therefore, the product has to be brought under the residuary sub-heading 2107.99 as 'Other' carrying nil rate of duty. As we have classified the product under the residuary product under the heading "Edible preparations not elsewhere specified or included which carries nil rate of duty, the question of raising any demand or of Excise duty may not arise. However, as arguments have been adduced with regard to the Notification No. 12/90, dated 20-3-1990, it would be proper for us to give finding in regard to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 958/M.P. Commercial Tax Act, 1994. In this case, Hon'ble Apex Court observed as follows: - "12. In the present case we have quoted the definition of the term 'cooked food'. It is an inclusive definition. It includes sweets, batasha, mishri, shrikhand, rabari, doodhpak, tea and coffee but excludes ice-cream, kulfi, ice-candy, cakes, pastries, biscuits, chocolates, toffees, lozenges and mawa. That the item 'cooked food' is inclusive definition which indicates by illustration what the legislatures intended to mean when it has used the term 'cooked food'. Reading of the above inclusive part of the definition shows that only consumables are sought to be included in the term 'cooked food'. In the case of 'fryums' there is no dispute that the dough/base is a semi-food. There is also no doubt that in the case of 'fryums' a further cooking process was required. It is not in dispute that the 'fryums' came in plastic bags. These 'fryums' were required to be fried depending on the taste of the consumer. In the circumstances we are of the view that 'fryums' were like seviyan. 'Fryums' were required to be fried in edible oil. That oil had to be heated. There was certain process required to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the matter under Rajasthan Sales Tax Act, whether 'Gol Papad' manufactured out of Maida, Salt and Starch are Papad or not. It was held that size or shape is irrelevant and that Papad of all shapes and sizes are covered under the entry 'Papad'. 28.2 However, in the case of Shivshakti Gold Finger, Hon'ble Supreme Court has not examined the issue of 'Un-fried Fryums'. Therefore, the said case is not found to be applicable in the facts of the present case. 29.1 The applicant has also relied upon the judgement of Hon'ble High Court of Karnataka in the case of State of Karnataka v. Visavamba Stores and Others = 2012 (10) TMI 977 - KARNATAKA HIGH COURT, wherein the issue involved was whether the Fryums can be treated as Pappad under Entry 40 of the I Schedule to the KVAT Act. 29.2 The State of Karnataka has filed Special Leave Petitions (C) No. 29023-29083/2013 in the Hon'ble Supreme Court against the said judgment of Hon'ble High Court of Karnataka. The Hon'ble Supreme Court has granted leave to the said Special Leave Petitions. Therefore, the aforesaid judgment of the Hon'ble Karnataka High Court is in jeopardy, in view of the judgment of Hon'ble Supreme Court in the case of Union of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Therefore, this case law is not applicable in the instance case. 31. Therefore, the 'Un-fried Fryums' are not classifiable as 'Papad' under Tariff Item 1905 90 40. 31.1 The next issue which arises for consideration is appropriate classification of 'Unfried Fryums'. 31.2 Chapter Heading 2106 of the First Schedule to the Customs Tariff Act, 1975 is, as follows :- HS Code Description of goods Unit (1) (2) (3) 2106 Food preparations not elsewhere specified or included 2106 10 00 - Protein concentrates and textured protein substances kg. 2106 90 -Other : ---Soft drink concentrates : 2106 90 11 ----Sharbat kg. 2106 90 19 ----Other kg. 2106 90 20 ---Pan masala kg. 2106 90 30 ---Betel nut product known as "Supari" kg. 2106 90 40 ---Sugar-syrups containing added flavouring or colouring matter, not elsewhere specified or included; lactose syrup; glucose syrup and malto dextrin syrup kg. 2106 90 50 ---Compound preparations for making non-alcoholic beverages kg. 2106 90 60 ---Food flavouring material kg. 2106 90 70 ---Churna for pan kg. 2106 90 80 ---Custard powder kg. ---Other 2106 90 91 ----Diabetic foods kg. 2106 90 92 ----Sterilized or p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification No. 1/2017-State Tax (Rate), dated 30-6-2017, as amended, issued under the GGST Act, 2017 or IGST Act, 2017. 33. We also refer to the following Rulings of Advance Authority, which are squarely applicable in the instant case: (i) Gujarat Advance Authority in case of M/s. Sonal Product G {Advance Ruling No. GUJ/GAAR/R/2019/03, dated 22-2-2019 = 2019 (3) TMI 930 - AUTHORITY FOR ADVANCE RULING, GUJARAT} has held that, "Papad and Papad Pipes - Classification of - Products commonly known as unfried Fryums having different shape, sizes and varieties and made from raw materials such as maida floor, starch powder, rice powder, poha, salt, soda by-carb, baking powder, food colour, water and plastic bags for packing - Word 'Papad' not defined either under Customs Tariff or under Central Goods and Services Tax Act, 2017/Gujarat Goods and Services Tax Act, 2017/Integrated Goods and Services Tax Act, 2017 or Notifications issued thereunder, therefore, its meaning to be construed in its popular sense as understood in common language - The product is commonly known as 'namkeen' and not as 'papad' and appropriately classifiable under Tariff Item 2106 90 99 of Customs Tariff Act, 197 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
