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TMI Blog2023 (1) TMI 978X X X X Extracts X X X X X X X X Extracts X X X X ..... n of facts, shall render such ruling to be void ab-initio in accordance with Section 104 of the Act. 5. The provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act. MADURAI FAMOUS JIGARTHANDA LLP, No.4/799, Thasildhar Nagar, Vandiyur, Madurai-625020 (hereinafter called the Applicant) are registered under GST with GSTIN:33ABMFM3879J1ZP. The applicant has sought Advance Ruling on the following questions: 1. Whether the product manufactured as pasteurized milk and milk cream but named "Jigarthanda" can be classified as Jigarthanda under description of goods? 2. Is the goods taxable or exempted? 3. If exempted, HSN of the product and rate of tax on product. 4. If taxable, HSN of the product and rate of tax on product. 1.2 The Applicant has submitted the copy of application in Form GST ARA - 01 and also submitted a copy of Challan evidencing payment of applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingredients used and manufacturing process of "JIGARTHANDA": They have stated that their products are sold under three flavours /key ingredients: i. Jigarthanda ii. Milk Kova with Jigarthanda iii. Basundhi ("Palaadai"-milk cream) 3.3 They have stated that their product is sold under the name "JIGARTHANDA", where it was named by their ancestor who had prepared JIGARTHANDA during their olden days. The manufacturing process involves the following steps: i. Receiving raw milk in silos ii. Pasteurization: Raw milk that has been heated to a specified temperature and time to kill pathogens that may be found in the raw milk (90°c for 10minutes) iii. Sugar Syrup Preparation: Sugar and nannari syrup are added in boiling water which is made to boil for some time to make the sugar syrup. This is for sweetening and flavoring the `Jigarthanda' iv. Milk cream (Basundhi-Paaladai) preparation: Pasteurized milk is boiled for collecting fresh milk cream. This process is done continuously for preparing basundhi-palaadai. v. Badam pisin: It is soaked for some time in clean water which will become as a suitable substance for further preparation of Jigarthanda vi. Chilling/te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ately as Basanthi with GST. 3.8 The Advocates in the written submission, inter alia, stated that Jigarthanda cannot be said as 'Beverage of Milk' as it is excluded as per the Explanatory Notes to Chapter 22 of HSN; the ratio of ingredients in Jigarthanda is Milk cream 50%, Badam Pisin 35% and Pasteurized milk added with sugar and nannari syrup 15%; since, Milk cream and Badam Pision are in solid consistency, pasteurized milk is added to make it semi solid; Sugar, Milk cream, Badam Pisin, Nannari and Milkkova attract 5% GST and Milk 0% GST are mixed toghther and served as Jigarthanda would qualify as 'mixed supply and attract 5% GST. Currently, 5% GST is being collected on 1. Jigarthanda, 2. Jigarthanda with Milkkova scoop and 3. Basundhi (Milk Cream - Paladai). 4. The Centre Jurisdictional Authority, Madurai Commissionerate, who has administrative jurisdiction over the applicant was addressed vide this office letter dated 22.04.2022 requiring to furnish comments on the issue raised by the applicant and report whether any proceedings are pending on the issue in respect of the applicant. The said authority has stated that no proceedings in the applicant's case on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gly, we hold that "Jigarthanda" is goods. 8.2 We next take up the classification of Jigarthanda. We find that the classification of goods under GST regime has to be done in accordance with the Customs Tariff Act, 1975, which in turn is based on Harmonized System of Nomenclature, popularly known as 'HSN'. The rules of interpretation, section notes and chapter notes as specified under the Customs Tariff Act, 1975 are also applicable for classification of Goods under GST regime. However, once an item is classified in accordance with the Customs Tariff Act, 1975, the rate of tax applicable would be arrived at on the basis of notifications issued under GST by the respective Governments. 8.3 The applicant has claimed that `Jigarthanda' is pasteurized milk with added sugar-nannari syrup, patham-pisin and milk cream (paladai) classifiable under HSN 0402 of Customs Tariff Act, 1975, which is reproduced below: 0402 MILK AND CREAM, CONCENTRATED OR CONTAINING ADDED SUGAR OR OTHER SWEETENING MATTER 040210 - In powder, granules or other solid forms, of a fat content, by weight not exceeding 1.5% : 04021010 --- Skimmed Milk 04021020 --- Milk food for babies 0402 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SN clearly state that beverages consisting of milk flavoured with cocoa or other substances is specifically excluded from this chapter heading. 8.5 The applicant categorically stated that their product "Jigarthanda" is not fermented milk, but pasteurized milk product. Therefore, classification of Jigarthanda under HSN 0403, which covers goods subjected to fermentation of milk, does not arise. 8.6 As the explanatory note of HSN 0402 does not cover beverages consisting of milk flavoured with cocoa or other substances covered under heading 22.02, the relevant chapter notes, tariff entry and HSN Explanatory note of HSN 2202 is given below to decide the appropriate HSN for Jigarthanda. 2202 - WATERS, INCLUDING MINERAL WATERS AND AERATED WATERS, CONTAINING ADDED SUGAR OR OTHER SWEETENING MATTER OR FLAVOURED, AND OTHER ALCOHOLIC BEVERAGES, NOT INCLUDING FRUIT OR VEGETABLE JUICES OF HEADING 2009 2202 10 90 Other Other: 2202 91 00 Non-alcoholic beer 2202 99 Other: 2202 99 10 Soya milk drinks, whether or not sweetened or flavoured 2202 99 20 Fruit pulp or fruit juice based dink 2202 99 30 Beverage conta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le III of the CGST Act, 2017 as non-supply nor exempted under Notification No.2/2017 CTR dated 28.06.2017. Therefore, it is a taxable goods covered under Notification No.1/2017 CTR dated 28.06.2017 vide serial No.50 of Schedule II as "Beverages containing milk" attracting CGST of 6% and attracting SGST of 6% vide serial No.50 of Schedule II of G.O. (Ms.) No. 62 dated 29.06.2077 for intra state supply. It attracts 12% IGST vide serial No.50 of Schedule II of Notification No.1/2017 Integrated Tax (Rate) dated 28.06.2017, for interstate supply. RULING 1. Whether the product manufactured as pasteurized milk and milk cream but named "Jigarthanda" can be classified as Jigarthanda under description of goods? "Jigarthanda" manufactured by the applicant is covered under the description of goods. 2. Is the goods taxable or exempted? "Jigarthanda" manufactured by the applicant is taxable goods. 3. If exempted, I-ISN of the product and rate of tax on product. "Jigarthanda" manufactured by the applicant is not exempted. 4. If taxable, HSN of the product and rate of tax on product. "Jigarthanda" manufactured by the applicant is taxable goods. It is covered under Notification No.1/2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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