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TMI Blog2024 (2) TMI 350X X X X Extracts X X X X X X X X Extracts X X X X ..... g his conclusion. Therefore, the impugned order is liable to be set aside to that extent and the matter requires remand for fresh consideration. The impugned order dated 07.02.2023 is set aside to the extent of the 1st respondent s finding on the product bio pro-enhac and the matter is remanded to 1st respondent to afford an opportunity of hearing to the petitioner regarding the nature of the product bio pro-enhac and its taxability and pass an appropriate order afresh on merits in accordance with the governing law and rules expeditiously - this writ petition is partly allowed. - HON BLE SRI JUSTICE U. DURGA PRASAD RAO AND HON BLE SMT JUSTICE VENKATA JYOTHIRMAI PRATAPA For the Petitioner : Sri S.Ravi, Senior Counsel representing Sri G. Narendra Chetty For the Respondents : Learned Government Pleader for Commercial Taxes ORDER (PER HON BLE JUSTICE U. DURGA PRASAD RAO) In this writ petition filed under Article 226 of the Constitution of India, the petitioner prays for following relief: to issue an appropriate writ order or direction more particularly in the nature of mandamus declaring that the impugned Assessment + penalty + interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etc. The bio pro-enhac and shrimp feed differ primarily in that instead of being pelletted, the substance that is made into feed will be fermented after production and as a result fermented feed is referred as bio pro-enhac. The 1st respondent while admitting that the process of manufacture of bio pro-enhac uses the above elements, however, held that it contains both natural and chemical elements which mainly improve immunity, health of shrimp and digestion and food intake of shrimp and vitamins help to resist the infections. With regard to the Minwa and Minwa plus, the 1st respondent held that in the product description it is mentioned stabilized alkalinity and control of PH fluctuations in water , and they are not micro minerals with HSN code 2309 but come under HSN code 2931 i.e., other organo-inorganic compounds taxable at 18%. It is submitted that Sl. No. 102 of notification number 2/2017 CTR dated 28.06.2017 provides exemption from payment of GST on quatic Feed including Shrimp Feed and Prawn Feed, Poultry Feed and Cattle Feed, including Grass, Hay and Straw, Supplements and Additives, Wheat Bran and De-Oiled Cake other than Rice Bran The words supplements ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry feed and cattle feed, including grass, hay and straw, supplements and additives, wheat bran and de-oiled cake other than rice brawn are exempted from tax. However, it is pertinent to note the subject matter goods supplied by the petitioner are different from the goods enumerated in the above notification. These products are covered under HSN code 2931 ther organic and Inorganic compounds and HSN code 2936 vitamins and pro-vitamins (d) The generic definition of animal feed which includes animal feed supplements added to animal feed cannot be relied upon as the products supplied by the petitioner are not consumed as if shrimp feed but rather are added to the water for the specified purpose of ensuring a functional shrimp habitat / environment. In the impugned order, it is elaborated as to how the petitioner s products when dissolved directly into the pond water ensure that the PH balance and alkalinity levels of the water are neutrally maintained, thereby avoiding either acidity or alkalinity. Thus, the goods supplied by the petitioner are neither food supplements nor food additives. They are chemical-based vitamins and products that are specifically used in the shrimp p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kes good use of feeds and safeguard its health. On the other hand, HSN code 2936 covers vitamins and pro-vitamins which are medicinal in nature and have much higher concentration of active substance. He would submit that the products manufactured by the petitioner are in the nature of food supplements and additives rather than having any medicinal value. He would submit that as per Sl.No.102 of notification No.2/2017 CTR dated 28.06.2017, exemption is provided from payment of GST on: cquatic feed including shrimp feed and prawn feed, poultry feed and cattle feed, including grass, hay and straw, supplements and additives, wheat bran and de-oiled cake other than rice bran (c) Referring to the above notification, he would submit that the products manufactured by the petitioner would come under supplements and additives to the shrimp feed and they are exempted from GST. Learned counsel placed reliance on Sun Export Corporation, Bombay v. Collector of Customs, Bombay MANU/SC/0703/1997 = AIR 1997 SC 2658 and would contend that since the animal feed supplement was held to be exempted under the Customs Tariff Act in said decision, in similar lines, the shrimp feed sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t not under HSN code 2309. He would submit that the 1st respondent also considered the ratio in Sun Export Corporation (1 supra). He thus prayed to dismiss the writ petition. He would further argue that since the petitioner has an efficacious alternative remedy of appeal, the writ petition is not entertainable and liable to be dismissed in limini. 7. The point for consideration is whether the two products i.e., Bi proenhac and Minwa and Minwa plus manufactured by petitioner fall under HSN code 2309 but not under 2936 and 2931 respectively and are exempted from tax and whether the impugned order is liable to be set aside to that extent? 8. Point: We have punctiliously scrutinized the pleadings and arguments addressed by both parties and perused the impugned order. The petitioner claims total exemption of his products i.e., Bio pro-enhac and Minwa and Minwa plus from GST on the ground that they fall within the HSN code 2309 and there was a notification No. 2/2017 and on the other hand, the Department would contend that the two products will fall under HSN code No. 2936 and 2931 respectively and liable to be taxed at 18% as per the GST laws. Admittedly, HSN 2309 inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ource. But when using bicarbonate, plants release carbonate that hydrolyses and causes pH to increase. Calcium ions react at elevated pH to precipitate carbonate ions as calcium carbonate, and this reaction minimizes the amount of carbonate in the water to hydrolyse and increase pH. Aluminium used to reduce of high-level pH value in Shrimp ponds. It is a safe and relatively inexpensive chemical. It reacts with water to form a certain acid. The pH value in Shrimp ponds can be reduced by applying 10 g of aluminium per 1000 liters of water. The pH value is likely to very quickly from the use of aluminium. It can be mixed with water and poured into various parts of the pond. Magnesium helps maintain calcium and alkalinity levels in a Shrimp. If levels are too low, calcium will combine with alkalinity to create calcium carbonate in the water column. This creates a snow that can stick to pumps, impellers and heaters instead of being used by Shrimp to build their skeletons. Magnesium binds to the surface of calcium carbonate crystals. This effectively stops calcium carbonate crystal from growing and precipitating out of the aquarium water. Potassium is used to correct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at bran, corn meal, high-pro soya etc. It is also his case that bio proenhac and shrimp feed differ primarily in that instead of being pelletted, the substance that is made into feed will be fermented after production and as a result, fermented feed is referred as bio pro-enhac. Thus, the petitioner claims that bio pro-enhac is a one type of shrimp feed and the process of manufacture is only different and further, while the shrimp feed is in the pellet form, the bio pro-enhac is in the fermented form. His further claim is that the bio pro-enhac falls under HSN code 2309 as it works as supplement to the shrimp feed. His case is that not only shrimp feed but its supplements and additives also come under HSN code 2309 and are exempted from tax. In this context, in Sun Export Corporation (1 supra), the Hon ble Apex Court was dealing with the question as to whether the animal feed supplement would fall under the exemption notification dated 01.11.1982 . Referring to the judgment of Bombay High Court, wherein it was observed that it cannot be said that animal feed concentrates are not animal feed and in the same manner products which supplement the animal feed and are generally added to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f it is an item of general use. Vitamins and provitamins are normally covered under code heading 2936, but if they're prepared as food supplements in the form of tablets, etc. they would not be classifiable under this heading as the way they are presented, they are suitable for a specific use. Heading 2309 would cover items like feed supplements for animals that contain vitamins and other ingredients such as cereals and proteins. These are covered in chapter 23 under heading code 2309, or antibiotic preparations used in animal feeding for example a dried antibiotic mass on a carrier like cereal middling. The antibiotic content in these items is usually between 8% and 16%. Thus, HS code 2309 would cover only such product, which in the form supplied, are capable of specific use as food supplement for animals and not capable of any general use. BioproEnhac is prepared in the form of Powder which is in distinct form when compare to normal pellet feed form. By observing chapter 29 Vitamins and provitamins are normally covered under code heading 2936, but if they're prepared as food supplements in the form of tablets, etc. In Shrimp farming normally form of tablets wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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