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TMI Blog2025 (2) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... legally tenable owing to the fact that in the paragraphs above, we have already held that on account of the composition, etc. the product gets excluded from falling under chapter headings 1101, 1102 and 1106. Therefore, the question of relying on Rule 3(b) of the GRI to classify the goods based on the essential character, does not arise. It is owing to this finding, that the averment of the appellant that entry most beneficial to the appellant needs to be preferred, also stands rejected. None of the products of the appellant merit classification under Chapter 11 of the Customs Tariff Act, 1975 and specifically under Chapter Headings 1101, 1102 or 1106 of the Customs Tariff Act, 1975. Instant Gota mix supplied with chutney powder - Methi gota instant mix supplied with kadhi chutney powder - instant Khaman mix supplied with masala pack - HELD THAT:- The appellant has stated that they are naturally bundled & hence supplied in conjunction with each other & the GST rate applicable to principal supply ie instant mix flour would be applicable. The findings of GAAR recorded in para 8.3 of the impugned ruling dated 19.7.2021 agreed upon and it is held that it is a mixed supply. Mix Flou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... + kadhi powder Dhosa instant mix flour Khaman instant mix flour + masala pack which as per the appellant are not in 'ready to eat' but in 'ready to cook' form under their registered brand name. 4. Before the GAAR, the appellant submitted that the below mentioned process is undertaken for manufacturing & selling the above products, viz: (a) that they purchase food grains and pulses from vendors. (b) that such food grains/pulses are fumigated and cleaned for removal of wastage. (c) that food grains/pulses are then grinded and converted into flour. (d) that flour is sieved for removal of impurities. (e) that flour is then mixed with other ancillary ingredients such as salt, spices, etc. The proportion of flour in most of the instant mixes is ranging from 70% to 90%. (f) that flour mix is then subjected to quality inspection and testing. (g) that flour mix is thereafter packaged and stored for dispatch. 5. The appellant, before the GAAR also submitted the table showing constituent components of instant mix flours viz: Sr.No. Product Name (A) Dried Leguminous Vegetable Flours (B) Rice & Wheat Flours Total Flours (A+B) (%) (C) Additives (D) Spic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Salt, Acidity regulator (Citric acid INS 330), Sugar, Raising agent (Sodium bicarbonate INS 500(ii)) 7.25 Dry Fenugreek Leaves (Kasuri Methi), Coriander Crushed, Black Pepper Crushed, Turmeric Powder, Chilli Powder, Compounded Asafoetida, Garam Masala Powder, Ajwain 100.00 9A Kadhi Powder 40 gm Crushed Sugar, Iodised Salt, Hydrogenated Vegetable Oil, Acidity regulator (Citric acid INS 330) White Chilli Powder, Mustard Seed, Turmeric Powder, Fresh Curry Leaves, Compounded Asafoetida 10 Handvo Instant Mix Flour 400 gm 15.00 8.00 15.00 38.00 33.00 8.00 41.00 79.00 19.00 Sugar, Iodised Salt, Acidity regulator (Citric acid INS 330), Raising agent (Sodium bicarbonate INS 500(ii)) 2.00 Chilli Powder, Turmeric Powder 100.00 6. The manufacturing process adopted was provided in the form of a flow chart reproduced at para 4 of the impugned ruling. 7. The appellant further submitted that the instant flour mix retained its identity as flour and therefore is classifiable under heading 1101, 1102 or 1106 as the case may be based on the dominant flour component. 8. In view of the foregoing, the appellant raised the following question before the GAAR viz: a) What is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od preparations', then the same gets excluded from the heading 1101 or 1102; * that products being supplied by the applicant contain spices and additives apart from flour of dried leguminous vegetables, rice and wheat, in different proportions; * that the difference between idli/dhosa instant mixes and idli/dhosa batters is understood from the images of idli/dhosa batters, reproduced in the impugned ruling; that instant mix of idli/dhosa are not idli/dhosa batters and therefore does not get covered under entry 1102; * that heading 2106 is not confined to processed or semi processed food, cooked or semi cooked food, preserved food and ready to eat food; * that gotas/methi gotas and chutney powder/kadhi chutney powder supply is not naturally bundled and the supply is for a single price; that the supply of Khaman instant mix flour with masala pack is not naturally bundled and the supply is for a single price & hence these supplies fall under mixed supply. 11. Feeling aggrieved, the appellant is before us i.e. Gujarat Appellate Authority for Advance Ruling [GAAAR] raising the following averments viz * that the instant flour mix retained its identity as flour & therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r No. 80/54/2018-GST dated 31.12.2018, that 'sattu', falls under HSN code 1106 & is leviable to GST @ 5%; * that they would like to rely on the case of IOC MANU/SC/0142/2004, wherein the Hon'ble SC held that officers cannot argue the case against circular issued by the Board; * that Idli, Dhosa, Khaman, Dahiwada and Dhokla are mixture of flours like Black Gram (Urad Dal) and/or Rice and/or Refined Wheat Flour and/or Bengal Gram (Chana Dal) and/or Green Gram (Moong Dal)" with addition of very small amount of "additives like iodized Salt and/or Sugar and/or Acidity regulator (Citric acid INS 330) and/or Raising agent (Sodium bicarbonate INS 500(ii)); that it does not contain any spices and hence should be covered as Flours under Chapter 11 & be leviable to GST @ 5%; * that they would like to rely on the case of Satnam Overseas Limited MANU/SC/0419/2015; * that form of product is not determinative of its classification; that by adding water to idli/dhosa instant mix, batter can be prepared; that denying the benefit of entry 100A of schedule I in respect of GST @ 5%, would frustrate the purpose. * the table showing constituent components of five (5) ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs 1101, 1102 and 1106 read as under: 11.01 Wheat or meslin flour This heading covers wheat or meslin flour (i.e. the pulverised products obtained by milling the cereals of heading 10.01) which fulfil the requirements as to starch content and ash content set out in paragraph (A) of Chapter Note 2 (see General Explanatory Note) and comply with the criterion of passage through a standard sieve as required by paragraph (B) of that Note. Flours of this heading may be improved by the addition of very small quantities of mineral phosphates, anti-oxidants, emulsifiers, vitamins or prepared baking powders (self raising flour) Wheat flour may be further enriched by an addition of gluten, generally not exceeding 10%. The heading also covers swelling (pregelatinised) flours which have been heat treated to pregelatinise the starch. They are used for making preparations of heading 19.01, bakery improvers or animal feeds or in certain industries such as the textile or paper industries or in metallurgy (for the preparation of foundry core binders). Flours which have been further processed or had other substances added with a view to their use as food preparations are excluded (generally headi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... solid or powder form), with a basis of vegetable flours or meals (heading 21.04). (B) Flour, meal and powder of sago or of roots or tubers of heading 07.14. These products are obtained by the simple grinding or grating of the pith of the sago palm or of the dried roots of the manioc, etc. Some of these products are often subjected to heat treatment in the course of manufacture to eliminate toxic substances; this treatment may entail pregelatinisation of the starch. The heading does not cover starches obtained from these sources (it should be noted that the starch obtained from sago is sometimes called "sago flour"). These starches fall in heading 11.08 and can be distinguished from the flours of this heading, because flours, unlike starches, do not crackle when rubbed between the fingers. Pelletised flour, meal and powder of sago or of roots or tubers of heading 07.14 are also excluded (heading 07.14). (C) Flour, meal and powder of the products of Chapter 8. The principal fruits or nuts of Chapter 8 which are made into flours, meals or powders are chestnuts, almonds, dates, bananas, coconuts and tamarinds. The heading also includes flour, meal and powder of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atoes, fruit, etc.) to processes similar to those indicated in paragraph (1) or (2) mentioned therein. Thus, the products from the milling of the cereals, dried leguminous products etc. are covered in chapter 11 of the Customs Tariff Act, 1975. 18. It is the appellant's averment that instant mix flours of Khaman, Gota, Dalwada, Dahiwada and Methi Gota merit classification under HSN 1106. The explanatory note to chapter 1106 is already reproduced supra. However, it would be prudent to reproduce the chapter heading 1106 of Customs Tariff, for ease of understanding Chapter Heading 1106 as per Customs Tariff: 1106 FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8: 1106 10 00- Of the dried leguminous vegetables of heading 0713 1106 20- Of sago or of roots or tubers of heading 0714: 1106 20 10--- Of sago 1106 20 20 --- Of manioc (cassava) 1106 20 90--- Of other roots and tubers 1106 30 --- Of the products of Chapter 8: 1106 30 10--- Of tamarind 1106 30 20--- Of singoda 1106 30 30--- Mango flour 1106 30 90--- Other Now, as is evident, chapter heading 11.06 c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng 1101 or 11.02. A glance at paragraph 5, supra, which mentions the constituent components of the flours and other ingredients, depict that the various products supplied by the appellant, contain spices and other ingredients apart from flour of dried leguminous vegetables, rice and wheat, in different proportions. The spices and other ingredients contained in these products include sugar, iodised salt, sodium bicarbonate INS 500(ii), citric acid 330, red chili powder, black pepper, coriander, ajwain, fennel, turmeric powder, mustard seed, compounded asafoetida, garam masala, etc.. These spices and ingredients are other than those substances mentioned in the explanatory notes of HSN for chapter heading 1101 or 1102 which could be added in very small quantities to improve or enrich the flours for the resultant product to still remain classified in those chapter headings. The proportion of spices and other ingredients contained in these products is already mentioned in the table supra in paragraph 5. It is also evident from the recipe submitted by the appellant that the spices and other ingredients have been added to the flours for their use as food preparations. The explanatory note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods. (b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3 (a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable. (c) When goods cannot be classified by reference to 3 (a) or 3 (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration. What Rule 3(b), ibid, encapsulates is that mixtures consisting of different material which cannot be classified by reference to 3(a) shall be classified as if they consisted of the material or component which gives them their essential character. The argument put forth is that as the essential character of the instant flour mixes is given by the Flour, so in terms of Rule 3(b) of the GRI, it would fall under chapter heading 1101, 1102 or 1106. The argument is not legally tenable owing to the fact that in the paragraphs above, we have already held that on account of the composition, etc. the product gets excluded from falling under chapter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anatory Note to Chapter 38). However, the heading does not cover enzymatic preparations containing foodstuffs (e.g., meat tenderisers consisting of a proteolytic enzyme with added dextrose or other foodstuffs). Such preparations fall in heading 35.07 provided that they are not covered by a more specific heading in the Nomenclature. As is evident from the explanatory notes, it covers food preparations not elsewhere specified or included. Further of 21.06 covers the preparation for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk, etc.) for human consumption, and preparations consisting wholly or partly of foodstuffs, used in the making of beverages or food preparations for human consumption, are classifiable under Chapter Heading 21.06 of the CTA, 1975. 27. The appellant has already stated that his 10 products of mix flour / instant mix flour are preparations consisting wholly of foodstuffs viz. flours of leguminous vegetables and cereals as well as spices and condiments, and these products are used in the making of food preparations for human consumption. It is a fact that these products are preparations for use, after processing, ..... 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