2021-TIOL-158-AAR-GST

Aswath Manoharan

GST -  Applicant is in the process of setting up a unit to carry on the business as manufacturer of banana chips, jack fruit chips, jaggery coated banana chips (sarakaraupperi in Malayalam), masala kadala (masala coated fried groundnut) - Applicant further submits that they intend to use the brand name "AYYAPPA" without taking registration of the brand under the Trade Marks Act, 1999; that they do not wish to raise any actionable claim on the above brand name "AYYAPPA" - Applicant informs that while most of the dealers are paying GST at the rate of 5%, it is learnt that some departmental officers have contacted a few dealers and insisted for payment of tax at the rate of 12%, therefore, the present application seeking an advance ruling - The contention of the applicant is that Banana Chips, Jack fruit Chips fall under the category of "Namkeens" and hence are appropriately classifiable under Customs Tariff Heading 2106 90 and is liable to GST at the rate of 5 % as per entry at Sl No. 101A of Schedule I of Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017; that  the Tapioca Chips are classifiable under Customs Tariff Heading 1903 or alternatively under Customs Tariff Heading 2106 90 and liable to GST at the rate of 5% as per SI.No.98 or Sl No. 101A of Schedule I of Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017; that the Jaggery Coated Banana Chips are classifiable as "Sweetmeats" under Customs Tariff Heading 2106 90 and liable to GST at the rate of 5% as per SI.No.101 of Schedule I of Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017.

Held:  Chapter Heading 2008 of the Customs Tariff covers all roasted and fried vegetable products - Frying and roasting are two popular cooking methods that both use high temperature - It is not necessary that both the conditions are to be cumulatively satisfied for classifying a product under the category of roasted and fried products - When according to chapter notes and description of tariff items the products are classifiable under specific headings of Chapter 20 they cannot be classified under Heading 2106 as food preparations not elsewhere specified or included - Applying the principles of interpretation in Rule 2 of the General Rules for Interpretation of the First Schedule to the Customs Tariff Act, 1975 the Banana Chips, Jackfruit Chips, Tapioca Chips and Jaggery Coated Banana Chips are classifiable under Tariff Heading 2008 19 40 of the Customs Tariff Act, 1975 - Insofar as classification of  jaggery coated banana chips (sarakaraupperi in Malayalam) is concerned, jaggery is manufactured from sugarcane by a simple process which can be done in the farms by the farmers themselves but the manufacturing of sugar involves many processes that cannot be carried out in a farm - The only process that is common for manufacture of jaggery and sugar is the extraction of juice from sugarcane and its concentration - Jaggery and Sugar are commercially distinct products having individual characteristics and economic value and both cannot be equated hence by no stretch of imagination can Jaggery Coated Banana Chips be considered as a sweet edible preparation containing sugar i.e. cannot merit classification as 'sweetmeat' under heading 2106 - On a plain reading of the  entry at Sl No. 40 of Schedule II of Notification No.01/2017-CTR, it is evident that all the products that fall under Chapter Heading 2008 of the Customs Tariff Act, 1975 attract GST at the rate of 12 % [6% CGST + 6% SGST]: AAR

- Application disposed of: AAR