DECEMBER 01, 2021

By Somesh Arora, Advocate

REMEMBER those days when you never acted that pricey and hard to get. You vitalized us all then, which you do even now. But now you have become little hard to get.

The taxmen, along with others of your class of glucose and milky varieties used to look upon you with sense of favour till 2017. For you were priced at below Rs.100/- per Kg. and had a visibility in all the mid day meals, famines, floods and for all purposes of charity, which required nutrition for the under nourished of this country placed at rank 102 out of 117 of a number of countries assessed by WHO in Global Hunger Index of 2019. Even the Government at various levels is making serious endeavor to improve nutrition through likes of you. You were affordable and attractively priced and appropriately taxed. We saw you being aerial dropped right in floods in food packs and being lapped up even by labour class during pandemic during their pad yatras to their native places during curfew of 2020. Hon'ble Prime Minister in his  Mann ki Baat  session called upon to observe the entire month of September of 2020 as 'Poshan Maah'  i.e. 'Nutrition month'. He recalled the maxim - "Yatha Annam Tatha Mannam,” which means that mental and intellectual development is directly related to the quality of our food intake. Therefore, you not only help nourish and satiate hunger but also help in providing well shaped minds.

Successive governments and taxmen have realized and appreciated your potential and meted you a special treatment worthy of you, if you commanded retail sale price of less than Rs.100/- per Kg. For instance in Central Excise Tariff Act, 1985 just before introduction of GST Tariff within the Chapter Heading 1905, you along with others of your class were subjected to Central Excise effective duty of 'Nil', while other premium biscuits like Waffles and Wafers etc. were subjected to 6% duty vide Notification No. 12/2012-CE dated 17.03.2012.

However, GST came and changed it all. Taxmen lost their love for you. The fine distinction based on the logic of nutrition was overlooked. And you became more classy and joined the elite company of various other premium biscuits, cookies and Pastries, Cakes and other Baker's wares, whether or not containing Cocoa, Communion Wafers etc. and started getting taxed @18% (i.e. 9% CGST + 9% SGST/UTGST) vide Notification No.1/2017-C.T.-(Rate) and 1/2017-I.T.-(Rate) dated 28.06.2017 and SGST/UTGST Notification. Your erstwhile poor cousin 'Rusks' continued with lower tax rate of 5% despite commanding market price of Rs.150/- per Kg. Why the taxmen sought you for higher rate continues to be somewhat of a mystery? The net result is that some manufacturers have deserted you now for the premium varieties like Chocó biscuits and cookies. You in future along with others of your ilk may now be less visible and more pricey. You will be missed in famines and in charity. The premium ones replacing you are already costing twice as much as you used to do earlier. Those helping the malnourished may have to be content with less numbers than they were doing in the same amount.

How do we wish that GST Council has a relook on you and on the shape of your tax structure. For we loved the old you always, as you had existed. Well packed, well shaped, affordable and easy to carry anywhere and to handover to any needy, carrying your date of birth on your packing. Your populist appeal has been lost. Now, you appear to be for the rich, as the incentive to keep your price below Rs.100/- has also gone.

Marie, we request you - Dear, don't make yourself so dear.

[The author is Chief Consultant (Amicus Rarus) and former Commissioner of Customs & Central Excise. The views expressed are strictly personal.]