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Case Title |
Alisha Gruh Udyog |
|
Court |
Gujarat AAR |
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Honorable Judges |
Member P.Gupta & Member Seema Arora |
|
Citation |
2021 (11) GSTPanacea 67 HC Gujarat GUJ/GAAR/APPEAL/2021/30 |
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Judgement Date |
02-November-2021 |
|
Council for Petitioner |
Apurva N Mehta |
|
Council for Respondent |
NA |
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Section |
Section 100 |
|
In Favour of |
In Favour of Assesses |
The Gujarat Bench of Member J.P.Gupta & Member Seema Arora has held that when a product is eligible to be classified under specific entry then classification under general entry should not be preferred.
Bench find that in the case at hand, the product “different shapes and sizes Papad” is “Papad” of different shapes and size and find specific entry at CTH No. 19059040, therefore as per rule of interpretation, the product is to be classified under CTH No. 19059040 only and not under CTH No. 21069099 of the Customs Tariff Act, 1975 as classified by the GAAR.
FACTS OF THE CASE
The present appeal has been filed by Alisha Gruh Udyog (hereinafter referred to as Appellant) against the Advance Ruling No. GUJ/GAAR/R/66/2020 dated 17.09.2020.
The appellant has raised the following question for advance ruling in the application for Advance Ruling filed by it.
“Whether any tax is payable in respect of sale/ supply of Fryums manufactured by the applicant ? And if answer is in affirmative, the rate of tax thereof ”?
Answer: The product ‘fried Fryums’ manufactured and supplied by applicant is classifiable under Tariff Item 2106 90 99 of the First Schedule to the Customs Tariff Act, 1975. Goods and Services Tax rate of 18% (CGST 9% + GGST 9% or IGST 18%) is applicable to the product ‘fried Fryums’ as per Sl. No. 23 of Schedule III of Notification No. 1/2017Central Tax (Rate), dated 28-6-2017, as amended, issued under the CGST Act, 2017 and Notification No. 1/2017-State Tax (Rate), dated 30-6-2017, as amended, issued under the GGST Act, 2017 or IGST Act, 2017
Aggrieved by the aforesaid advance ruling, the appellant has filed the present appeal.
The appellant in the ground of appeal has submitted that they are in the business of manufacturing and trading of “Papad” of different shapes and sizes in ready to eat form. The same is first fried and various masala powders are applied and packed in small packet for being sold in the market.
The appellant submits that papad whether in ready to cook /un-fried form or ready to eat /fried form remains papad only. Even after frying, it still retains its original character of papad. The Papad, turns out to be a papad when the dough is moulded and given the shape, usually a palm size round or may be smaller or bigger. The advent of technology innovation and different demand of different class of customer Papad comes in different shapes and sizes. The dough remains the same with minor variations in proportion of ingredients and the dough is moulded in the desired shape and size may be round, square, semi circle, hollow circle with bars in between or may be square with bars in between intersecting each other or may be of the shape of any instrument, equipment, vehicle, aircraft, animal, etc. The different shapes and sizes are obtained with the help of a die and there is no difference in either the ingredients used or in the process of manufacture.
COURT HELD
Considering the facts as recorded, held that Rule 3(a) of General Rule of Interpretation of the first schedule of Tariff states that the heading which provides the most specific description shall be preferred to heading providing a more general description.
Hence the rule of interpretation for classification is that when a product is eligible to be classified under specific entry then classification under general entry should not be preferred. Bench find that in the case at hand, the product “different shapes and sizes Papad” is “Papad” of different shapes and size and find specific entry at CTH No. 19059040, therefore as per rule of interpretation, the product is to be classified under CTH No. 19059040 only and not under CTH No. 21069099 of the Customs Tariff Act, 1975 as classified by the GAAR.
In view of the foregoing, bench modify the Advance Ruling of the Gujarat Authority for Advance Ruling in the case of M/s. Alisha Gruh Udyog and held that –
The product “fried – different shapes and sizes Papad” involved in the present case merit classification under Tariff heading No. 19059040 of the Customs Tariff Act, 1975 and chargeable to 18% rate of Goods and Services Tax
ANALYSIS OF THE JUDGEMENT
Bench find that CTH No. 2106 of Customs Tariff Act, 1975 covers the Food preparations not elsewhere specified or included means under this heading all types of foods preparation are covered which are not covered under the specific heading of tariff.
It is important to refer to Chapter Notes of Heading #21 wherein under clause 5 (b) it is stated that Heading 2106 includes preparations for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk or other liquids), for human consumption and under clause 6 it has been stated that Tariff item 2106 90 99 includes sweet meats commonly known as “Misthans” or “Mithai” or called by any other name. They also include products commonly known as “Namkeens”, “mixtures”, “Bhujia”, “Chabena” or called by any other name. Such products remain classified in these subheadings irrespective of the nature of their ingredients.
Bench find that Rule 3(a) of General Rule of Interpretation of the first schedule of Tariff states that the heading which provides the most specific description shall be preferred to heading providing a more general description. Hence the rule of interpretation for classification is that when a product is eligible to be classified under specific entry then classification under general entry should not be preferred. Bench find that in the case at hand, the product “different shapes and sizes Papad” is “Papad” of different shapes and size and find specific entry at CTH No. 19059040, therefore as per rule of interpretation, the product is to be classified under CTH No. 19059040 only and not under CTH No. 21069099 of the Customs Tariff Act, 1975 as classified by the GAAR
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