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Case Title |
Sushi Pet Nutri Science |
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Court |
Telangana Bench AAAR |
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Honorable Judges |
Member Neetu Prasad & Member Mallika Arya |
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Citation |
2021 (7) GSTPanacea 59 HC Telangana Bench AAAR/01/2021 AAAR.COM/01/2020 |
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Judgement Date |
12-July-2021 |
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Council for Petitioner |
NA |
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Council for Respondent |
NA |
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Section |
Section 101 (1) |
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In Favour of |
In Favour of Respondent |
The Telangana Bench of Member Neetu Prasad & Member Mallika Arya has held that The product `poultry meal` manufactured and supplied by appellant falls under Tariff Item No. 2301 10 10 of the Customs Tariff Act, 1975. The product `poultry meal` manufactured and supplied by appellant is not eligible for the exemption contained in entry SI.No.102 of Notification No.2/2017-Central Tax (Rate) dated 28.06.2017 (as amended).
FACTS OF THE CASE
M/s Sushi Pet Nutri science, is a partnership firm engaged in manufacturing / rendering of `Poultry Meal` and `Poultry Fat`. Both these products are used as one of the protein raw material in the manufacturing of animal feed and aqua feed by these industries. The major raw material for manufacturing poultry meal and poultry fat is chicken wastages such as chicken legs, chicken head, intestine, feathers, skin etc. which is bought from the chicken stall owners in twin cities and other parts of Telangana State
With the above background, the applicant had sought for ruling with regard to the HSN codes and the rate of tax in respect of “poultry meal
Vide the impugned order, the Advance Ruling Authority had given the following advance rulings:
“1. The product poultry meal` is classifiable under Chapter Sub Heading No. 2301 10 90 of the first schedule to the Customs Tariff Act, 1975 and the supply of the same attracts GST rate of 5% (2.5% CGST + 2.5% SGST) under Sl.No. 103 of the Schedule-I of the Not No.01/2017-CT (R) dated 28.06.2017 (as amended)
- The product “poultry fat” is classifiable under Chapter Subheading No. 1501 90 of the first schedule to the Customs Tariff Act, 1975 and the supply of the same attracts GST rate of 12% GST (6% CGST + 6% SGST/UTGTS) vide entry No.19 of the Schedule-II of the Not. No. 01/2017-CT (R) dated 28.06.2017 (as amended)
The present appeal challenges the ruling (1) above in respect of “poultry meal”. The ruling (2) on `Poultry Fat` has not been disputed by the appellant.
COURT HELD
Considering the facts as recorded, held that in the above case law, the Heading 2301 of Central Excise Tariff which was considered by the Hon`ble Tribunal covered “Residues and waste from food industries, including bagasse, other waste of sugar manufacture and oil cakes“.
The same is not at all comparable with the situation in the instant case wherein the Heading 2301 of Customs Tariff covers “Flours, meals and pellets…..of meat and meat offal…”.
Further, in terms of Rule 1 of the Interpretative Rules, the “terms of the headings” are the primary and the paramount criterion for classification. Heading 2301 covers “meals., of meat or meat offal” and admittedly the impugned goods are “poultry meal” made from chicken wastages etc.
The impugned goods viz., `Poultry meal` have been held to be classifiable under Heading 2301 of the Customs Tariff. The said Heading figures in Column (2) of the entry No. 102. However, the goods `poultry meal` does not figure in the list of goods specified by description in Column (3) above. Hence, the poultry meal` is not eligible for the above exemption.
ANALYSIS OF THE JUDGEMENT
With regard to the appellants claim for classifying the impugned goods as concentrates falling under Heading 2309 of the Custom Tariff, we find the same is legally untenable due to the following reasoning.
In order to fall under Heading 2309, the goods should be “preparations of a kind used in animal feeding”. Considering the said specific phrase used as the terms of the heading and also considering the said various types of goods mentioned thereunder i.e. Dog or cat food in retail form, compound animal feed fish, prawn feed etc.. And also taking into account the HSN explanatory Notes for the heading 2309 supra, it is evident that the said heading is applicable to finished products which are as such fed to the animals. To further elaborate, the Heading contains the wording as “..used in animal feeding“ and not as “..used in animal feed(s)”.
The phrase `used in animal feeding` has a distinct connotation to denote goods which are fed to animals in a ready to eat condition, whereas the latter phrase `used in animal feeds` will cover raw-materials or ingredients which are used in further manufacture / preparations of animal feeds.
The impugned goods viz., `Poultry meal` have been held to be classifiable under Heading 2301 of the Customs Tariff. The said Heading figures in Column (2) of the entry No. 102. However, the goods `poultry meal` does not figure in the list of goods specified by description in Column (3) above. Hence, the poultry meal` is not eligible for the above exemption
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