Appeal rejected, supply of frozen chicken in unit containers not GST exempt.

The appeal was rejected, and the Advance Ruling dated 22-4-2019 was upheld. The supply of branded frozen chicken packed in individual LDPE bags in predetermined quantities and supplied in HDPE bags was classified as supply in unit containers and not exempt from GST under the relevant notification.

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Issues Involved:
1. Condonation of delay in filing the appeal.
2. Classification of HDPE bags as unit containers.
3. Determination of whether the frozen chicken is exempt from GST under Entry No. 9 of Notification No. 2/2017-C.T. (Rate), dated 28-6-2017.

Issue-wise Detailed Analysis:

1. Condonation of Delay:
The first issue concerns the delayed filing of the appeal under Section 100(2) of the CGST Act. The prescribed time limit of 30 days ended on 26-5-2019, but the appeal was submitted electronically on 12-6-2019 and physically on 17-6-2019, resulting in a delay of 17 days. The appellant attributed the delay to the time taken by the Accounts Department of the Army in clarifying the GST levy on chilled/frozen meat products. The Appellate Authority condoned the delay, considering the circumstances beyond the appellant's control, and admitted the appeal for final disposal on merits.

2. Classification of HDPE Bags as Unit Containers:
The appellant contested the classification of HDPE bags as unit containers. They argued that the packaging did not qualify as unit containers since the weights of the frozen chicken varied and were not predetermined. The definition of a unit container, as per Notification No. 1/2017-C.T. (Rate), dated 28-6-2017, requires a package designed to hold a predetermined quantity or number, indicated on the package. The appellant's packaging did not indicate a predetermined quantity, and the weights varied from one package to another. The appellant cited various case laws to support their argument that the packaging used did not meet the criteria of unit containers.

3. GST Exemption Status:
The appellant sought clarification on whether the frozen chicken sold in packaged form was exempt from GST under Entry No. 9 of Notification No. 2/2017-C.T. (Rate), dated 28-6-2017. The Rajasthan Advance Ruling Authority had classified the branded frozen chicken under HSN Code 0207 12 00 and ruled that it was not exempt from GST. The appellant argued that the packaging did not qualify as unit containers and, therefore, should be exempt under the said notification.

Detailed Findings:

Condonation of Delay:
The Appellate Authority found the reasons for the delay satisfactory and condoned the delay, allowing the appeal to be considered on its merits.

Classification of HDPE Bags as Unit Containers:
The Appellate Authority examined the definition of unit containers and the appellant's packaging process. It was found that each dressed chicken carcass was individually packed in LDPE bags and then placed in HDPE bags. The primary packages contained a predetermined quantity (one chicken), and the secondary HDPE bags were designed to hold a predetermined quantity. The Authority concluded that these packages met the criteria of unit containers as defined in the notification.

GST Exemption Status:
The Appellate Authority upheld the Rajasthan Advance Ruling Authority's decision, stating that the branded frozen chicken packed in individual LDPE bags and supplied in HDPE bags was subject to GST. The goods were classifiable under HSN Code 0207 12 00 and did not qualify for exemption under Entry No. 9 of Notification No. 2/2017-C.T. (Rate), dated 28-6-2017.

Conclusion:
The appeal was rejected, and the Advance Ruling dated 22-4-2019 was upheld. The supply of branded frozen chicken packed in individual LDPE bags in predetermined quantities (one in number) and supplied in HDPE bags was classified as supply in unit containers and not exempt from GST under the relevant notification.

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