2018 (12) TMI 141 - AAR - GST

Ruling on Poultry Feed Products' GST Classification and IGST Rate

In Re: M/s. Uttara Impex Private limited

The authority ruled that various poultry feed products, including DL Methionine, Sodium Bicarbonate, Betaine, Tryptophan, Threonine, Lysine HCL, Sodium ... Classification of goods - various poultry feed products - whether covered under the HSN CODES 2301, 2302, 2308, 2309 and effectively exempted or not - Held that:- A feed additive is a food supplement for farm animals that cannot get enough nutrients from regular meals. Such additives include vitamins, amino acids, fatty acids, and minerals. Animal feed is food given to animal which is essential to the development, sustenance, maintenance etc. On the contrary supplement is added to animal feed in order to improve it or make it complete feed. Similarly additive is a food supplement for farm animal that cannot get enough nutrients from regular meals. Therefore there are large number of products that are added to feed and which are capable of providing nutrient required for animal based upon the nature of husbandry such as meat, milk, egg etc. - the entry 102 of the exemption notification is not open ended. It cover those goods that are falling under chapter Heading 2301, 2302,2304,2305,2306,2308 and 2309 and which satisfy the description of goods as animal feed, supplement, concentrate and additives. These imported goods alone are eligible to avail the benefit of tax exemption under the GST ACT. The description of goods against chapter Heading 2835 as mentioned at Sr. No. 105 of exemption notification 2/2017 Integrated Tax (Rate) dated 28/6/2017 covers only Di calcium Phosphate (DCP) of animal feed grade confirming to IS specification No. 5470:2002 - As such applicant product Mono calcium phosphate is not covered by the scope of exemption notification No. 2/2017-Integrated Tax (Rate). The products referred by the applicant in the application will not be covered under Entry- 102 but would be covered under chapters like 28 and 29. Those chapters are related to Organic and inorganic chemicals. Chapter 28 and 29 are not covered under exemption notification no 2/2017 date .28.6.2017 except the HSN Code of 2835. Ruling:- The products referred under application are not covered under entry 102 of the notification 2/2017-lntegrated Tax (Rate) dated 28th June, 2017, except Di Calcium phosphate(28352610) of animal feed grade, which is covered under Entry No. 105 of Notification No. 02/2017-(lntegrated Tax) (Rate) The rest of products would fall under Schedule III and would be liable to tax @ 18 % IGST. Issues Involved:1. Classification of products under the GST regime.Issue-wise Detailed Analysis:1. Classification of Products under GST Regime:The applicant, Uttara Impex Private Limited, is engaged in trading various poultry feed products and sought an advance ruling on their classification under the GST regime. The products in question include DL Methionine, Bicarbonate, Phytase, Betaine, Monodicalcium, Tryptophan, UT Vit 50, Threonine, Lysine, and Creamino. The applicant contends that these products should be classified under HSN codes 2301, 2302, 2308, and 2309, which would render them exempt from GST as per Notification No. 2/2017-Integrated Tax (Rate).Applicant's Interpretation:The applicant argued that the products are feed supplements for poultry and should be classified under the aforementioned HSN codes, making them exempt from GST. They cited various judgments and expert opinions to support their claim that the products are indeed animal feed supplements. The applicant also provided import documents and certificates from different companies asserting that these products are not for human consumption but for animal feed.Jurisdictional Officer's View:The jurisdictional officer contended that the products do not fall under the HSN codes mentioned by the applicant. Instead, the officer classified the products under different HSN codes, such as 29304000 for DL Methionine and 30049032 for Bicarbonate, which attract a GST rate of 12%. The officer argued that these products are not included under the category of poultry feed as per the GST notification.Hearing and Observations:During the hearings, the applicant reiterated their stance, providing detailed descriptions, catalogues, and compositions of the products. The authority examined the definitions of terms like 'feed,' 'supplement,' 'concentrate,' and 'additive' from various dictionaries and encyclopedias. They concluded that the products in question are not covered under the entry 102 of the exemption notification but fall under different chapters of the Customs Tariff Act.Ruling:The authority ruled that the products DL Methionine (29304000), Sodium Bicarbonate (28363000), Betaine (29239000), Tryptophan (29224990), Threonine (29225090), Lysine HCL (29224100), Sodium Sulphate (28331990), Lysine Sulphate (29224100), and Monocalcium Phosphate (28352610) are covered under Schedule III and liable to tax at 18% IGST. However, Di Calcium Phosphate (28352610) of animal feed grade is covered under Entry No. 105 of Notification No. 02/2017-(Integrated Tax) (Rate) and is exempt from GST.Order:The products referred to in the application, except Di Calcium Phosphate (28352610) of animal feed grade, are not covered under entry 102 of Notification No. 2/2017-Integrated Tax (Rate) dated 28th June 2017. The rest of the products fall under Schedule III and are liable to tax at 18% IGST.