"K Juice Grape" classified as carbonated beverage under CTH 2202 10 90 with 28% GST rate upheld by Appellate Authority.

The Appellate Authority upheld the classification of "K Juice Grape" under CTH 2202 10 90 with an applicable GST rate of 28%. It was determined that the product is a carbonated fruit beverage, not solely a fruit juice-based drink, justifying the higher tax rate. The decision was based on the product's carbonation and marketing as a carbonated beverage, following Para 2.3.30 of the FSSAI regulations. The appeal was dismissed, affirming the Lower Authority's ruling.

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Issues Involved:
1. Classification of the product "K Juice Grape" under the GST Act.
2. Applicable GST rate for the product.
3. Determination of the product as a fruit beverage or fruit-based drink.
4. Consideration of the percentage of fruit or pulp in the beverage to classify it under the GST Act.

Issue-Wise Detailed Analysis:

1. Classification of the Product "K Juice Grape" under the GST Act:
The appellant contended that their product, "K Juice Grape," is a thermally processed fruit beverage complying with category 2.3.10 of the FSSAI regulations, 2011. They argued that the product should be classified under CTH 2202 9920 as a fruit juice-based drink. The Lower Authority, however, classified the product under CTH 2202 10 90, categorizing it as "Other" under waters, including mineral waters and aerated waters, containing added sugar or other sweetening matter or flavored. The Appellate Authority upheld this classification, noting that the product is carbonated and falls under the category of "Carbonated Fruit Beverages or Fruit Drinks" as per Para 2.3.30 of the FSSAI regulations.

2. Applicable GST Rate for the Product:
The Lower Authority determined that the applicable GST rate for "K Juice Grape" is 14% CGST and 14% SGST, totaling 28%. This decision was based on the classification of the product under CTH 2202 10 90. The appellant argued that the product should attract a 12% GST rate under the entry for fruit juice-based drinks. The Appellate Authority, however, found that the product is not merely a fruit juice-based drink but a carbonated beverage, thus justifying the higher tax rate.

3. Determination of the Product as a Fruit Beverage or Fruit-Based Drink:
The appellant claimed that their product is a fruit-based drink, citing the Supreme Court's ruling in the "Appy Fizz" case, which classified a similar product as a fruit juice-based drink. However, the Appellate Authority distinguished the present case from the "Appy Fizz" case, noting that "K Juice Grape" is marketed as a carbonated fruit beverage and falls under the specific category of carbonated fruit drinks as per FSSAI regulations. Therefore, it does not qualify as a mere fruit juice-based drink.

4. Consideration of the Percentage of Fruit or Pulp in the Beverage:
The appellant argued that the product contains 13% grape juice concentrate and should be classified based on its fruit content. The Appellate Authority, however, emphasized that the product's carbonation and its classification under Para 2.3.30 of the FSSAI regulations as a carbonated fruit beverage take precedence over the fruit content percentage. The Authority concluded that the product's carbonation for preservation purposes and its marketing as a carbonated beverage justify its classification and the applicable GST rate.

Conclusion:
The Appellate Authority upheld the Lower Authority's classification of "K Juice Grape" under CTH 2202 10 90 and the applicable GST rate of 28%. The Authority found that the product is a carbonated fruit beverage, not merely a fruit juice-based drink, and thus does not qualify for the lower tax rate. The appeal was disposed of accordingly, affirming the Lower Authority's decision.

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