Prepared edible products classification under Chapter 2008 determines GST rate for chips, including jaggery-coated banana chips.

Banana chips, jackfruit chips and tapioca chips were classified under Heading 2008 as prepared or preserved edible parts of plants, because that heading was more specific than the residuary Chapter 2106. Jaggery coated banana chips were also excluded from Chapter 2106 since jaggery was treated as commercially distinct from sugar and the product did not answer the description of sweetmeat. On that classification, all four products fell within the GST entry for Chapter 2008 and attracted GST at 12%. The presence of jaggery did not alter the tariff classification or the applicable rate.

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Issues: (i) Whether banana chips, jackfruit chips and tapioca chips are classifiable under Chapter 2008 or under Chapter 2106 of the Customs Tariff; (ii) Whether jaggery coated banana chips are classifiable as sweetmeats under Chapter 2106; (iii) What rate of GST applies to banana chips, jackfruit chips and tapioca chips; (iv) What rate of GST applies to jaggery coated banana chips.

Issue (i): Whether banana chips, jackfruit chips and tapioca chips are classifiable under Chapter 2008 or under Chapter 2106 of the Customs Tariff

Analysis: The rate notification adopts the tariff headings of the Customs Tariff Act and its interpretation rules. Applying the General Rules for Interpretation, the products were found to be prepared vegetable, fruit or plant-part products obtained by frying and preservation processes. Chapter 2106 being a residuary heading applies only where no more specific heading covers the goods. The goods were held to fit within Heading 2008 as prepared or preserved fruit, nuts and other edible parts of plants.

Conclusion: Banana chips, jackfruit chips and tapioca chips are classifiable under Heading 2008.19.40 and not under Heading 2106.

Issue (ii): Whether jaggery coated banana chips are classifiable as sweetmeats under Chapter 2106

Analysis: Sweetmeats were treated as sweet edible preparations rich in sugar or prepared with sugar. The product in question contains jaggery but not sugar, and jaggery and sugar were treated as commercially distinct. On that basis, the product did not answer the description of sweetmeat and could not be placed in Chapter 2106 on that ground.

Conclusion: Jaggery coated banana chips are not classifiable as sweetmeats under Chapter 2106.

Issue (iii): What rate of GST applies to banana chips, jackfruit chips and tapioca chips

Analysis: Once classified under Heading 2008, the goods fell within the GST rate entry for Chapter 2008 edible preparations in Schedule II of the rate notification. The applicable entry prescribed the higher rate attached to that heading.

Conclusion: Banana chips, jackfruit chips and tapioca chips attract GST at 12%.

Issue (iv): What rate of GST applies to jaggery coated banana chips

Analysis: Since jaggery coated banana chips were also classified under Heading 2008.19.40, the same Schedule II entry applied. The presence of jaggery did not change the tariff classification or the applicable rate.

Conclusion: Jaggery coated banana chips attract GST at 12%.

Final Conclusion: The products were held to fall in Chapter 2008 as prepared edible products, and all four goods were subjected to GST at the rate applicable to that heading rather than the lower rate claimed by the applicant.

Ratio Decidendi: Where a food product is specifically covered by a tariff heading as a prepared or preserved edible product, the residuary heading cannot be invoked, and sweetness introduced by jaggery does not by itself convert a non-sugar preparation into a sweetmeat.

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