Snack products like potato chips, sev, chevda classified as namkeens under CTH 21069099 attract 12% GST when pre-packaged

AAR Gujarat ruled that various snack products including salted potato chips, potato sev, potato chevda, sing bhujiya, sev mamara, chana daal, gathiya, and khatta mitha chevda mixture are classified under CTH 21069099 as "namkeens" - savoury snacks ready for consumption. Since these products are pre-packaged and labelled, they attract 12% GST under entry 46 of Notification 1/2017-CT (Rate), not the 5% rate applicable to unpackaged goods. Potato starch, being a by-product, is classified under CTH 11081300 and also attracts 12% GST.

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Issues Involved:
1. Classification and GST rate for salted and flavored Potato Chips.
2. Classification and GST rate for Potato Sev (Aloo Sev).
3. Classification and GST rate for Potato Chivda (Potato Salli Mixture).
4. Classification and GST rate for Sing Bhujiya.
5. Classification and GST rate for Sev Mamara (Roasted Puffed Rice mixed with Nylon Sev).
6. Classification and GST rate for Chana Daal (Fried Split Bengal Gram).
7. Classification and GST rate for Gathiya.
8. Classification and GST rate for Khatta Mitha Chevda Mixture.
9. Classification and GST rate for Potato Starch.

Detailed Analysis:

1. Salted and Flavored Potato Chips:
The applicant intends to sell unbranded salted and flavored potato chips. The manufacturing process involves cleaning, peeling, slicing, frying, seasoning, and packaging in unbranded plastic bags. As per the applicant, these products are classified as "Namkeens" under tariff item 2106 90 99, attracting a GST rate of 5% if sold without a brand name. However, post the amendment effective from 18-7-2022, the classification remains under 2106 90 99, but the GST rate applicable is 12% as the products are pre-packaged and labeled.

2. Potato Sev (Aloo Sev):
Potato Sev is manufactured using various ingredients like Longi Mirch, white salt, turmeric powder, potato flakes, gram flour, starch powder, and rice flour. The final product, sold as "Namkeen," is classified under tariff item 2106 90 99. Initially, it attracted a GST rate of 5% when unbranded, but the amended GST rate is 12% for pre-packaged and labeled products.

3. Potato Chivda (Potato Salli Mixture):
Potato Chivda is made from raw potatoes and mixed with various ingredients like sugar, rock salt, red chili, green chili, turmeric powder, fried masala Sabu dana, raisins, peanuts, and other dry fruits. Classified under tariff item 2106 90 99, it initially attracted a GST rate of 5% when unbranded. Post amendment, the GST rate is 12% for pre-packaged and labeled products.

4. Sing Bhujiya:
Sing Bhujiya is made from peanuts, gram flour, salt, and various spices. It is classified under tariff item 2106 90 99 and initially attracted a GST rate of 5% when unbranded. Post amendment, the GST rate is 12% for pre-packaged and labeled products.

5. Sev Mamara (Roasted Puffed Rice mixed with Nylon Sev):
Sev Mamara is made from puffed rice, ready Nylon Sev, and various spices. It is classified under tariff item 2106 90 99 and initially attracted a GST rate of 5% when unbranded. Post amendment, the GST rate is 12% for pre-packaged and labeled products.

6. Chana Daal (Fried Split Bengal Gram):
Fried Chana Daal is made from split Bengal gram, edible oil, water, and various spices. It is classified under tariff item 2106 90 99 and initially attracted a GST rate of 5% when unbranded. Post amendment, the GST rate is 12% for pre-packaged and labeled products.

7. Gathiya:
Gathiya is made from white salt, baking soda, gram flour, pea flour, black pepper, carom seeds, edible oil, and starch powder. Classified under tariff item 2106 90 99, it initially attracted a GST rate of 5% when unbranded. Post amendment, the GST rate is 12% for pre-packaged and labeled products.

8. Khatta Mitha Chevda Mixture:
Khatta Mitha Chevda Mixture is made from chana daal, green peas, masoor daal, Sev, Gathiya, Bundi, rice flakes, red peanuts, and various spices. It is classified under tariff item 2106 90 99 and initially attracted a GST rate of 5% when unbranded. Post amendment, the GST rate is 12% for pre-packaged and labeled products.

9. Potato Starch:
Potato starch is produced as a by-product during the manufacturing process of potato-based products. It is classified under tariff item 1108 13 00. The applicable GST rate is 12% as per entry No. 18 of Schedule-II of Notification No. 1/2017-CT (Rate).

Ruling:
The tariff classification and GST tax rate for the applicant's products are as follows:
1. Salted and flavored Potato Chips: 21069099, GST rate 12%.
2. Potato Sev (Aloo Sev): 21069099, GST rate 12%.
3. Potato Chivda (Potato Salli Mixture): 21069099, GST rate 12%.
4. Sing Bhujiya: 21069099, GST rate 12%.
5. Sev Mamara (Roasted Puffed Rice mixed with Nylon Sev): 21069099, GST rate 12%.
6. Chana Daal (Fried Split Bengal Gram): 21069099, GST rate 12%.
7. Gathiya: 21069099, GST rate 12%.
8. Khatta Mitha Chevda Mixture: 21069099, GST rate 12%.
9. Potato Starch: 11081300, GST rate 12%.

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