Masala Paan classification as mixed supply, not composite; classed under HSN 2106 9099 and taxed at 18%.

Masala paan is held to be a mixed supply because none of its constituent ingredients functions as a principal supply: all ingredients are equally necessary, each can be supplied separately, and perishability supports separate supply; accordingly the mixed-supply test (not natural bundling or principal-supply character) governs taxation. Considering the predominance and proportion of taxable components and applicable tariff entries, the item is classifiable as a miscellaneous edible preparation under HSN 2106 9099 and is taxable at 18% under the relevant GST schedule entry. The proposition that betel leaf is the principal supply is rejected.

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Issues: (i) Classification of Masala Paan for GST tariff purposes; (ii) Whether supply of Masala Paan is a composite supply with betel leaf as the principal supply.

Issue (i): Classification of Masala Paan for GST tariff purposes.

Analysis: Applicable classification rules include the First Schedule to the Customs Tariff Act, 1975 and Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017. The product is a perishable edible preparation composed of multiple ingredients whose individual identities dissolve into a single consumable product. Chapter 21 of the First Schedule covers miscellaneous edible preparations, with a residual catch-all subheading under tariff item 2106 9099 for edible preparations not specified elsewhere. Precedent administrative rulings addressing similarly composed sweetmeat/edible preparations support classification under the residual entry.

Conclusion: Masala Paan is classifiable under tariff item 2106 9099 (Miscellaneous Edible Preparations) and is chargeable at 18% as per Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017.

Issue (ii): Whether supply of Masala Paan is a composite supply with betel leaf as the principal supply.

Analysis: The statutory test for composite supply requires (inter alia) that one component constitute the principal supply to which others are ancillary and that the supplies be naturally bundled and supplied in conjunction in the ordinary course of business (Section 2(30), Section 2(90) and related provisions of the Central Goods and Services Tax Act, 2017). In the present product the ingredients are combined to create a distinct final product whose identity does not reduce to a single predominant ingredient; the consumer purchases the final product as a whole. The characteristics show the ingredients form an integrated edible preparation rather than separately supplied goods with one dominant principal supply.

Conclusion: Supply of Masala Paan is not a composite supply with betel leaf as the principal supply; the proposition that betel leaf is the predominant element is rejected.

Final Conclusion: The product Masala Paan is a single, classifiable miscellaneous edible preparation under tariff item 2106 9099 and is not a composite supply with betel leaf as principal supply; taxation follows classification under Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017.

Ratio Decidendi: A multi-ingredient edible preparation whose ingredients combine into a distinct final product that is ordinarily supplied and consumed as one integrated item is classifiable under the residual tariff entry for miscellaneous edible preparations (2106 9099) and does not qualify as a composite supply with a single predominant principal supply where no component predominates in identity or economic purpose.

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