TaxTMI 
TaxTMI 
2020 (2) TMI 98
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....i Road, Near Keeraithurai Bus Stop, Madurai - 625 001. (hereinafter referred to as 'Applicant') is registered under GST vide GSTIN No. 33AESPD1764Q1ZZ. The Applicant has preferred an application seeking Advance Ruling on the following Question: 1) Whether the unbranded mixture of flour of pulses and grams i.e. leguminous vegetables and cereal flours fall under the HSN Code 1106 and 1102 respectively though blending of leguminous flour added with very small quantity of rice flour or maize flour (without adding salt or any masala product) fall under exemption as per the circular no 80 dt. 31-12-2018? 2) Clarify the GST Rate for Flour Mixture of Grams, pulses, leguminous vegetable with cereal flour/Rice flour and it's HSN Code? The Applicant has submitted the copy of application in Form GST ARA - 01 and submitted a copy of Challan evidencing payment of application fees of Rs. 5,000/-each under Sub-rule (1) of Rule 104 of CGST rules 2017 and SGST Rules 2017. 2.1 The applicant has stated that they manufacture flour of pulses and gram i.e. leguminous vegetables and cereal flour. Their products are sold without having any brand name and claiming exemption after filing disclaimer aff....
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....tu is flour from the Indian subcontinent consisting of a mixture of ground pulses and cereals. The dry powder is prepared in various ways as a principal or secondary ingredient of dishes." 3.1 The applicant was heard in person on 24.07.2019. The applicant appeared and gave a written submission. They stated that they have been supplying gram flour, peas flour, com flour, rice flour separately. Now, they propose to supply a mixture of these flours. They undertook to submit the ratios in which these flour are going to be sold. They have not yet made any supply for the same. They will submit the specific ratio of each ingredients for which the ruling is sought. 3.2 The Superintendent of CGST & Central Excise, Madurai south Range appeared and filed written submissions of the central jurisdiction authority, the Commissioner of CGST & Central Excise, Madurai. 4. The Central Authority has furnished the following comments: * Unbranded flour of dhall, gram, pulses of dried leguminous vegetables(HSN Code 1106) and unbranded cereal flours(rice flour, maize flour etc)(HSN Code 1102) are figured in the exemption list as per Notification No. 2/2017-C.T.(Rate) dated 28.06.2017. But blending/m....
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....mixed with rice flour or maize flour, which continue to be called as flour of pulses and grams. The applicant has sought the eligibility of exemption under the HSN Code 1106 and 1102 as per the circular no. 80 dated 31.12.2018 and the applicable GST Rate and the HSN Code. 7.1 The applicant has claimed exemption on the basis of the circular No.80/54/2018 GST, F.No.354/432/2018-TRU, Govt. India, Ministry of Finance, Department of Revenue (Tax Research Unit), dated 31.12.2018 which clarifies that Chhatu or Sattu, which is a mixture of flour of ground pulses and cereals improved by the addition of very small amounts of additive and continued to be classified under HSN 1106, if sold only as unbranded, attracts Nil GST vide Sl.No.78 of Notification No.2/2017-Central Tax (Rate), dated 28.06.2017 and if branded, attracts 5% GST vide Sl.No.59 of Schedule I of Notification No. 1/2017 -Central Taxes (Rate) dated 28.06.2017. The primary issue to be decided is whether the product of the applicant, a mixture of the flour or flours of Leguminous Vegetables and Cereals as ingredients at specified percentage of composition depending upon the preparation of the desired type of savories falls under ....
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....ed leguminous vegetables, potatoes, fruits etc. The further classification depends on the raw materials and the fineness of the products .i.e flour vs groats or meals when passed through sieve. It specifically excluded prepared flours of heading 1901. CTH 1102 : 1102 CEREAL FLOURS OTHER THAN THAT OF WHEAT OR MESLIN 1102 20 00 - Maize (corn) flour 1102 90 - Other 1102 90 10 - - - Rye flour 1102 90 90 - - - Other HSN Explanatory notes to CTH 1102 states: 11.02 - Cereal flours other than of wheat or meslin.- 1102.20 - Maize (corn) flour 1102.90 - Other This heading covers flours (i.e., the pulverised products obtained by milling the cereals of Chapter 10) other than flours of wheat or meslin. Products of the milling of rye, barley, oats, maize (corn) (including whole cobs ground with or without their husks) grain sorghum, rice or buckwheat are classified in this heading as flours if they fulfil the requirements as to starch content and ash content set out in paragraph (A) of Chapter Note 2 see General Explanatory Note) and comply with the criterion of passage through a standard sieve as required by paragraph (B) of that Note. Flours of ....
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....H 1102. The applicant submitted that the product at hand is manufactured by grinding of pulses, mixing of flours, sieving and the finished product is packed. The flour of grams, peas, rice, maize and urad dal are mixed in various proportions and packed. There is no addition of salt, spices etc nor of any further processing of the flours. As seen in the explanatory notes to chapter 11 above, flours of cereals and flours of dried leguminous vegetable and lentils are classified under chapter 11 if they are obtained only by milling of these raw materials and no further processing has taken place and no addition of other substances with a view for their use as food preparations. If that was the case, they would be classified under CTH 1901 and such products are excluded from chapter 11. Explanatory notes to chapter 1901 also states that it covers food preparations with a basis of flour or meal or starch or malt extract where other substances may be added to main ingredients such as milk, sugar, eggs fat, oil etc. Unprocessed flour obtained only by milling and sieving of cereals, dried leguminous vegetable including peas, lentils etc are to be classified under chapter 1 1 alone. In the i....
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...., Rule 3(c) is applicable i.e. When goods cannot be classified by reference to (a) or (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration. Accordingly, Type V product is to be classified under CTH 11061090. 8. Having decided the classification, the applicable rate of tax is dependent on whether the applicant is using a registered brand name which is defined in Notification No. 1/2017-C.T.(Rate) dated 28.06.2017 as the brand name or trade name, that is to say, a name or a mark, such as symbol, monogram, label, signature or invented word or writing which is registered under the Trade Marks Act, 1999. It is seen from the packaging that the applicant is packing in unit containers and affixing 'Shri Mappillai Vinayagar Mark'. It is not submitted by the applicant whether this is a mark registered under Trade Marks Act, 1999. The rate of tax will depend on this. If the products are packed with such a registered Trade Mark in unit containers, the rate of tax will be :- Type I, II, III, IV and V (CTH 11061090)- 2.5% CGST as per Sl.No. 59 of Schedule I of the Notification No. 1/2017-C.T.(Rate) dated 28.06.2017....