TaxTMI 
TaxTMI 
2021 (1) TMI 563
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....h as alphabets, rings, stars etc. 3. Accordingly, the Applicant seeks Advance Ruling on the following questions : (i) Whether any tax is payable in respect of sale /supply of Fryums manufactured by the applicant? And if the answer is in affirmative, the rate of tax thereof? Applicant's interpretation of law : 4. The applicant submitted that it is settled legal position that Fryums are Papad. Since Papad is exempt as per entry at Sr. No. 96 of Tariff item No. 1905 of Not No. 02/2017-CT (rate) dated 28.06.2017, the Fryums manufactured and sold / supplied by the applicant would also be exempt from payment of tax. 5. The applicant has placed reliance on the following judgements of VAT era. Honourable GVAT Tribunal in the case of M/s. Avadh Food Products Vs. State of Gujarat -First Appeal No.1/2015 read with Rectification Application No.31/2015 in First Appeal No.1/2015 Dt;-03/07/2015 reported in 2015 GSTB -II -405 and in the case of M/s. Swethin Food Products Vs. State of Gujarat -2016 GSTB -I 296, Honourable Karnataka High Court in the case of State of Karnataka Vs. Vasavamba Stores -[2013] 60 VST 19 (Karn.)and Honourable Supreme Court in the case of Shiv Shakt....
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..... Thus, if the same are not considered as "papad" only then a resort can be made to the heading 2106 given at Sr. No. 23 of Schedule III of Not. No. 01/2017-Ct (rate) dated 28.06.2017 which is general in nature as it includes food preparations not elsewhere specified or included. Several determining authorities, Honble GVAT Tribunal, Hon'ble Karnatak High Court and Hon'ble Supremee Court of India had an occasion to consider this issue and as all the authorities and Hon'ble Courts have ultimately come to a conclusion that Fryums are papad. The determination orders and judgements have not been reversed by any authority and Court and therefore it has a binding force. The applicant further submitted that whether the relied upon judgements have considered the Customs Tariff Act, 1975 or not is hardly relevant as it is plain interpretation that Fryums are papad. Even if law is amended or new law is enacted, the said interpretation will still hold the field since the Entry No. 96 of Papad is retained. The product under the earlier law would not become something else simply because there is a new law in place. 8. The applicant submitted that Hon'ble Karnataka High Court in the case of S....
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....l the varieties of papad, whether they are circular or flat in shape consisting of all the ingredients whether it is pulses, rice, maida etc. 11. The applicant further submittted that the decision of Hon'ble CEGAT in the case of TTK Pharma Ltd. [1993] 63 ELT 446 (Tribunal) relied upon in the case of Sonal Products (supra) wherein it has been held that Fryums put up in unit containers and ordinarily intended for sale are classifiable under sub-heading 2107.91 as a namkeen. The said judgement of Hon'ble CEGAT has no applicability for several reasons. One, it is with respect to the interpretation of sub-heading 2107. Which no longer forms part of the tariff and hence the goods falling therein have been included elsewhere including heading 1905 which covers "papad". Secondly, it is with respect to interpretation of an exemption notification which referred to the goods falling under 2107 which is not the issue at hand. Lastly, the present issue is concerning the interpretation of the term "papad" and whether the same requires further frying or not and hence whether the same is "namkeen" or not as was the issue in the said judgement. 12. The applicant also submitted that the Hon'bl....
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......... (ii) ...... (iii) "Tariff item", "sub-heading" "heading" and "Chapter" shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of this notification." 18. What is 'Papad' has not been defined or clarified under Customs Tariff Act, 1975, the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the 'CGST Act, 2017), the Gujarat Goods and Services Tax Act, 2017 (hereinafter referred to as the 'GGST Act, 2017'), Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as the IGST Act, 2017 or the Notifications issued under the CGST Act, 2017/GGST Act, 2017/IGST Act, 2017. 18.1 It is now well settled principle of interpretation of statute that the word not defined in the statute must be construed in its popular sense, meaning 'that sense which people conversant with the subjec....
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....ities. 20. The issue of proper classification of the product 'Fry Snack Foods called Fryums' and admissibility of exemption notification under Central Excise regime was examined by the Hon'ble Customs, Excise and Gold Appellate Tribunal (CEGAT, as it was known then) in the case of T.T.K. Pharma Ltd. v. Collector of Central Excise [1993 (63) E.L.T. 446 (Tribunal)]. In this case, the Hon'ble Tribunal, inter alia, observed as follows:- 6. A reading of these sub-headings makes it clear that the product is not a Prasad or Prasadam, Sterilised or pasteurised miltone. Therefore, it will not come within the sub-headings 2107.10 or 2107.20. As the item is not put in a unit container and ordinarily intended for sale, it will not come within the Heading 2107.91. Therefore, the product has to be brought under the residuary sub-heading 2107.99 as 'Other' carrying nil rate of duty. As we have classified the product under the residuary product under the heading "Edible preparations not elsewhere specified or included which carries nil rate of duty, the question of raising any demand or of Excise duty may not arise. However, as arguments have been adduced with regard to the Notificatio....
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....case as such in the aforesaid case the assessee was manufacturing the Fryums and Hon'ble CEGAT has decided that Fryums are Namkeen. Hence in view of the Hon'ble CEGAT decision the applicant product can be equated with "Namkeen" and not with Papad. 20.2 The applicant has contended that the above judgement has no applicability for following reasons that, it is in respect of interpretation of sub-heading 2107 which is no longer forms part of tariff; that it is with interpretation of exemption Notification which referred to the goods falling under 2107 and the present issue is concerning the interpretation of the term "papad" and not whether the same requires further frying or not. The applicant said arguments are not tenable as such applicant is interpreting the aforesaid judgement as per their convenience because in the said case Hon'ble CEGAT was to decide whether the said Product i.e. "Fryums" can be equate with Namkeen or not so that assessee can get benefit the exemption from payment of duty. The assessee (M/s. TTK Pharma) in the case had claimed that their product "Fryums" is a Namkeen and not claimed as "Papad" where as in the exemption entry "Papad, Idli-Mix, Vada-Mix, Dosa....
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....e above inclusive part of the definition shows that only consumables are sought to be included in the term 'cooked food'. In the case of 'fryums' there is no dispute that the dough/base is a semi-food. There is also no doubt that in the case of 'fryums' a further cooking process was required. It is not in dispute that the 'fryums' came in plastic bags. These 'fryums' were required to be fried depending on the taste of the consumer. In the circumstances we are of the view that 'fryums' were like seviyan. 'Fryums' were required to be fried in edible oil. That oil had to be heated. There was certain process required to be applied before 'fryums' become consumable. In these circumstances the item 'fryums' in the present case will not fall within the term 'cooked food' under Item 2 Part I of Schedule II to the 1994 Act. It will fall under the residuary item "all other goods not included in any part of Schedule I". [underlining supplied] 21.1 In this case, Hon'ble Supreme Court was of the view that 'fryums' were like 'seviyan'. 22. The applicant in their application has submitted that such 'different shapes and sizes Fryums are fried and masala powder is added. This is a fact th....
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....e of Subramani Sumathi- Order No. 07/AAR/2019 dtd. 22/01/2019 wherein Tamilnadu Authority of Advance Ruling held that, "Papad - Maida Vadam/Papad made of wheat flour, added sugar and vanaspathi and sun dried being unfinished or semi-finished product which is not ready to eat but can be consumed only after being fried by ultimate consumer, is specifically classifiable as 'papad' under Tariff Item 1905 05 40 of GST Tariff which is exempt from CGST/SGST vide Sl. No. 96 of Notification No. 2/2017-C.T. (Rate) as amended and Notification No. II(2)/CTR/532 (d-5)/2017 vide G.O. (Ms) No. 63." In the said Ruling the Advance Authority was to decide the classification of "Papad" made from "Maida" i.e. fine wheat flour and not the classification of "Fryums". Accordingly, the facts of the said Ruling of the Advance Authority are totally different. Therefore, the said Ruling of Advance Authority is not applicable in the applicant case. Further, as per Section 103 of the CGST Act, 2017 any Advance Ruling is binding on the Applicant who has sought it and on the concerned officer or the jurisdictional officer in respect of the Applicant. Accordingly, AARs Ruling as cited above can't be relied upon i....
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....High Court is in jeopardy, in view of the judgment of Hon'ble Supreme Court in the case of Union of India v. West Coast Paper Mills Ltd. [2004 (164) E.L.T. 375 (S.C.)], wherein it has been held as under - "14. Article 136 of the Constitution of India confers a special power upon this Court in terms whereof an appeal shall lie against any order passed by a Court or Tribunal. Once a Special Leave is granted and the appeal is admitted the correctness or otherwise of the judgment of the Tribunal becomes wide open. In such an appeal, the court is entitled to go into both questions of fact as well as law. In such an event the correctness of the judgment is in jeopardy. .......... .......... 38. In the aforementioned cases, this Court failed to take into consideration that once an appeal is filed before this Court and the same is entertained, the judgment of the High Court or the Tribunal is in jeopardy. The subject matter of the lis unless determined by the last Court, cannot be said to have attained finality. Grant of stay of operation of the judgment may not be of much relevance once this Court grants special leave and decides to hear the matter on m....
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....--Churna for pan kg. 2106 90 80 ---Custard powder kg. ---Other 2106 90 91 ----Diabetic foods kg. 2106 90 92 ----Sterilized or pasteurized millstone kg. 2106 90 99 ----Other kg. 28.3 Chapter Note 5 and 6 of Chapter 21 provides, as follows - "5. Heading 2106 (except tariff items 2106 90 20 and 2106 90 30), inter alia includes : (a) ...... (b) Preparations for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk or other liquids), for human consumption; (c) ...... (d) ...... (e) ...... (f) ...... (g) ...... (h) ...... (i) ...... 6. Tariff item 2106 90 99 includes sweet meats commonly known as "Misthans" or "Mithai" or called by any other name. They also include products commonly known as "Namkeens", "Mixtures", "Bhujia", "Chabena" or called by any other name. Such products remain classified in these sub-headings irrespective of the nature of their ingredients." 28.4 Thus, Heading 2106 is an omnibus heading covering all kind of edible preparations, not elsewhere specified or incl....
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....s with the earlier expressions i.e. municipal corporation, notified area committee, town area committee, town committee." 29.2 The phrase 'by any other name' and 'by whatever name it is known' have a proximate purpose in a statute and hence the principle laid down by the P&H High Court supra will apply on all squares. Therefore, in the instant Case the goods "Papad" cannot be termed as "Fryums" hence applicant goods "fried Fryums" is to be classified under CTH No. 2106 and not under CTH No. 1905 of Custom tariff Act, 1975. 30. Taking all these aspects into consideration, we hold that the product 'different shapes and sizes "fried Fryums' is appropriately classifiable under Tariff Item 2106 90 99. 31. Sl. No. 23 of Schedule III of Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017, as amended vide Notification No. 41/2017-Central Tax (Rate), dated 14-11-2017 issued under the CGST Act, 2017 and corresponding Notification No. 1/2017-State Tax (Rate), dated 30-6-2017, as amended, issued under the GGST Act, 2017 covers "Food preparations not elsewhere specified or included [other than roasted gram, sweetmeats, batters including idli/dosa batter, namkeens, bhujia, mixtu....