AI Drafter 
TaxTMI 
TaxTMI 
2021 (8) TMI 493
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....he following; 1. Whether chips made from Jackfruit, Banana (both raw as well as ripe banana), Banana chips (masala), Potato, Tapioca, Chembu and Pavakka and sold without BRAND NAME are classifiable as NAMKEENS and are covered by HSN Code 2106.90.99 and taxable under Entry 101A of 1st Schedule of Central Tax (Rate) Notification 1/2017? 2. Whether roasted and salted / salted / roasted preparations such as of Ground nuts, Cashew nut and other seeds are NAMKEENS and when sold without a brand name can they be classified under HSN 2106.90.99 and taxed under Entry 101A of Schedule 1 of Central Tax (Rate) Notification 1/2017? 4. Contentions of the Applicant: 4.1. The Jackfruit Chips and Banana Chips are sold without brand name. Jackfruit chips are made by frying the fruit in edible oil. Banana Chips are made by slicing raw / ripe bananas into thin round pieces and frying in edible oil. Salt and Turmeric are also applied. By adding masala fried banana masala chips are prepared. Thus Jackfruit Chips and Banana Chips are edible preparations and come under the category of savoury. Accordingly, the applicant is levying GST at the rate of 5% by classifying the commodities....
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.... "Chabena" or called by any other name. Such products remain classified in these sub-headings irrespective of the nature of their ingredients. 2106 90 99 Entry Other 4.3. IN RE: P.M. SANKARAN [KER/53/2019 Dated 21^st June 2019] and KER/66/2019 dated SEPTEMBER 30, 2019 of this Honourable Authority, it is held that Jackfruit Chips and Banana Chips fall under HSN 2008.19.40 and have to be classified under Entry 40 of Schedule Il of Notification No. 1 of 2017 and tax at 12% is liable to be paid. Relevant entries are reproduced below for easy reference; Entry 40 / Sch.II of Notfn No.01 of 2017 HSN 2008 Fruits, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included; such as ground nuts, cashew nut roasted, salted or roasted and salted, other roasted nuts and seeds, squash of mango, lemon, orange, pineapple or other fruits. Chapter 20 Chapter Heading Preparations of vegetables, fruit, nuts or other parts of plants. Chapter 20 Chapter Note 1 This chapter does not cover: v) Vegetables, fruit or nuts, prepared or pres....
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....Customs Tariff Act refers to "Other roasted and fried vegetable products", Banana and Jackfruit being not vegetables, its chips cannot be classified under this HSN. 4.5. Further, the Entry in Customs Tariff Act uses the words "roasted and fried". So, it is a cumulative condition. Banana Chips and Jack Fruit Chips are made by frying banana/ jack fruit in edible oil. Being fruits and being not "ROASTED AND FRIED", these cannot be classified under 2008.19.40. In any case, banana and jack fruit are covered by HSN Code 0803 and 0810.90.90 respectively and on this primary ground they cannot be classified under HSN 2008. Advance Ruling IN RE: P.M. SANKARAN [KER/53/2019 Dated 21 st June 2019] ruled that Baked Chips come under HSN 2008 19 40 and taxable at 12% as per Entry 40 of 2 nd Schedule. [Notification No.1/2017/CT (Rate) dated 28.06.2017 & SRO.N0.360/2017]. "From the Ruling, it appears that the applicant himself had conceded that banana chips supplied by him were "baked chips". The Ruling is on the basis of ingredients and classification reported by the applicant and not on an analysis of the products. 4.6. Further, in P. BASHEER vs. STATE OF KERALA [1993] 91 STC (291) it was he....
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....y that particular goods are covered by the said word, those goods should be understood in their natural, ordinary or common parlance as bakery goods. So viewed, we are of the opinion that the mere fact that banana chips, tapioca chips, murukku, achappam, pakkavada and mixture were sold or marketed by the dealer, who is really a baker, cannot be covered by the entry "bakery products" within the meaning of those words as occurring in the Kerala General Sales Tax Act. This is so especially in the context and collocation of words occurring in the First Schedule to the Kerala General Sales Tax Act." 4.7. The ADVANCE RULING NO. KER/66/2019 dated SEPTEMBER 30, 2019, was also a case where applicant himself had raised the query whether Banana Chips, Chakka Chips, Cheema Chakka Chips, Chembu Chips, Kappa Chips, Sharkaravaratty, KovakkaiVattal and PavakkaiVattal are classifiable under HSN Code 2008 19 40 - Other roasted and fried vegetable products and is liable to GST at the rate of 12% as per Sl.No. 40 of Schedule Il of Notification No.01/2017 Central Tax (Rate), dated 28.06.2017. This query was answered by the Authority for Advance Ruling in favour of the applicant. "Applicant had submi....
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....20, it does not cover vegetables, fruit or nuts prepared or preserved by the processes specified in Chapter 7, 8 or 11. It is seen that these processes in Chapter 7, 8, or 1 1 are freezing, steaming, boiling, drying, provisionally preserving and milling. Therefore, any edible part of plant which is prepared or preserved by any other process than these is classifiable under Chapter 20. The banana is sliced, fried and the flavours added. But the essential nature of the product is still the same. As long as the essential nature is retained, the edible parts of plants are classifiable under CTH 2008. [In re: Gourmet Popcornica LLP [TS-491-AAR-2020NT-Tamil Nadu] [2020 (43) GSTL 112 (AAR-GST-TN)] Chips are nothing but an edible part of the plant prepared with salt and oil. Raw banana is also a vegetable and after going through the process of slicing and frying it does not cease to be a vegetable. The Potato, Tapioca, Chembu and Pavakka are sliced, fried and the flavours added. The essential nature of the above products is still the same. Frying and roasting are two popular cooking methods that both use high heat. It would not be right to conclude that both the conditions are to be cumula....
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....the other specific entries for edible preparations. 7.3 The Explanation appended to the Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017 reads as follows; "Explanation:- (1) In this Schedule, tariff item, heading, sub-heading and Chapter shall mean respectively a tariff item, heading, sub-heading and Chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (2) The rules for the interpretation of the First Schedule to the said Customs Tariff Act, 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 above table." 7.4. In view of the above, the rules for interpretation of the First Schedule of the Customs Tariff Act, 1975 including the Section and Chapter Notes and the General Explanatory Notes are applicable for interpretation of the GST Tariff / Rate Schedule. The General Rules for Interpretation of the First Schedule to the Customs Tariff Act, 1975 are as follows; Rule 1: The titles of Sections, Chapters and sub-chapters are provided for ease of reference only; for legal purposes, classificatio....
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.... Rule 4: Goods which cannot be classified in accordance with the above rules shall be classified under the heading appropriate to the goods to which they are most akin. 7.5. Chapter 20 of Customs Tariff Specifically covers 'Preparations of vegetables, fruits, nuts or other parts of plants. As per Chapter Note 1 (a) to Chapter 20, the Chapter does not cover vegetables, fruits or nuts prepared or preserved by the processes specified in Chapter 7, 8 or 11. Therefore, all the vegetable, fruit or nut products or preparations made other than by the processes specified in Chapters 7, 8 or 11 are included in the Chapter 20. The processes specified in Chapters 7, 8 or 11 mainly include freezing, steaming, boiling, drying, provisionally preserving and milling. Therefore, any vegetable, fruit, nut or edible parts of plant which is prepared or preserved by any other process than these are liable to be classified under Chapter 20. Chapter Heading 2008 of the Customs Tariff covers all roasted and fried vegetable products. Frying and roasting are two popular cooking methods that both use high temperature. It is not *necessary that both the conditions are to be cumulatively satisfied for cl....