TaxTMI 
TaxTMI 
2021 (8) TMI 838
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.... and testing. (g) The flour mix is thereafter packaged and stored for dispatch. 3. Table showing constituent components of instant mix flours(as per table Annexure-B(revised) submitted by them on 2-7-21) is as under: Sr.No. Product Name (A) Dried Leguminous Vegetable Flours (B) Rice & Wheat Flours Total Flours (A+B) (%) (C) Additives (D) Spices Total (A+B+C+D) (%) Bengal Gram (Chana Dal) (%) Black Gram (Udad Dal) (%) Green Gram (Moong Dal) /Red Gram (Toor Dal)% Total (%) Rice Flour (%) Refined Wheat Flour (%) Wheat Flour (%) Total (%) Additives (%) Name of Additives Spices (%) Name of Spices 1 Gota Instant Mix Flour 400 gm (including chutney powder of 40 gm) 66.60 66.60 0.00 66.60 25.60 Sugar, Iodised Salt, Raising agent (Sodium bicarbonate INS 500(ii)), Acidity regulator (Citric acid INS 330) 7.80 Chilli Powder, Garam Masala Powder, Black Pepper Crushed, Coriander Crushed, Ajwain, Fennel 100.00 1A Chutney Powder 40 gm Crushed Sugar, Iodised Salt, Acidity regulator (Citric acid INS 330) Amchur Powder, Chilli Powder, Cumin Powder, Coriander Powder 2 Khaman Instant Mix Flour 400 gm (including masal....
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....00 gm 15.00 8.00 15.00 38.00 33.00 8.00 41.00 79.00 19.00 Sugar, Iodised Salt, Acidity regulator (Citric acid INS 330), Raising agent (Sodium bicarbonate INS 500(ii)) 2.00 Chilli Powder, Turmeric Powder 100.00 4. Diagrammatic process flow chart is as follows: 5. The Schedule entry as contained in Schedule I of Notification No. 1/2017 - Central Tax (Rate) dated 28.6.2017 reads as follows: S.No. Chapter /Heading /Sub-heading/ Tariff item Description of Goods Rate of tax 54. 1101 Wheat or meslin flour put up in unit container and,- (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available other than those where any actionable claim or any enforceable right in respect of such right has been voluntarily foregone subject to conditions as in the Annexure 2.5% CGST + 2.5% SGST 55. 1102 Cereal flours other than of wheat or meslin i.e. maize (corn) flour, Rye flour, etc. put up in unit container and,- (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available other than those wher....
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....Interpretation 1. The General Rules of interpretation of customs tariff have been specifically borrowed by clause (iv) of the Explanation to the Rate Notification which reads as follows: "Explanation. - For the purposes of this notification,- (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." 2. The relevant extract of such rules of interpretation of Customs tariff reads as follows: "2(b) Any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combinations of that material or substance with other materials or substances. Any reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classification of goods consisting of more than one material or substance shall be according to the principles of rule 3. 3. When by application of Rule 2(b) or for any other reason, goods are, prima facie, classifia....
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....nated sheet is its rigidity or strength and its resistance to heat and moisture. These are essentially characteristics which are imparted by resins. Paper does not process any of these characteristics. Therefore, applying Rule 3(b) and going by the essential characteristics of such laminated sheets, these goods are more appropriately classifiable under chapter 39." The aforementioned judgement is squarely applicable in the case of the applicant. 6.6 The applicant is further supported in its contention by a circular no. 80/54/2018-GST dated 31.12.2018 issued by the Central Board of Indirect Taxes and Customs wherein the following has been clarified with regard to classification of "Sattu" and is squarely applicable to this case: "3. Applicability of GST on Chhatua or Sattu: 3.1 Doubts have been raised regarding applicability of GST on Chhatua (Known as "Sattu" in Hindi Belt). 3.2 Chhatua or Sattu is a mixture of flour of ground pulses and cereals. HSN code 1106 includes the flour, meal and powder made from peas, beans or lentils (dried leguminous vegetables falling under 0713). Such flour improved by the addition of very small amounts of additives continues to be classified ....
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....ent or even file an appeal against the correctness of the binding nature of the Circulars issued by the Board. Similar is the view taken by this Court in the case of Collector of Central Excise, Bombay v. Kores [India] Ltd. 1997 (89) ELT 441 (SC)." 6.8 The applicant further points out that for the same products Kitchen Xpress Overseas Limited had filed application for determination under Section 80 of the Gujarat Value Added Tax Act, 2003 (herein after referred to as "the Vat Act"). The relevant entry for consideration before the determining authority was Entry 12(ii) of Schedule I to the Vat Act which read as "Flour of cereals and pulses except maize flour". The learned determining authority by order no. 2010/D/171-177/No. 356-359 dated 12.8.2010 held that instant flour mixes such as gota flour, khaman flour, dalwada flour, dahiwada flour, idli flour, dhokla flour and dosa flour were classifiable under Entry 12(ii) of the Vat Act. 6.9 The applicant has submitted that determination orders passed under the Vat Act which was the legislation preceding the GST Acts are relevant for the purpose of deciding classification under the GST Acts. The applicant relies upon the judgement of H....
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....n. Supreme Court: (a) Ayurveda Pharmacy v/s State of Tamil Nadu (1989) 2 SCC 285; (b) State of Uttar Pradesh v/s Deepak Fertilizers & Petrochemical Corporation Ltd. (2007) 10 SCC 342. 7.2 The applicant clarifies that they are aware of the technical criteria for flour to be classifiable under heading 1101/1102 as contained in General Chapter Note 2(B) of the HSN. The applicant submits that the flour mixes containing rice/wheat flour fulfill such criteria. Presuming for the sake of argument that the criteria is not fulfilled, even then such flour mix will be classifiable under the following entry: S.No. Chapter / Heading /Sub-heading / Tariff item Description of Goods Rate of tax 103A. 2302 Bran, sharps and other residues, whether or not in the form of pellets, derived from the sifting, milling or other working of cereals or of leguminous plants [other than aquatic feed including shrimp feed and prawn feed, poultry feed and cattle feed, including grass, hay and straw, supplement and husk of pulses, concentrates and additives, wheat bran and de-oiled cake]"; 2.5% CGST + 2.5% SGST The applicant states that they are squarely supported in their submission by the adva....
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....n.- A supply of a package consisting of canned foods, sweets, chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be supplied separately and is not dependent on any other. It shall not be a mixed supply if these items are supplied separately;" 8.3 Thus if two or more supplies are naturally bundled in the ordinary course of business then they are "composite supply"; otherwise they are "mixed supply". In the instant case, the chutney powder/kadhi chutney powder is naturally bundled along with the gota flour mix. They are meant for consumption together in ordinary course. Therefore, this supply being composite supply, the classification would be in the heading for the principal supply i.e. flour under heading 1106. 8.4 Alternatively, presuming for the sake of argument that the supply of gota/methi gota instant flour mix with chutney powder is "mixed supply" and not "composite supply", the classification of chutney powder is under Entry 100A of Schedule I to the rate notification which reads as under: S.No. Chapter /Heading /Sub-heading /Tariff item Description of Goods Rate of tax 100A 2106 ....
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....e of tax for the principal supply i.e. khaman mix flour. The masala pack is a mixture of chana dal flour along with sodium bicarbonate. It can only be used for making the khaman. The masala pack is therefore naturally bundled in the ordinary course of business along with supply of khaman and therefore in any case the composite supply is taxable at the rate of 2.5% CGST + 2.5% SGST. 10. The applicant vide their additional submission dated 28-6-21 submitted that Instant mix flour of idli/dhosa manufactured by Ramdev Food Products pvt.ltd. is nothing but idli/dhosa batter for the simple reason that a batter is a flour from which idli/dhosa is prepared; that similarly instant mix flour products of idli/dhosa is a flour from which idli/dhosa is prepared; that as there is no specific entry for idli/dhosa batter along with roasted gram and chutney powder, which means that all basic flours or mixtures for preparation of idli/dhosa falls under this entry and should be classified under tariff heading no.2106 with GST @5%. 10.1 The applicant has further submitted that as per Circular No.80/54/2018-GST dated 31.12.2018 issued by CBIC, Chhatua or Sattu is a mixture of flour of ground pulses a....
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...., khaman, dalwada, dahiwada, idli, dhokla, dhosa, pizza, methi gota and handvo? (b) What is the applicable rate of tax under the GST Acts on supply of instant mix flour for gota/methi gota along with chutney powder/kadhi chutney powder? (c) What is the applicable rate of tax under the GST Acts on supply of khaman along with masala pack? Personal hearing 12. Shri Manan Shah, C.A. and Shri Hardik Bhatt, Manager appeared on 306-21and reiterated the contents of the application. FINDINGS 13. At the outset we would like to make it clear that the provisions of CGST Act, 2017 and GGST Act, 2017 are in parimateria and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the GGST Act. 14. We have carefully considered all the submissions made by the applicant. 15. We hold that Classification of goods under GST is based on HSN. The customs Tariff is based on HSN. The general Interpretative Rules are to be sequentially followed as the way to classify the goods. W....
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....er Heading 07.13 and other specified products. On inspection of the Packets of each product, we find that each of the packet is marked ' Instant Mix'. On examination of the list of ingredients we find that Spices and additives apart from flour of dried leguminous vegetables, rice and wheat are contained in different proportions. The Spices and additives contained in these products include Sugar, Iodised Salt, Red Chili Powder, Garam Masala, Black Pepper, Coriander, Ajwain , Fennel, Raising agent(Sodium bicarbonate INS 500(ii)), Acidity Regulator (INS 330) means Citric Acid etc. The proportion of Spices and additives contained in these products ranges from 5% to 33.4%. The proportion of Spices and additives is 11% in Khaman Flour, 33.4% in Gota Flour, 8% in Dalwada Flour, 6.5% in Dahiwada Flour, 29.25% in Methi Gota Flour. As the products of the applicant contain Spices and additives in different proportions, which are not mentioned in the Chapter Heading 11.06 or the relevant Explanatory Notes of HSN. The applicant has referred to CBIC Circular No. 80/54/2018-GST dated 31.12.2018, which has inter-alia clarified the applicability of GST on 'Chhatua or Sattu'. The CBIC has clarified ....
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....o their use as food preparations are excluded (generally heading 19.01). This heading also excludes flours mixed with cocoa (heading 18.06 if they contain 40% or more by weight of cocoa calculated on a totally defatted basis, or heading 19.01, if less) 11.02 Cereal flours other than of wheat or meslin. 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 this heading may be improved by the addition of very small quantities of mineral phosphates, anti-oxidants, emulsifiers, vitamins or prepared baking powders (self raising flour). The heading also covers 'swelling' (pregelatinised) flours which have been heattreated to pregelatinise the starch. The....
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....e submitted by the applicant that the Spices and additives have been added to the flours with a view to their use as food preparations. As such, in view of the Explanatory Notes of the HSN, these products are excluded from the Chapter Heading 1101 and 1102. 20. The applicant has also contended that their Instant mix flours of Idli and Dhosa are nothing but idli/dhosa batter for the simple reason that batter is a flour from which idli/dhosa is prepared; that there is a specific entry for idli/dhosa batter along with roasted gram and chutney powder and is classifiable under heading no.2106 with GST @5%. In this regard, we find that entry referred to by the applicant appears at Entry No.100A of Schedule-I of Notification No.1/2017-Central Tax(Rate) dated 28-6-17 on which GST rate is 5% and reads as under: S.No. Chapter/Heading/ Subheading / Tariff item Description of goods 100A 2106 Roasted gram, idli/dosa batter, chutney powder In this regard, we find that the idli mix or dhosa mix are completely different from idli/dhosa batters. Idli/Dhosa batters are in semi- liquid form which can be directly poured on to the frying pans for preparation of idlis and dhosas. The difference ....
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....re for cooking as mentioned on the packets of all the said products, then ready for human consumption. The applicant submitted that the products are not 'in ready to consume form' but needs to be subjected to further processing and cooking for conversion into 'ready to eat food'. We find that Chapter Heading 2106 is not confined to processed or semi processed food, cooked or semi cooked food, preserved food and ready to eat food. In fact, a food preparation which is not elsewhere specified in the HSN, gets covered under HSN 2106. On the packets of all the above products-Category: Instant Mix has been printed on the packets and the detailed procedure recipe is printed on back side of the packets. We find no merit to treat the subject goods as flour. As these products are not specifically mentioned under any specific Tariff item, the products merit classification under the residual entry "other" at HSN 210690. We are of the view that the 10 products of Mix Flour/ Instant Mix Flour are appropriately classifiable under HSN 2106. 24. We note that Central excise Tariff 2106 is also based on HSN. We find that our stand is in compliance and consonance with the case law Commissioner of Cen....
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....ttracting Goods and Services Tax @ 5% or 12%. None of the aforesaid 10 products of various Instant Mix / Ready Mix Flour being supplied by the applicant are the products which have been excluded from the entry at aforesaid Sr. No. 23 of Schedule - III or which have been specifically included in any other entry of other Schedule of Notification No. 1/2017-Central Tax, as amended or in any of the entries of Notification No. 2/2017-Central Tax. 27. Further, the applicant has requested to consider the ruling of the Gujarat Advance Ruling Authority issued vide its Order No. GUJ/GAAR/R/43/2020 dated 30-7-20 in the case of Dipakkumar Kantilal Chotai (Talod Gruh Udhyog). In this regard, it is pertinent to mention that the said Ruling is not applicable in the applicant's case because as per Section 103 of the CGST Act, 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. Also it is on record that the said Advance Ruling dated 30-7-20 has been appealed before the Appellate Authority for Advance Ruling vide Application number Advance/SGST & CGST/2020/AR/17 and decided by the Gujarat Appellate ....