TaxTMI 
TaxTMI 
2022 (12) TMI 121
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....OSAM'. The applicant, seeking an advance ruling in respect of the following questions:- (a) What would be the classification of Flavoured Milk for Tea Preparation? (b) What would be the rate of GST Applicable on the said product? 2. At the outset, we would like to make it clear that the provisions of both the CGST Act and the JGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the JGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act/JGST Act would be mentioned as being under the "GST Act". HEARING 3. The case was taken up for preliminary hearing on 03.02.2022/ 04.02.2022 with respect to admission or rejection of present application wherein Shri Aditya Shah, Chartered Accountant attended the proceeding physically and made submissions as per contentions made in Application for Advance ruling. The application was admitted being questions related to 'Classification of goods and rate of GST on said p....
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.... Tea Vendors as their 13213 customers. 7.1 The applicant with regard to the preparation of the said product submitted that the process of preparing Tea Milk:- (i) does not change the essential characteristics of the milk. (ii) It is simple preparation of milk. (iii) No manufacturing process is involved and milk does not change its characteristics in any manner. 7.2 The applicant submitted that Tea Milk is made up of milk added with permitted stabilizers and flavours. The essential characteristic of milk does not change even after adding permitted flavours and stabilizers. It still retains all essential characteristics of milk. Hence, it should be classified under chapter 4 only under Tariff item 0401: 20:00. 7.3 The applicant submitted that the process of Tea milk is standardization of fresh milk according to the fat contents and then heating at certain temperature followed by filtration, pasteurization and homogenization and then mixing of various stabilizers and flavours and finally packaging. The reason for adding stabilizers and flavours is to improve the texture of milk suitable for tea making and increase the taste. 7.4 The applicant sub....
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....Video Conferencing. We also considered the questions/issues on which Advance Rulings have been sought for by the applicant, relevant facts having bearing on the questions/issues raised. Classification 11. In the present case the dealer is intending to prepare Tea Milk. This milk comprises of 99.85% Milk, Flavor (Ginger) 0.05% and Stabiliser 0.1%. lt has fat content of 2%, as declared by the applicant. No sugar or sweetening matter has been added to the said product. The said product is neither UHT Milk nor it is a concentrated milk. The main purpose of this milk is to prepare tea and the dealer intends to sell it to the Tea Vendors and Hotels, Restaurants, Catering (HORECA) segment. Due to its ingredients, stabilizer and Ginger Flavor, its vendors will be able to prepare milk improving the taste and viscosity which will help in preparing more cups of tea with the same amount of milk. It is also seen that the product is having a shelf life of 1 day only under prescribed storage conditions. During the course of hearing it was further submitted by the authorized representative of the dealer, that the said product is purely milk and it shall be used for preparing of Tea. Th....
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....reparation" can be considered a beverage containing milk. In common parlance, a beverage is (chiefly in commercial use) a drink other than water, It is a liquid for drinking especially such liquid other than water (as tea, milk, fruit juice beer) usually prepared (as by flavouring, heating, admixing) before being consumed. The Instant Product, "flavoured milk for Tea Preparation" can't be consumed instantly and it does not contains any additives like sugar or sweeteners for direct consumption. It is moreover, a 'preparation' made as per the description given by the applicant in the flow chart submitted by them. The applicant's product was found to be "Tea Milk" rather than 'Flavoured Milk for Tea Preparation' from which Tea shall be prepared. The final product Tea can be said to be a beverage but not the raw material i.e. "Tea Milk". In view of the above, we find that the product of the applicant, mentioned above, is appropriately classifiable under Chapter 04 under heading 0401 20 00. Rate of GST 12. We have gone through the provisions laid down and notification issued with regard to Milk and Milk products. As per serial number 25 of Notificatio....