TaxTMI 
TaxTMI 
TaxTMI 
2023 (9) TMI 162
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..... Sri Venkateswara Cashew Chikky Manufacturers (hereinafter referred to as applicant), registered under the AP Goods & Services Tax Act, 2017. 3. Brief Facts of the case: 3.1 M/s Sri Venkatcswara Cashew Chikky Manufacturers (hereinafter referred to as applicant") is engaged in manufacturing and supply of an edible product under the name "Crackle", which is, as per applicant, identically known and recognised as 'N.B.S Crackle' and contains ingredients in following proportion. Applicant is having GST Registration number 37ABYPV0474E1Z1. S. No Particulars Proportion 1 Sugar 68% to 72% 2 Cashew Nuts 28% to 30% 3 Butter 1% to 2% 4 Glucose 1% to 2% Manufacturing Process of N.B.S. Crackle: step-by-step manufacturing process of, 'N.B.S. Crackle as per the applicant is tabulated here as under: S.No Particulars 1 To begin with, water should be taken in a vessel and to that vessel sugar be added 2 After that, the mixture of those ingredients should be boiled until the mixture is caramelized 3 Once the mixture is caramelized, Cashew Nuts, Butter and Liquid glucose should be added 4 After that, the mixture should be cooled down and mixed in S.S Table 5 ....
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....nary meaning. 5.2 Dictionary meaning of the phrase 'confectionery' Oxford English Dictionary, Second Edition, Part III, where the word is defined as of the nature of confection, cornfit or sweetmeat or pertaining to confections or confectioner's work. As per this Dictionary, the word 'confection' means to prepare for use with sugar, syrup, or the like; to make into a confection; to mix, make up as a condiment or seasoned delicacy. We find that in the same Dictionary, the words confectionery preparation" are defined as a sweetmeat. The word 'sweetmeat' is defined in the Webster's Encyclopaedic Unbridged Dictionary as sweet delicacy, prepared with sugar, honey or the like, as preserves candy, or formerly cakes or pastry. In Fund All Wagnalls New Standard Dictionary confectionary is defined as- "Confectionary is defined as sweet meat. Collectively, that a confectionary makes or sells as candy or other articles made of sugar, sirup honey or the like" In "Word Origins and their Romantic Stones" by Wilfred Funk, on page 346, the Word 'Confetti' is given. We reproduce the relevant portion from the said book: 5.3 "CONFETTI: was once candy Conf....
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....aforesaid discussion, the applicant submits that confectionery comprises articles in which the main ingredients is sugar, although other articles may be added for enhancing its taste. It thus comprises essentially only these articles which are commonly called sweetmeats. Thus, it is clear that it is food chiefly made of sugar. Normally it is made by cooking process, other than baking. Impugned product manufactured by the Applicant contain substantial amount of sugar, and are not made out of the baking process. Therefore, the impugned product primarily falls under the ambit of 'confectionery' products. 5.6 Principles and Classification of Confectionery Products The applicant submits that, confectionery is an important food item of great popularity among wide range of population. It has been enjoyed as a major food delicacy from ancient times. The term confectionery is ambiguous and describes a spectrum of sweet goods and takes on different meaning depending on the country in which it is used, for example in the United Kingdom the term applies to any sweet product including cakes. Globally, confectionery foods represent 50% by volume of foods produced and 60% by value. The ....
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....od Technology, Kakinada, Andhra Pradesh wherein the impugned product N.B.S. Crackle manufactured by the Applicant has satisfied all the parameters laid down under Indian Standard IS 1008:2004 in the said technical test report. Copy of technical test report is enclosed as Annexure-1. 5.9 Classification of NBS Crackle under GST Act: GST Notification 1 of 2017 enlists the rate of tax on goods falling within the ambit of GST. The said Notification has undergone various amendments since inception of GST. Presently, in the above notification, the goods falling under HSN Code 1704 are primarily covered under three schedules i.e. Schedule 1, Schedule II and Schedule III with 5%12% and 18% rates of tax respectively. Items of HSN Code 1704 falling under Schedule I of GST Notification 01/2017: As per GST Notification 41/2017 dated 15.11.2017 read with GST Notification 01/2017, the following items pertaining to HSN Code 1704 are falling under serial number 92 of Schedule 1 of GST Notification 01/2017 with 5% rate of Tax. The relevant extract of serial number 92 is as under: Schedule I -2.5% S.No Chapter Heading/Tariff Item Description of Goods (1) (2) (3) 92 1702 or 1704 Palmyra....
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....arnataka v. Durga Projects Inc. [2018] 91 taxmann.com 54 in its (3) member bench judgment held that only such goods which cannot be brought under specific entries in the tariff could be attempted to be brought in residual entry. 5.11 Hon'ble Supreme Court of India in the case of Dunlop India Ltd. & Madras Rubber Factory Ltd. v. Union of India [19761 2 SCC 241 held that "when an article has, by all standards, a reasonable claim to be classified under an enumerated item in the Tariff Schedule, it will be against the very principle of classification to deny it the parentage and consign it to an orphanage of the residuary clause. Thus when a specific entry is available for enumerating the commodity NBS Crackle to relegate it to the orphanage of the residuary entry will be against the principle of classification as held by Hon'ble Apex Court in the above precedents. Hence NBS Crackle is classifiable under tariff head '1704' enumerated at Serial number 32AA of Schedule II of Notification No. 01/2017, dated 28-6-2017. 6. Personal Hearing: The proceedings of Personal Hearing were conducted on 29.03.2023, for which the authorized representative, T. Bhanu Purdhviraj, CA at....
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....e before us to decide is the classification of the impugned product which is marketed in the name "NBS Crackle" .Thus we proceed to examine, discuss and decide the classification of the afore mentioned product. We invite reference, with regard to the classification of goods under GST, to the notification No. 1/2017-Central Tax (Rate) dated 28.06.2017, chapter heading 1704 and relevant tariff entries therein which are modified vide Notification 41/2017 dated 15.11.2017 and Notification 06/2018 dated 25.01.2018 . We find that the Chapter 17 of the HSN is for 'Sugar & Sugar Confectionery'. While 1701 to 1703 headings relate to Sugars in different forms, the Heading 1704 mentions Sugar Confectionery. Sugar Confectionery has nowhere been specifically defined under GST law or under HSN. However ,going by the trade parlance and prevailing practice, the Sugar Confectionery has been classified under: Chapter/Heading/Sub- Heading/Tariff Item Description of goods GST Rate 1704 Sugar boiled confectionery 12% 1704 SUGAR CONFECTIONERY (INCLUDING WHITE CHOCOLATE), NOT CONTAINING COCOA 18% 17041000 SUGAR CONFECTIONERY (INCLUDING WHITE CHOCOLATE), NOT CONTAINIG COCOA - CHEWING ....