TaxTMI 
TaxTMI 
2024 (12) TMI 784
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....milk and milk products. As part of its business, the petitioner processes and sells, flavoured milk, to customers within and outside the State of Andhra Pradesh. For the purpose of payment of tax, on the sale of flavoured milk, the petitioner had filed its returns by placing the product "flavoured milk" in Tariff Heading No.0402 99 90 (hereinafter referred to as 402). The 1st respondent, while considering the returns filed by the petitioner for the period July, 2017 to July, 2019 had rejected the classification placed by the petitioner and held that flavoured milk would fall under GST Tariff Heading No.2202 9930 (hereinafter referred to as 2202). The 1st respondent had accordingly passed orders, by way of an order in Original No. 14/2023-24....
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.... description is 'Beverages containing Milk'. It is general understanding that in public parlance 'Flavored Milk' is distinguished from normal Milk. It is consumed as a drink, and not merely as milk. Though added in a small quantity, the added flavor changes the public perception to a special drink from mere milk. The Oxford dictionary meaning of 'beverage' is 'any type of drink except water'. Thus, the impugned goods are drink containing milk i.e. a beverage containing Milk. Therefore, I hold that classification under Chapter Heading 22029030 is the most specific description as per the guideline given under Rule 3(a) of General rules of Interpretation of Customs Tariff Act, 1975. 4. The 1st respondent passed the impugned order o....
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.... of Section 122 (2) (b) read with Section 74 of the GST Act would be applicable, making the petitioner liable to pay penalty under these two provisions, on the short fall of tax paid. 6. The petitioner, relying upon the Food Safety and Standards (Food Products Standards & Food additives) Regulations, 2011 contends that 'flavoured milk' would fall within the meaning of "Milk" set out in 0402. The petitioner would contend that the Tariff Heading, claimed by the petitioner, includes milk containing sugar or other sweetening matter, and since flavoured milk, processed by the petitioner, consists of approximately 90.5% of milk and 9% of sugar apart from 0.5% of artificial natural flavorings and permitted colour, the same would fall within the....
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.... also been raised on the ground that questions of classification should be left to the tribunals, set up under taxation statutes, and the scope of judicial review should not be extended to such issues. Consideration of the Court: 9. At the outset, the preliminary objection relating to the maintainability of the writ petition needs to be addressed. Though, the contention of the respondents that matters of classification should be best left alone to the tribunals does bear consideration, the fact remains that the writ petition has been pending before this court for the past one year and it would not be fair to relegate the petitioner to the remedy of appeal, especially when the period for filing such an appeal has lapsed. In any event, ....
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.... heading 0402 99 90 is that flavoured milk, with the addition of Badam flavour, ceases to be milk and becomes a special drink. Entry 0402 at the cost of repetition, reads as follows: First Schedule of Section-I Tariff Item-0402 Milk and cream, concentrated or containing added sugar or other sweetening matter. Milk and cream, concentrated or containing added sugar or other sweetening matter including skimmed milk powder, milk food for babies (other than condensed) 12. The first issue that comes up is whether only milk is to be treated under 0402. The said entry not only enumerates milk per se but also cream, skimmed milk powder, milk food for babies etc. It includes even plain or concentrated milk containing sugar or other....
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....ter, mineral water, aerated water and other beverages which can be made only by using water. Except entry 2202 90 90, "Tender coconut water", water is an essential part of the beverages mentioned therein. Applying the principle of Nocitur a Sociis, the placement of Tariff Item 2202 90 30 in the same tariff heading would mean that entry 2202 99 30, would cover beverages which contain milk as well as water. 14. Another way of looking at this issue is to consider sweetened milk. In a case where sweetened milk is to be sold, after bottling the same, it would fall within the meaning of Milk containing added sugar or other sweetening matter, under 0402. This drink could also be called a beverage, containing milk, falling under 2202. The entry,....