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2020 (8) TMI 907 - AAAR - GSTClassification of goods - HSN code - Papad and papad pipes of different shapes, sizes and varieties (commonly known as Fryums) - - classifiable under Tariff Item 2106 90 99 of the First Schedule to the Customs Tariff Act, 1975 or not - applicable rate of GST - Applicability of Sl. No. 23 of Schedule III of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017, as amended - HELD THAT:- It is now well settled principle of interpretation of statue that the word not defined in the statute must be construed in its popular sense, meaning, that sense which people conversant with the subject matter with which the statue is dealing would attribute to it. It is to be construed as understood in common language. This view has been upheld by the Supreme Court in INDO-INTERNATIONAL INDUSTRIES VERSUS COMMISSIONER OF SALES TAX, UP. [1981 (3) TMI 77 - SUPREME COURT]. The issue of proper classification of the product “Fry Snack Foods called Fryums “and admissibility of exemption notification under Central Excise regime was examined by the Hon'ble Customs, Excise and Gold Appellate Tribunal (CEGAT, as it was known then) in the case of TTK. PHARMA LTD. VERSUS COLLECTOR OF CENTRAL EXCISE [1992 (8) TMI 183 - CEGAT, NEW DELHI] where it was held that the product “Fry Snack Foods called Fryums” have been considered as “Namkeen” and not as “Papad”. It is observed that Fried Fryums are eatable and used as food articles or eatables and such fried, salted Fryums are found to be commonly known and used as “Namkeen”. Further it can be seen that “Papad” even after roasting or frying are known and used as “Papad” only. Whereas, in commercial or trade parlance also, the “Fried Fryums” cannot be said to be known as “Papad”. What will be the classification of “Fried Fryum”? - HELD THAT:- Heading 2106 is an omnibus heading covering all kind of edible preparations, not elsewhere specified or included. Chapter Note 5 provides an inclusive definition of this heading and covers preparations for use either directly or after processing, for human consumption. In 5 (b) above, preparation for use after processing has been included and mentioned therein such as cooking, dissolving or boiling in water, milk or other liquids. Obviously, the term “such as” is purely illustrative but not exhaustive and therefore processing includes frying also, hence fried goods are also covered under chapter head 2106 which is ready for human consumption. Further, Chapter Note 6 pertaining to Tariff item 2106 90 99 also provides inclusive definition and products mentioned therein are illustrative only - it is held that the product “Fried Fryum” is appropriately classifiable under Tariff item 2106 90 99. SI. No. 23 of Schedule III of issued under the CGST Act, 2017 and corresponding Notification No. 1/2017-State Tax (Rate) dated 30.06.2017, as amended, issued under the SGST Act, 2017 covers “Food preparations not elsewhere specified or included (other than roasted gram, sweetmeats, batters including idli/dosa batter, namkeens, bhujia, mixture, chabena and similar edible preparations in ready for consumption form, khakhra, chutney powder, diabetic foods)” falling under Heading 2106. Therefore, Goods and Service Tax rate of 18 % is applicable to the product “Fried Fryums” as per SI. No. 23 of Schedule III of Notification No. 1/2017 Central Tax (Rate) dated 28.06.2017, as amended, issued under the CGST Act, 2017 and Notification No. 1/2017-State Tax (Rate) dated 30.06.2017, as amended, issued under the SGST Act. 2017 or 1GST Act, 2017.
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