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2019 (11) TMI 1366 - AAR - GSTClassification of goods - rate of GST - fruit beverages or drinks 'K Juice Grape' - scope of definition under the FSSAI Act in section 2.3.3.A - Is there any persevered percentage of fruit or pulp in the beverages to call them as carbonated fruit beverages or drinks under the GST Act? - whether the said product fall under the category of fruit beverages or fruit based drinks? HELD THAT:- The label of the product have the description “Carbonated Fruit Beverage”. As per the label, the ingredients are Carbonated water, sugar, grape juice, acidity regulator, etc. It also has permitted flavour and colour - as per the classification of FSSAI, Fruit juices are unfermented but fermentable product obtained by a mechanical process from sound, ripe fruit or the flesh thereof and processed by heat, in an appropriate manner, before or after being sealed in a container, so as to prevent spoilage and are intended for direct consumption. In the instant case, the product is made by adding fruit juices to large quantities of water along with other preservatives which then goes through a carbonation process. The juices are not meant for direct consumption here but are just one ingredient of the drinks - fruit juices and carbonated beverages with fruit drinks are distinct products in the FSSAI regulations and the product of the applicant is not thermally processed fruit juice but covered under Para 2.3.30 of the regulations and Category 14.1.4.1 in the food category system in Appendix A to these regulations. In the instant case, water constitutes around 76% in the products in question. The product is prepared by adding fruit juice, procured by the applicant (as per the letter addressed to the applicant by Food Systems Asia), to RO water. It is evident that this large quantity of water results in diluted product which as per the Explanatory Notes above gets classified under CTH 2202 - In the case at hand, the manufacturing process of the products involves addition of Grape juice (13%) to the filtered sugar solution (86%-76% RO water and 10% Sugar) in a blending tan which is subjected to Mild Thermal Treatment (loss of water by 2 to 3%), cooled to room temperature, to which additives and preservatives as per the formulation and coloring & flavoring agent are added. Waters with added carbon dioxide which may contain added preservatives and flavoring, sugars are separately classified under Para 2.10.6 as ‘Carbonated Water’ and Category 14.1.1.2 as ‘table waters and soda waters’ which are different from ‘Carbonated Fruit Beverages or Fruit Drinks’ of Para 2.3.30 and Category ‘14.1.4.1’ of FSSAI regulations - the applicants product is classified under Para 2.3.30 of FSSAI and not para 2.10.6. It is evident that the ‘carbonated water’ described in Para 2.10.6 of FSSAI regulations are the ‘Aerated Waters’ covered under CTH 22021010. Therefore, the applicant’s product is not classifiable as ‘Aerated Waters’ under CTH 22021010 and the product commercially named as ‘K juice Grape’ is classifiable under CTH ‘22021090- Other’ as it contains the Grape fruit juice with added natural and artificial flavours.
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