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TMI Blog2020 (1) TMI 1006X X X X Extracts X X X X X X X X Extracts X X X X ..... td., G-220, Sitapura Industrial Area, Jaipur, Rajasthan 302006 (hereinafter the applicant) is fit to pronounce advance ruling as it falls under the ambit of the Section 97 (2) (a) & (e) given as under: - a. Classification of goods and /or services or both e. Determination of the liability to pay tax on any goods or services or both * Further, the applicant being a registered person (GSTIN is 08AAACJ4620Q1ZA as per the declaration given by him in Form ARA-01) the issue raised by the applicant is neither pending for proceedings nor proceedings were passed by any authority. Based on the above observations, the applicant is admitted to pronounce advance ruling. 1. SUBMISSION AND INTERPRETATION OF THE APPLICANT: * The applicant having its registered office at G-220, RIICO, Sitapura, Industrial Area, Tonk Road, Jaipur. Rajasthan-302022 incorporated in the year 1995, is one of the largest producers of Institutional Foods in the state of Rajasthan. The applicant is catering to the requirements of United Nations Food Aid Agency, World Food Programme, in India, and in neighboring countries too. Its products are also supplied to State Nodal Departments like Women & Child Developme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he "Anemia Mukt Bharat" (Anemia Free India) initiative under Poshan Abhiyan has highlighted the need for mandatory provision of iron folic acid fortified foods in public health programs in addition to deworming, food supplementation, and dietary diversification. * The Process to Fortify Rice consists of Two Main Steps: - * Create Fortified Rice Kernels. Blend of Rice Flour & Vitamin-Minerals Premix is Extruded in Shape of rice to form Fortified Rice Kernels Blend Fortified Rice Kernels with Milled/ Traditional Rice in Ration of 1:100. (The Diagrammatic Chart is also enclosed with the submission. Also, The Process Flow Chart for manufacturing FRK is Attached with the Submission*) * The applicant is always being a name in the business of fortification and always take first step to adopt new & product and in the same step has entered in manufacturing and supply of new product named as Fortified Rice Kernals (FRK). FRK (Fortified Rice Kernels) used for rice fortification is a value added product made from rice flour and micronutrient premix. But Currently GST slab applicable on the sale of FRK is not clear to FRK producers. 2. QUESTIONS ON WHICH THE ADVANCE RULING IS SOUGH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orceable right) 5% 10061090 10 "Milk is classified under heading 0401 and as per S. No. 25 of notification No. 2/2017- Central Tax (Rate) dated 28.06.2017. fresh milk and pasteurized milk, including separated milk, milk and cream, not concentrated nor containing added sugar or other sweetening matter, excluding Ultra High Temperature (UHT) milk falling under tariff head 0401 attracts NIL rate of GST. Further, as per HSN Explanatory Notes, milk enriched with vitamins and minerals in classifiable under HSN code 0401. Thus, it is clarified that toned milk fortified (with vitamins A" and D') attracts NIL rate of GST under HSN Code 0401" 7. As per GST Council by is clarified has been done Milk enriched vitamins or minerals salt (Fortified Milk) would be classifiable under HSN code 0401 as milk, and hence, was exempted from GST. There was a confusion as to fortified milk being a value-added product or just a vitaminised product kept the FBOs wondering. Initially, the fortified milk was considered as the value-added product and 12% GST was levied on it. But lately, it has been concluded that fortified milk is nothing but a vitaminised milk enriched with mineral salts. The GST C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t cover grains which have been hulled or otherwise worked. However, rice, husked, milted, polished, glazed, parboiled or broken remains classified in heading 1006. In view of above, we find that rice in its natural form with its essential characteristics as intact is classified in Chapter 10, and FRK is not covered in the said chapter. * Whereas in the process of manufacture of FRK, we find that essential characteristics of rice is changed, its property is changed from granule to flour, which disqualifies its classification in Chapter 10 as similar to rice or a form of rice. Another characteristic feature of FRK is that it cannot be consumed in itself but only when it is mixed with normal rice in defined proportion. Whereas, the products classified in Chapter 10 are eatable/consumable after boil and do not require any other admixing. Both these differentiations do not allow its classification in Chapter 10. * Further, preparations/ processes on rice which are beyond the scope of Chapter 10 have been classified in Chapter 19 of GST Tariff. The relevant extract of said chapter note (Chapter 19) is as below- 4. For the purposes of heading 1904, the expression "otherwise prep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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