TMI Blog2020 (6) TMI 481X X X X Extracts X X X X X X X X Extracts X X X X ..... SGST or 18% IGST. - GUJ/GAAR/R/03/2020 (In Application No. Advance Ruling/SGST&CGST/2018/AR/13) - - - Dated:- 11-3-2020 - SANJAY SAXENA AND MOHIT AGRAWAL MEMBER Present for the applicant : Shri Kulin B. Shah, Advocate BRIEF FACTS The applicant has submitted that they are a proprietorship concern and manufacture Pop Corn, which is sold in a sealed plastic bag bearing a registered brand name as [J.J.'s] POPCORN, under the Trade Marks Act, 1999. They submitted that their product is manufactured by using corn/maize grains. The Raw corn - grains are heated in an electric machine/oven @ 180/200 degree temperature and due to the heat so given to the grains, they turn into puffed corns/popcorns which are known in Gujarati language as dhani which is similar to that of puffed rice/ known as murmura. Then after they are sieved so as to remove some grains which are left unpuffed. During the process Salt, Edible Oil and Turmeric Powder are mixed in required quantity. Thereafter the product is packed in a plastic pouch in quantity of 15 gm. The applicant also submitted a Tax Invoice issued by them, bearing No. GT/411 Dt. 24-02-2018 for gross value of ₹ 3920/- (Incl. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05 of Schedule I and is taxable accordingly. The applicant also submitted that though this judgment is under the provision of The Central Sales Tax Act 1956, but it is still as relevant as was at earlier time laying down the principle for determining the classification of commodity and the principle laid down therein is that a cereal grain, even after applying a process of heating, it does not lose its basic characteristics and thus it remains the same cereal grain and this principle is applicable squarely also to Maize as popcorn. The applicant also clarified that the above commodity is classified under Chapter 10, which is for CEREALS and as per the above judgment, though a simple process of heating is done on Maize and to make it palatable other ingredients like salt and turmeric powder are added to it, still it remains a Cereal grain and further clarified that the use of negligible quantity of oil is only for the purpose of sticking the salt and turmeric on the maize/corn, and not for cooking/frying. 4. The applicant further placed reliance on a judgment delivered by High Court Gujarat in the case of M/s Vadilal Wafers Company (S. T. Reference No.31 of 1980 Dt. 24-02-1982) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the classification of the said product, it will be leviable to appropriate rate of Goods and Services Tax prescribed under Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 issued under the Central Goods and Services Tax Act, 2017 (herein after referred to as the CGST Act ) and corresponding notifications issued under the Gujarat Goods and Services Tax Act, 2017 (herein after referred to as the GGST Act ) or the Integrated Goods and Services Tax Act, 2017 (herein after referred to as the IGST Act ). 8. It is observed that the Explanation (iii) and (iv) to the Notification No. 1/2017Central Tax (Rate) dated 28.06.2017 provides as follows :- [ Explanation . - For the purposes of this notification, - (i) ......... (ii) .......... (iii) Tariff item , sub-heading heading and Chapter shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... UPREME COURT , has, while distinguishing between ordinary popcorn and eclair popcorn, held that an ordinary popcorn as against eclair popcorn would bring out the distinction between the foods obtained by swelling or roasting of cereals and food obtained by process involving use of other ingredients like eclair. 12. It is also observed that there is no specific entry for the product POP CORN in Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017. But there is an entry most akin to the product and process ( chapter heading 1904 ) at Sr. No. 15 of Schedule III of Notification No.1/2017 CENTRAL TAX (Rate) Dated 28-6-2017 and attracts 9% CGST and 9% SGST or 18% IGST. The Entry, at sr. No. 15, in the Schedule III is as follows: SCHEDULE III - 9% S.No. Chapter / Heading / Sub-heading / Tariff item Description of Goods (1) (2) (3) 15 1904 All goods i.e. Corn flakes, bulgar wheat, prepared foods obtained from cereal flakes [other than Puffed rice, commonly known as Muri, flattened or bea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion that their product may be held to fall under Sr. No. 57 of Schedule I of Notification No.1/2017 CENTRAL TAX (Rate) Dated 28-6-2017, is not acceptable on the grounds that this entry pertains to Chapter Heading 1104, which is meant for Cereal grains otherwise worked . Note 1 to the Chapter 11 clearly mentions that this Chapter does not cover: (a) roasted malt put up as coffee substitutes (heading 0901 or 2101); (b) prepared flours, groats, meals or starches of heading 1901; (c) corn flakes or other products of heading 1904;..... Since the applicant s product matches the description at heading 1904, it does not deserve to be classified in the chapter 11. 15. In view of the foregoing, we rule as under R U L I N G The product namely [J.J. s] POP CORN , manufactured from raw corn/maize grains, which, by heating turn into puffed corns/popcorns and then to make it palatable other ingredients like salt and turmeric powder along with oil are added to it fits the description as Prepared foods obtained by the roasting of cereal . This description attracts classification under Chapter Sub-Heading 1904 10 of the First Schedule to the Customs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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