TMI Blog2020 (6) TMI 644X X X X Extracts X X X X X X X X Extracts X X X X ..... upplied the FRK to various millers/suppliers with instruction this product should be first mixed (blended) with traditional rice in ratio of 1:100 and then the mixed rice is cooked and consumed. This is an admission of fact by the appellant that FRK is a product different from the traditional rice and to be used for blending in traditional rice - the FRK manufactured by the appellant do not have essential character of natural Rice and also does not merit classification under Chapter 10 in terms of Chapter Note 1 (A) of the said Chapter. It is appropriately classifiable under the sub-heading of Chapter 19 i.e. under Chapter sub-heading 19049000. Appeal disposed off. - RAJ/AAAR/6/2019-20 - - - Dated:- 1-4-2020 - SH. PRAMOD KUMAR SINGH, MEMBER (CENTRAL TAX) DR. PREETAM B. YASHVANT, MEMBER (STATE TAX) Present for the appellant : Shri Samir Jain, Advocate, Shri Sumit Bhargava, CA (Proceedings under section 101 of the Central GST Act, 2017 read with section 101 of the Rajasthan GST Act, 2017) At the outset, we would like to make it clear that the provisions of both the Central GST Act, 2017 and the Rajasthan GST Act, 2017 are same except for certain provisions. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uppliers to the State Nodal Departments like Women Child Development Department for distribution to beneficiaries of the Central Government approved Integrated Child Development Service Scheme (ICDS) and Mid-Day Meals (MDM) etc. 4.2 The appellant is also manufacturer and supplier of Energy Food, Babymix, Indiamix, Paushtik Puffs, Halwa premixes, Khichdi Premixes, Barfi Premix etc., all these products are made of various food grains and fortified with vitamins minerals. 4.3 The appellant preferred an application for Advance Ruling before the Rajasthan Authority for Advance Ruling (hereinafter referred to as the MR ), for declaring the goods manufactured and sold by the appellant i.e., Fortified Rice Kernels (hereinafter referred to as FRK in short), to be taxable under Chapter Heading 10 tariff item 1006 as Rice and description of goods 10061090 other (IGST NIL/5%, CGST NIL/2.5%, SGST NIL/2.5%). The process to fortify rice was also comprehensively laid before the AAR along with the statutory and mandatory requirement of Food Safety and Standards Authority of India, Ministry of Health and Family Welfare, whereby the appellant tried to convince that the FRK is nothing but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... market separately without blend the same in rice. 5.6 The Rice is specified in Chapter 10 of the Tariff and further includes Rice in husk (paddy or rough), husked (brown) rice, semi-milled or wholly-milled whether polished or glazed, basmati rice, broken rice parboiled rice. Therefore, from the said it is apparently clear that Chapter 10, apart from the natural form of rice also contains processed rice. Accordingly, the contention of the Ld. AAR 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, cannot be accepted. 5.7 The reference is drawn to Chapter Note 1(B) appended to the Chapter 10, which reads as under: (B) The Chapter does not cover grains which have been hulled or otherwise worked. However, rice, husked, milled, polished, glazed, parboiled or broken remains classified in heading 1006. The Chapter Note, itself is categorically clear that otherwise worked grains are not included, however, rice otherwise worked are included in heading 1006. FRK being fortified rice cannot be expelled from the said category and therefore, even if FRK does not finds its mention unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e heading of Chapter 19 itself, does not cover the goods, resorting to, chapter note is nothing but absolute wrong interpretation. 5.12 It is again one of the general rule of interpretation that any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as presented, the incomplete or unfinished article has the essential character of the complete or finished article. It has already been clarified that FRK has the essential characteristics of rice rather it nothing but fortification of natural rice thereby making it more nutritious keeping intact its essential characteristics and form as well as the use. Therefore, FRK albeit if not mixed with rice, then also can be classified under Chapter 10 because when FRK being mixed with the rice the end use, characteristics and form would be exactly the rice. PERSONAL HEARING 6. A personal hearing in the matter was held on 17.03.2020. Shri Samir Jain, Advocate, and Shri Sumit Bhargava, authorized representatives of the appellant, appeared for personal hearing on 17.03.2020. They reiterated the submissions already made under grounds of appeal. They also s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from them. DISCUSSION AND FINDINGS 7. We find that the appellant vide its application filed before the Rajasthan Authority for Advance Ruling, had requested for Advance Ruling on the following point:- Whether the goods Fortified Rice Kernels ( FRK ), manufactured and sold by M/s JVS Foods Pvt. Ltd. will be fall under Chapter-10, Tariff item 1006 as Rice and description of goods 10061090 others (IGST NIL/5%, CGST NIL/2.5%, SGST NIL/2.5%)? 8. In pursuance of the aforesaid application, the Rajasthan Authority for Advance Ruling in its Ruling No. RAJ/AAR/2019-20/27 dated 28.11.2019 = 2020 (1) TMI 1006 - AUTHORITY FOR ADVANCE RULING, RAJASTHAN , has pronounced its Ruling as under: Fortified Rice Kernels (FRK), manufactured and supplied by the applicant is classifiable under HSN 19049090 and attracts GST 18% (SGST 9% + CGST9%). 9. The appellant is not satisfied with the above Ruling and has therefore, filed the present Appeal before this forum. 10. During the course of the personal hearing the appellant reiterated the points as stated in Grounds of Appeal and also submitted additional submissions. 11. We have carefully gone through the appeal pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10063010 --- Rice, parboiled kg. 70% - 10063020 --- Basmati rice kg. 70% - 10063090 --- Other kg. 70% - 10064000 - Broken rice kg. 80% - While going through the above classification of Rice under Chapter 10, we find that rice in natural form including rice after certain processing like husking, milling, parboiling etc. fall within the ambit of Chapter Heading 1006. 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. We find support from the Chapter Note 1 of Chapter 10 which mentions as below- 1. (A) The products specified in the headings of this Chapter are to be classified in those headings only if grains are present, whether or not in the ear or on the stalk. (B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods obtained from unroasted cereal flakes or from mixtures of unroasted cereal flakes and roasted cereal flakes or swelled cereals 19043000 -Bulgur wheat 19049000 - Other The relevant extracts of Note to Chapter 19 are as below: 4. For the purposes of heading 1904, the expression otherwise prepared means prepared or processed to an extent beyond that provided for in the headings of, or Notes to, Chapter 10 or 11 15. We also note that the appellant supplied the FRK to various millers/suppliers with instruction this product should be first mixed (blended) with traditional rice in ratio of 1:100 and then the mixed rice is cooked and consumed . This is an admission of fact by the appellant that FRK is a product different from the traditional rice and to be used for blending in traditional rice. 16. The appellant has also contended that the AAR has not considered the heading pertaining to Puffed rice, commonly known as Muri, flattened or beaten rice, commonly known as Chira, parched rice, commonly known as khoi, parched paddy or rice coated with sugar or gur, comm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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