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TMI Blog2020 (7) TMI 473X X X X Extracts X X X X X X X X Extracts X X X X ..... assification of the product -Preparation of a kind used in Animal Feeding - Bio Processed Meal" falling under HS Code 23099090. The applicant has provided the following process for manufacture of said product. The advance Ruling in this matter was pronounced on 02.01.2020 = 2020 (3) TMI 441 - AUTHORITY FOR ADVANCE RULING, MADHYA PRADESH. The order, however, suffers from certain errors, as pointed out by the applicant vide their application dated 28/29.01.2020 and dated 10.02.2020, that are apparent on the face of the records. They need to be rectified. The Authority therefore proceeds to examine the facts as pointed by the applicant 3. Brief Facts of the Case: 3.1 Soybean meal (raw material) with 12% moisture is conveyed to buffer tank after removal of metal impurities. All raw materials after measurement are sent into batch mixer for mixing, and then mix with liquid bacteria/Enzymes in the continuous mixer through a variable frequency screw conveyor which regulates its flow rate. Moisture content is adjusted to around 40% -50% in the continuous mixer. Finally Soybean meal after inoculation and mixing is delivered to fermentation section. 3.2 After Inoculation Soybean meal throu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturing process soya meal undergoes through fermentation process. (iii) The process uses biotechnology to convert protein structure to smaller molecular weight to increase efficiency digestion and absorption. (iv) It also breaks down and reduce antigens or anti-nutrient substance due to fermentation. (v) It is a high quality soya protein source of animal such as your animals in Aquatic feed including shrimp feed, poultry feed. Cattle feed & Pig feed. (vi) It focuses on the use of protein sources in animal feed by replacing fish meal, skim milk, milk replacer. (vii) Fermented soya protein can be use in the various kind of feeds, such as Poultry, Aqua, cattle, Pig feed etc. 3.8 The appellant has cited that Notification 02/2017-CT(Rate) dated 28.06.17 where it is mentioned that Aquatic feed including shrimp feed and prawn feed, poultry feed, cattle feed & Pig feed , including grass, hay & straw, supplement & husk of pulses, concentrates & additives, wheat bran & de-oiled cake (other than rice bran) falling under heading 2309 of GST Tariff attracts nil rate of GST. 3.9 The Appellant has also cited that explanatory Note to Heading 23.09 applies, mutalis mulandis, to this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - The following questions have been posted before the Authority: Whether the product "preparation of a kind used in Animal Feeding Bio Processed Meal" will fall under HS Code 23099090 and applicable rate of GST on said product shall be NIL as per Notification 02/2017 - CT (Rate) dated 28.06.2017? 5. Officer's View Point: The Superintendent (Tech.), CGST & Central Excise. Division Dewas vide his letter F.No. IV(16)100/Misc/Tech/CGST/17-18/Pt.II/1409 dated 07.11.2019, has forwarded department's view point in res he issue raised in the application. It is submitted in the report that the statement of relevant facts mentioned in the application by the party appears to be correct. 6. Record of Personal Hearing : Shri C L Dangi, Advocate and Shri Ravi Shankar Choudhary Advocate of the applicant. has appeared for Personal Hearing and reiterated the points mentioned in their written submission dated 26.07.2019, 14.10.2019 and 18.11.2019. 7. Discussion and finding portion in the order dated 02.01.2020 reads as under:- "7.1 We have carefully considered he submissions made by the applicant in the application, the pleadings on behalf of the Applicant made during the course of personal h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oducts for industrial use. The product meant for industrial use and far consumption of general public are leviable to various rates of GST whereas the applicant has claimed the chapter heading of 23099090 which is exclusively meant for animal feed attracts nil rate of duty. In such a situation a critical analysis is required to establish that the said product is meant only for animal feed 7.5 The applicant has claimed the classification under HSN code 23099090 which is exclusively meant for-animal feed and attracts nil rate of GST. The chapter note 2309 reads as under : "Note : heading 2309 includes product of a kind used in animal feeding, not elsewhere specified or included obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristic of the original material, other than vegetable waste, vegetable residues and by products of the such processing. Further the tariff heading 23099090 is detailed as under : 23.09 Preparations of a kind used in animal feeding, 2309.10 Dog or cat food, put up for retail sale 2309.90 Others 23099010 Compounded animal feed 23099020 Concentrates for compound animal feed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... responding notification issued under MPGST Act. We hold accordingly." 8. RULLING of earlier order dated 02.01.2020 "(Under Section 98 of Central Goods and Services Tar Act, 2017 and the Madhya Pradesh Goods and Services Tax Act, 2017) 1. The product "Preparation of a kind used in Animal Feeding - Bio Processed Meal" is not entitled to classify under HS code -23099090 and therefore not entitled for the benefit of Notification No.02/2017-CT(Rate) dated 28.06.17 and corresponding notification issued under MPGST Act. 2. This ruling is valid subject to the provisions under section 103(2) until and unless declared void under Section 104 (1) of the GST Act." 9. Submission of applicant under Section 102 of CGST Act, 2017 and Record of personal hearing dated 27.02.2020. The applicant submitted application dated 28/29.01.2020 & dated 10.02.2020 under Section 102 of CGST Act. 2017 pointing out the error apparent on face of the record for amendment of the order No. 01/2020 dated 02.01.2020 = 2020 (3) TMI 441 - AUTHORITY FOR ADVANCE RULING, MADHYA PRADESH. Shri Ravi Shankar Raichoudhary Advocate of the applicant, has appeared for Personal Hearing on 27.02.2020 and reiterated the points ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t it to remain on record - Section 254(2) of Income Tax Act, 1961. Rectification of mistake - Non-consideration of a decision of Jurisdictional Court or of the Supreme Court can be said to be a mistake "apparent from record" which could be rectified under Section 254(2) of Income Tax Act, 1961. 10.1 In terms of the Section 102 of CGST Act, 2017, the applicant requests authority of advance ruling to amend the order passed under Section 98 of the CGST Act, 2017 as following error are apparent in the order delivered by authority of advance ruling. (a) The authority has taken view that the applicant has replaced 52% in place of 50% and removed the part "and not fit for human consumption" in their additional submission on 18.11.19 from the line "The protein content of the feed grade is less than 50% and not fit for human consumption" as mentioned in 15(f) of original application. (b) In this regard the complete text of 15 (1) as mentioned in the original application is reproduced below: "Scientific base to prove the fact that the end product will he used only for PREPARATION OF A KIND USED IN ANIMAL FEEDING - BIOPROCESSED MEAL - The raw material for the preparation of Bio-Process ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng line of para 15(f) as mentioned above] is related to for the raw material to be used in the manufacture of finished products. The authority for advance ruling by mistake took this plea that the words 'the protein content of the feed grade is less than 52% 'were meant for finished products whereas a continuous reading of Para 15(f) "The raw material for the preparation of bio - processed meal is soya bean meal feed grade falling under HS code 23040030. The protein content of the feed grade is less than 50% and not fit for human consumption" clearly indicates that this part of the submission relates to raw materials and not for the finished products as observed by the authority of advance ruling. Thus, it is amply clear that on the face of the order error has been occurred and so for rectification of error Section 102 of CGST Act, 2017 is rightly applicable. (g) The authority of advance ruling also observed that there are no evidences in support of the applicant's claim that the said products under HS code 23099090 is far from the truth as the process of fermentation of the raw materials etc. for manufacturing of the product has been discussed in detail to prove the fact that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect address has been mentioned. Further it would be worth to mention that the new registration 23AABCV1297N3ZY obtained by the applicant for the new unit at Plot Number 112, Industrial Area No.1, Dewas (MP) 455001 on 30.03.2019 This unit is not engaged in manufacturing and export of various soya processed food, used for human as well as animal consumption as mentioned in para 1 of the order. (ii) The aforesaid apparent mistake has resulted to incorrect information regarding new unit of the applicant as mentioned in para 7.4 (discussion and finding portion) of the ruling referred above. The new unit of the applicant will only manufacture the finished product which will only be used for animal feeding and the same will not be used for any other purpose. The product viz. soya flakes / Grits, Soya Flour, Soya lecithin, Soya Protein / TVP, GMO Soyabean meal, non GMO Soya Grits etc. as mentioned in Para 7.4 of the order are manufactured by another unit of the applicant situated at 28, Industrial Area, A.B. Road, Dewas and having GST Number 23AABCV1297N2ZZ. (iii) The discussion and findings in para 7.4 of the ruling was relevant for the authority to take decision on the facts as menti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... processes like fermentation etc. will only be used for animal feeding and not for any other purpose. The manufacturing process also endorses that the finished product being manufactured from raw material having protein content the feed grade is less than 52% will only be used for animal feeding and not for any other purpose as declared by the Applicant. (b)The new unit is not engaged in manufacturing any product viz. soya flakes / Grits, Soya Flour, Soya lecithin, Soya Protein / TVP, GMO Soyabean meal, non GMO Soya Grits etc. as mentioned in para 7.4 of the earlier order dated 02.01.2020. (c) The various judgements quoted by the applicant i.e. in the case of National Plastic Industries Ltd. reported in 2018 (16) GST 287(A.A.R. - GST) = 2018 (8) TMI 1650 - APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA, in the case of Maheshwari Stones Supplying Company reported in 2018 (13) GSTL 345 (A.A.R. - GST) = 2018 (6) TMI 458 - AUTHORITY FOR ADVANCE RULING HYDERABAD TELANGANA, in the case of C.P.R. Mill reported in 2018 (17) GSTL 146 (A.A.R. - GST) = 2018 (9) TMI 1336 - AUTHORITY FOR ADVANCE RULING, TAMILNADU, in the case of SRIVET HATCHERIES reported in 2018 (19) G.S.T.L. 140 (A.A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch is specified in column (3) of the Schedule appended to the said notification, falling under the tariff item, subheading, heading or Chapter, as the case may be. as specified in the corresponding entry: Sl.No. Chapter heading/ sub-heading/ tariff item Description of goods 102. 2302, 2304, 2305, 2306, 2308, 2309 Aquatic feed including shrimp feed and prawn feed, poultry feed & cattle feed, including grass, hay & straw, supplement & husk of pulses, concentrates & additives, wheat bran & de-oiled cake 11.8 From above it is derived that the Chapter heading 23099090 is exclusively meant for animal feed. We find that the applicant has started their new unit at 112, Industrial Area No.1 Dewas for manufacture of the finished product "Preparation of a kind used in Animal Feeding - Bio Processed Meal" which will be used for animal feeding only. The applicant also submitted a detailed process as how the raw material soyabean meal will undergoes various processes in various section like inoculation and missing section, bio-processing section / fermentation section, drying section, milling and packaging section to achieve the goal of manufacturing the finished product. The applicant su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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