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TMI Blog2021 (10) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... . The appellant raised the following questions for advance ruling in the application for Advance Ruling filed by it before the Gujarat Authority for Advance Ruling (herein after referred to as the 'GAAR'). 1. Under which tariff Heading the product dealt in by the applicant i.e. PAPAD of different shapes and sizes are eligible to be classified 2. What is the applicable rate of CGST and SGST on supply of such papad of different shapes and sizes. 4. The appellant has submitted that they are engaged in the business of manufacturing and trading of "Papad" of different shapes and sizes. Papad is crunchy snack that is conceptualized as a product that is raw pallet yet semi-cooked / un-cooked and needs to be cooked first either by frying or roasting before consuming as and when required. 5. The appellant has submitted that Papad turns out to be a papad when the dough is moulded and given the shape, usually a palm size round or may be smaller or bigger. The dough remains the same with minor variations in proportions of ingredient and the dough is moulded in the desired shapes and size may be round, may be square, may be semi-circle, may be hollow circle with bars in between or may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of this heading and covers preparations for use either directly or after processing, for human consumption. Chapter Note 6 pertaining to Tariff Item 2106 90 99 also provides inclusive definition and products mentioned therein are illustrative only. In view of the foregoing, the GAAR ruled as follows :- 1. Under which tariff Heading the product dealt in by the applicant i.e. PAPAD of different shapes and sizes are eligible to be classified? Ans. The product of different shape and sizes manufactured and supplied by applicant is "un-fried Fryums" and not "Papad" and is classifiable under Tariff item 21069099 of the First Schedule to the Customs Tariff Act, 1975. 2. What is the applicable rate of CGST and SGST on supply of such papad of different shapes and sizes. Ans: Goods and Services Tax rate of 18% (CGST 9% + GGST 9% or IGST 18%) is applicable to the product 'Un-fried Fryums' as per Sl. No. 23 of Schedule III of Notification No. 1/2017-Central Tax (Rate), dated 28-62017, as amended, issued under the CGST Act, 2017 and Notification No. 1/2017-State Tax (Rate), dated 30-6-2017, as amended, issued under the GGST Act, 2017 or IGST Act, 2017. 7. After issuance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the DGGI, Surat Zonal Unit in search proceeding dated 17.02.2020, to which the appellant answered that (i) the application for advance ruling was ready and soon the search took place, so it was filed belatedly be few days, without any ulterior motive or mala-fide intention; and that (ii) for bona-fide dispute with regard to classification for supply of goods and its rate of tax, the inference drawn through the search proceedings vide section 67 of the CGST Act, 2017 is untenable. 10.2 The appellant has submitted that it appears that both these particulars have not been recorded either in the proceeding sheet or in the body of the order, possibly keeping in mind that the third proviso warrants it only in case if the given reason is rejected. It has been submitted that the legality and propriety of the order in terms of section 98(2) of the CGST Act, 2017 has been thought to be examined and again the decision to be taken whether the said order is maintainable in the eye of law or void ab initio and deserves to be set aside. 10.3 The appellant has submitted that for the term 'proceedings' and related proviso, the law makers have considered Chapters III, IV and V; that to be pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... act on such confessions. It has been further submitted that the year is over, the DGGI has not called the appellant for further proceeding. 10.7 The appellant has submitted that this authority has been conferred with discretionary power to either allow or reject the application on the ground no other than those prescribed by the proviso to sub-section (2) of Section 98 of the CGST Act, 2017. FINDINGS :- 11. We have carefully gone through and considered the appeal and written submissions filed by the appellant, the Advance Ruling given by the GAAR and other material available on record. 12. We observe that as provided under the first proviso to sub-section (2) of section 98 of the CGST Act, 2017 and the GGST Act, 2017, the application for advance ruling cannot be admitted where the question raised in the application is already pending or decided in any proceedings in the case of an applicant under any of the provisions of the said Acts. The said provisions are reproduced here under : 98. Procedure on receipt of application.- (1) On receipt of an application, the Authority shall cause a copy thereof to be forwarded to the concerned officer and, if necessary, call upon him to fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ormed the Advance Ruling Authority that their representative during the personal hearing had mentioned the fact but the Advance Ruling Authority has not mentioned the said fact in the Advance Ruling pronounced vide Order No. GUJ/GAAR/R/77/2020 dated 17.09.2020. In this regard, the record of personal hearing has been perused and it is observed that the virtual Personal hearing (through video conferencing) was conducted and recorded as "During the personal hearing conducted through video conferencing, the representative of the applicant reiterated the submission given by the applicant." This shows that during the personal hearing, representative of appellant have not informed anything about the proceedings of DGGI, Surat. 16. The issue in the present case is not whether the application for advance ruling was ready or otherwise when the proceedings against the appellant were initiated by the DGGI, Surat and whether there was any ulterior motive or mala-fide intention in belatedly filing of such application before the GAAR. It is undisputed fact that the DGGI, Surat conducted search proceeding on 17.02.2020 and recorded a statement of the partner of the appellant on the very same issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation. 20. Thus, it is evident that the appellant has not informed the aforesaid material facts to the GAAR at any given point of time thereby willfully suppressing the fact from the Authority and obtaining the Ruling by suppressing the facts. Section 104 of the CGST Act, 2017 stipulates that any Ruling obtained by the applicant under Section 98(4) of the CGST Act, 2017 by "fraud or suppression of material facts or misrepresentation of facts" may be declared void ab-initio. Section 104 of CGST Act, 2017 has been reproduced below for ready reference. 104. Advance ruling to be void in certain circumstances.- (1) Where the Authority or the Appellate Authority finds that advance ruling pronounced by it under sub-section (4) of section 98 or under sub-section (1) of section 101 has been obtained by the applicant or the appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab-initio and thereupon all the provisions of this Act or the rules made there under shall apply to the applicant or the appellant as if such advance ruling had never been made: Provided that no order shall be passed under this sub-sect ..... 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