9911796707
TMI Blog2025 (5) TMI 982X X X X Extracts X X X X X X X X Extracts X X X X ..... 27, Rajasthan (hereinafter "the applicant") is fit to pronounce advance ruling as they have deposited prescribed Fee under CGST Act and it falls under the ambit of the Section 97 (2) given as under: (a) classification of goods and/or services or both A. SUBMISSION OF THE APPLICANT (in brief) :- Brief facts of the case: * The applicant states that he is intending to start the business of trading-purchase and sale of Ground Nuts with shell. The applicant will purchase/source ground nuts from farmers (mandi) and then sell/supply it on order to various firm inter-state and intra-state. * Ground nut is the 'King of Oil seeds' because of its high nutritional values containing proteins, oil, carbohydrate and calorific value. It is grown in Kharif and Rabi seasons of India and India is the second largest Ground Nut producing country followed by China. * Moisture content is a fundamental characteristic of Ground Nut. There are strict moisture content requirements for Ground Nut production. For harvesting, processing, or storage, the moisture content of Ground Nut must be within a particular range. Ground Nuts are susceptible to mold growth, particularly Aspergillus flavus and Aspe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be consumed directly at the source itself, there is no need of such practice by the applicant, it is only to increase the duration for which the Ground Nuts can be conserved in their original form so that they can be transported from their source to the destination. * The distinguishing element between drying with heat and roasting or cooking can also be understood as, the process of drying involves heat treatment ranging from 10-90 degrees Celsius while the process of roasting or cooking involves use of excess or very high heat treatment ranging much above 100 degrees Celsius that produces fundamental chemical and physical changes in the structure and composition of the goods, bringing about a slightly charred (darkened) physical appearance. Therefore, drying is a moisture removal process involving methods such as dehydration, evaporation, etc., whereas roasting is a severe heat treatment process. * That the present Application for Advance Ruling is preferred inter-alia on following grounds: GROUNDS: A. Because Ground Nuts falls under chapter 12 of the Goods and Services Tax Act, 2017 at Tariff Heading1202 as: "1202 - Ground Nuts, Not Roasted or Otherwise Cooked, Whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mild heat treatment 2. The issue wise clarifications are discussed below : 3. Classification of leguminous vegetables when subject to mild heat treatment (parching) : 3.1 Doubts have been raised whether mild heat treatment of leguminous vegetables (such as gram) would lead to change in classification. 3.2 Dried leguminous vegetables are classified under HS Code 0713. As per the explanatory memorandum to the HS 2017, the Heading 0713 covers leguminous vegetables of Heading 0708 which have been dried, and shelled, of a kind used for human or animal consumption (e.g., peas, chickpeas etc.). They may have undergone moderate heat treatment designed mainly to ensure better preservation by inactivating the enzymes (the peroxidases in particular) and eliminating part of the moisture. 3.3 Thus, it is clarified that such leguminous vegetables which are subjected to mere heat treatment for removing moisture, or for softening and puffing or removing the skin, and not subjecting to any other processing or addition of any other ingredients such as salt and oil, would be classified under HS Code 0713. Such goods if branded and packed in a unit container would attract GST at the rate of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f nuts in respect of tannin and arecoline content - Ash-like substance is deposited on outer surface of betel nut - Visual comparison indicates that roasted supari is dark grey in colour while normal supari is brown in colour - HELD: Explanatory note to Heading 0802 of Customs Tariff Act, 1975 is satisfied as main uses of nuts is masticatory - Processes mentioned in Chapter 8ibid do not cover roasting, which is different from moderate heat treatment as well as dehydration - Hence, roasted betel nuts do not satisfy Note 3 to Chapter 8 ibid and is not classifiable under chapter 8 of Tariff - Roasting of betel nut constitutes 'preparation' - Roasted betel nuts are classifiable under Heading No. 2008 ibid, more specifically under Sub-heading 2008 19 20, as they are specifically mentioned in this heading and they are not excluded by any chapter note or explanatory note from CTH Heading No. 2008 - As goods are already included in Heading No. 2008, they are excluded from Chapter 21. [paras 4.3, 4.4, 4.8, 4.9, 4.11, 4.12, 4.18, 4.19 and 5] Words and phrases - Drying and roasting - These terms have to be understood in commonly accepted sense as they are not defined in Customs Tariff Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ws :- " It is therefore, prayed that in light of the above made submission, the commodity to be traded by the applicant i.e. groundnut with shell (procurement from farms and supply after dehydration by mild heating), to be held as goods falling under chapter heading 12, tariff item 1202 attracting NIL rate of GST. Thus, from the applicable tax-rate point of view, it appears that the applicant made contradictory statements in the application. 3. As per application, the taxable person wants to reduce water content by mild heating process. Here it appears necessary to understand some terms like drying, heating, roasting and cooking. Normally drying appears to be sun-drying or air-drying in Agri-sector. Sun-drying and Air-drying is a natural process. Drying also carried out artificially or mechanically using heat treatment which can be termed as heating. Heating holds close proximity with roasting. Mild heating or roasting have a mild difference based on degree of heat or temperature. Heat-drying or heating can also bring change in physical appearance, structure and composition to subjected goods. Further, cooking is a more intense form of the same. Thus, drying, heating, roasting an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elated to mild heating are drying, heating, roasting and cooking. Normally drying relates to be sun- drying or air-drying in Agri-sector. Sun-drying and Air-drying is a natural process. Drying also carried out artificially or mechanically using heat treatment which can be termed as heating. Mild heating or roasting has a minor difference based on intensity of heat. Thus, drying, heating, roasting and cooking are gradually more intense than former. 6) We observe that heating holds close proximity with roasting. Further, we find that the applicant has not mentioned the details of the heating process to be adopted by him. He has not mentioned details of equipments etc. that will be used to heat ground nuts in order to remove moisture in a controlled way by maintaining adequate temperature. We also find that the applicant has not submitted any details of the infrastructure set up or intended to be set up by him in this regard. Heating at sufficient degree becomes roasting and roasted groundnuts is not classified under HSN - 1202 by legislature. Further, it is noteworthy that heat-drying or heating can also bring change in physical appearance, structure and composition to subjected goo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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