New Delhi, Gujarat Appellate Authority for Advanced Ruling (GAAAR) has ruled that instant mixes including idli, dosa and khaman atta cannot be classified as chatua or sattu and should attract 18 per cent GST.
Gujarat-based Kitchen Express Overseas Ltd had approached AAAR against the GST advance authority's decision, saying that seven of its 'instant flour mixes' are not 'ready to eat' but they undergo certain cooking processes. and they can be called 'ready'. cooking'.
The company sells a mixture of flour for Gota, Khaman, Dalwada, Dahi-Vada, Dhokla, Idli and Dosa in powder form and has argued that it is similar to Sattu and attracts 5 percent Goods and Services Tax (GST). Needed
GAAR rejected the contention of the Appellant, saying that the ingredients which are used in making 'instant flour mix' are not covered under the relevant GST rules as is the case with Sattu.According to a CBIC circular, small quantities of ingredients that are mixed to make sattu are specified in the GST rules to be eligible for 5 per cent tax rate.
"However, the said clarification is not applicable in the present case as the products being supplied by the Appellant include spices and other ingredients, which is not the case with 'Chhatua or Sattu'," the GAAR said.
The appellate authority also said that merely because the end consumer of instant mix flour is required to follow certain food preparation processes before consuming such products, is no ground why 18 per cent GST should not be imposed on it.
Abhishek Jain, head of indirect tax and partner at KPMG, said classification disputes are one of the most common areas of litigation under GST.
Jain said, “Despite the circulars being issued, differing interpretations of the clarifications given in these circulars have often given rise to challenges.,
Rajat Mohan, executive director of Moore Singhi, said that the Gujarat Appellate Authority for Advance Ruling (AAAR) has confirmed the decision of the Authority for Advance Ruling (AAR) which has banned various 'Kitchen Express' brands of flour, including Khaman and Dhokla, under the Chapter Title ( CH) is classified under 2106. 9099, due to which 18 percent GST rate will be applicable on them.
Mohan said, "This determination was based on the significant inclusion of additives like sugar, salt and spices in the products, which differentiates them from simple flour classified under Chapter 1101, 1102, or 1106, which attracts 5 percent GST rate " ,
Mohan said, the AAAR clarified that CH 2106 90 99 covers 'ready to cook' food preparations and rejected the Appellant's comparison with 'Sattu', stating that the Appellant's products do not contain additives. The substantial presence of justifies the higher tax rate.
Gujarat-based Kitchen Express Overseas Ltd had approached AAAR against the GST advance authority's decision, saying that seven of its 'instant flour mixes' are not 'ready to eat' but they undergo certain cooking processes. and they can be called 'ready'. cooking'.
The company sells a mixture of flour for Gota, Khaman, Dalwada, Dahi-Vada, Dhokla, Idli and Dosa in powder form and has argued that it is similar to Sattu and attracts 5 percent Goods and Services Tax (GST). Needed
GAAR rejected the contention of the Appellant, saying that the ingredients which are used in making 'instant flour mix' are not covered under the relevant GST rules as is the case with Sattu.According to a CBIC circular, small quantities of ingredients that are mixed to make sattu are specified in the GST rules to be eligible for 5 per cent tax rate.
"However, the said clarification is not applicable in the present case as the products being supplied by the Appellant include spices and other ingredients, which is not the case with 'Chhatua or Sattu'," the GAAR said.
The appellate authority also said that merely because the end consumer of instant mix flour is required to follow certain food preparation processes before consuming such products, is no ground why 18 per cent GST should not be imposed on it.
Abhishek Jain, head of indirect tax and partner at KPMG, said classification disputes are one of the most common areas of litigation under GST.
Jain said, “Despite the circulars being issued, differing interpretations of the clarifications given in these circulars have often given rise to challenges.,
Rajat Mohan, executive director of Moore Singhi, said that the Gujarat Appellate Authority for Advance Ruling (AAAR) has confirmed the decision of the Authority for Advance Ruling (AAR) which has banned various 'Kitchen Express' brands of flour, including Khaman and Dhokla, under the Chapter Title ( CH) is classified under 2106. 9099, due to which 18 percent GST rate will be applicable on them.
Mohan said, "This determination was based on the significant inclusion of additives like sugar, salt and spices in the products, which differentiates them from simple flour classified under Chapter 1101, 1102, or 1106, which attracts 5 percent GST rate " ,
Mohan said, the AAAR clarified that CH 2106 90 99 covers 'ready to cook' food preparations and rejected the Appellant's comparison with 'Sattu', stating that the Appellant's products do not contain additives. The substantial presence of justifies the higher tax rate.
