In re Perumal Vasudevan (M/s V.S. Trading Company) (GST AAR Tamil Nadu)
The case of In re Perumal Vasudevan (GST AAR Tamilnadu) concerns V.S. Trading Company, a dealer engaged in the trading of ‘Tapioca Flour’ (locally known as Thippi or Kappi), seeking clarification on the correct classification, applicable tax rate, and registration liability under the Goods and Services Tax (GST) framework.
The central dispute revolved around whether the product should be classified as Flour of Manioca/Cassava under HSN 1106, which attracts a Nil rate of tax (if unbranded/unpacked), or as Residues of starch manufacture and similar residues under HSN 2303, which attracts a 5% GST rate.
Initial Proceedings and Remand
V.S. Trading Company, which procures and sells the product using Bill of Supply under HSN 1106, initially sought an Advance Ruling. The Authority for Advance Ruling (AAR) first issued an order (No. 25/AAR/2023 dated 20-06-2023) classifying the product under HSN 2303 1000 as ‘Residues of starch manufacture’ liable to 5% GST. Furthermore, the AAR ruled that the exemption notification cited by the applicant was inapplicable and the company was liable for GST registration under Section 22.
Aggrieved by this initial decision, the applicant filed an appeal before the Appellate Authority for Advance Ruling (AAAR). The AAAR, citing issues with the principles of natural justice and insufficient clarity on the manufacturing process, remanded the case back to the AAR for fresh consideration in June 2025. The final order was a result of this fresh consideration and subsequent submissions by the applicant, including certified details of the manufacturing process.
