In re Chinnakani Arumuga Selvaraja, Proprietor of M/s Sri Venkateshwara Traders (GST AAR Tamilnadu)
The product ‘Cattle feed in cake form’ manufactured by the Applicant is classifiable under Chapter Heading 23099010 and stands exempted as per vide Sl.No. 102 of Notification No. 2/2017-Central Tax(Rate) dated 28th June 2017 as amended and Sl.No. 102 of Notification. No.II(2)/CTR/532(d-5)/2017 dated 29th June 2017 as amended and in case of interstate supplies vide Sl.No.102 of Notification No. 2/2017-Integrated Tax(Rate) dated 28th June 2017 as amended.”
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, TAMILNADU
Note : Any appeal against the advance ruling order shall be filed before the Tamil Nadu State Appellate Authority for Advance Ruling, Chennai under Sub-section (1) of Section 100 of CGST ACT/TNGST Act 2017 within 30 days from the date on which the ruling sought to be appealed against is communicated.
At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act.
M/s. Sree Venkateswara Traders (Prop: Chinnakani Arumuga selvaraja), No. 2/4, Sathanur Road, Vikravandi (West), Villupuram (hereinafter called as the ‘Company’ or ‘Applicant’) is engaged in the manufacture of “Cattle Feed in Cake Form”. The applicant was a registered dealer under the Tamil Nadu General Sales Tax Act, 1959 (TNGST Act) and under the Tamil Nadu Value Added Tax Act, 2006. They are registered under GST Act with GSTIN 33ASVPA4809N1ZC. The Applicant has sought Advance Ruling on the Classification of cattle feed in cake form
They have submitted the copy of application in Form GST ARA – 01 and also submitted a copy of Challan evidencing payment of application fees of Rs.5,000/-each under sub-rule (1) of Rule 104 of CGST rules 2017 and TNSGST Rules 2017.
2. The applicant has stated that they are effecting sales of cattle feed (cake form) both locally as well as by way of inter-state sale. The cattle feed is manufactured from the groundnut oil cake along with a list of ingredients including husked rice with broken rice, black 86 broken rice, jaggery, salt and water and after duly processing it is fit to be sold as “cattle feed”. Cattle feed being sold is meant for domestic animals as an essential raise for the maintenance of life and also as feed which is supplied over and above the maintenance requirements for growth or fattening and for production purposes such as re-production, for production of milk, meat and wool and in the case of animals, for efficient output of work also. They produced the certificates of analysts issued to one of the sister concern (M/s C.P.R Mill) of the product manufactured by them which is sold as “cattle feed” Cake Form, duly issued by the Department of Animal Institution, Veterinary College and Research Institute, Orathanadu, Thanjavur, both in respect of cattle feed Cake Form and groundnut oil cake. Additionally, a test report from the CSIR – Central Food Technological Research Institute, Mysore procured by the sister concern was also submitted. They have further stated that they are manufacturing the ” cattle feed” in cake form in the same mill as of the sister concern on shift basis. The applicant has made reference to the proceedings of the Authority for Advance ruling under GST, Tamil Nadu passed in the case of their sister concern M/s C.P.R Mill in Order No. 8/AAR/2018
2.2 They have also stated that right from the inception under the sales tax enactment, cattle feed in cake form manufactured by them were eligible for exemption under the TNGST Act 1959 , under the TNVAT Act 2006. They submit that since the product manufactured by them could be used only as cattle feed meant for animals there cannot be any liability by way of tax under GST Act. In view of the above facts the applicant requested to issue an Advance ruling with regard to the classification of their product “Cattle feed in cake form”.
3. The Authorized Representative of the Applicant was heard in the matter on 23.07.2019. They submitted a written submission, a CD with videos of manufacturing. They stated that they are sister concern of M/s C.P.R Mill , Shri Aadhi Trading Company and use same labor and machinery. They use groundnut oil cake, broken rice, rice husk, jaggery, salt, water to make cattle feed. They submitted a written submission . They informed that they will submit copies of sale invoices, photos of sale products including packaging and write up on manufacturing process.
3.1 Further, to the Personal Hearing held on 23.07.2019 the applicant submitted the written submission, manufacturing process flow chart and copies of sale invoices.
4. The jurisdictional authority- Assistant Commissioner (ST), Villupuram- I in their comments have stated that though cattle feed in cake form processed out of Groundnut oil cake is entirely different from Groundnut oil cake, it will not lose its nature, character, identity and no new product emerged; the small size Groundnut oil cake was made as big one; However, the item of Groundnut oil cake is one of the major ingredient of Groundnut cake for cattle feed which is not specifically found as one of the supplement in exempted entry No.5 Part B fourth schedule of TN GST Act 2017, whereas in Sl.No 106.(Tariff item 2305) oil cake and other solid residues whether or not ground or in the form or pellets resulting from the extraction of Groundnut oil is liable to tax at 2.5% . But the said entry continue as (other than aquatic feed including shrimp feed and prawn feed poultry feed and cattle feed). As per the contents of the applicant the ingredients of cattle feed Groundnut cake are Groundnut of cake husked rice, with broken rice, black and broken rice, jaggery, salt and water. The major portion of the ingredients is Groundnut oil cake and more ever it is not known that such product is only for the purpose of usage as cattle feed, also when the Groundnut oil cake is liable to tax and the buyer of such goods is also eligible to claim Input Tax Credit then there is no reason to allow exemption on the corresponding sales which after some process sold as cattle feed. As per Schedule I of TNGST Act 2017, entry 14- Tariff item 0410 Edible products of animal origin not elsewhere specified or included is liable to tax at 2.5%. The Product of the applicant should be classified under the above category, this entry was not provided under the TNGST Act 1956 and TNVAT Act 2006. Hence, the product of the applicant is liable to tax at 2.5% whatever the name it is called be.
4. We have carefully examined the details and documents furnished. From the various submissions of the applicant, it is seen that the product under consideration, ‘Cattle Feed in Cake Form’ is manufactured by pulverizing Groundnut oil cake, husked rice with broken and black broken rice pulverized separately, which are spread over and then jaggery, salt & water are added, mixed, thoroughly crushed and left for condensing itself into solid form and steamed to result in ‘Cattle feed in Cake Form’. The breakup of the ingredients for manufacturing cattle feed (in cake form) per 100 Kgs as given by the applicant is as follows:
