Flavoured milk classifiable under 0402 is subjected to 5% GST: Karnataka HC

Dodla Dairy Limited Vs Union of India (Karnataka High Court)

Karnataka High Court held that flavoured milk should be classified under Tariff Heading 0402 of the Customs Tariff Act and hence be subjected to GST @5% [i.e. CGST 2.5% and SGST 2.5%]. Accordingly, the present writ is allowed.

Facts- The petitioner is a registered dealer, under the GST Act, dealing with milk and milk products. The assessment of the petitioner, for the period 2017-18, was completed and an assessment order has been passed by the 2nd respondent, on 09.03.2021. The petitioner was aggrieved by two components of the assessment order. The Assessing Officer had held that the flavoured milk sold by the petitioner would fall within the tariff heading CH 2202 instead of 0402. The Assessing Officer had also held that the conversion of milk into milk powder and the charges collected on such conversion was chargeable at the rate of 18%.

The petitioner being aggrieved by the two components of the assessment order had filed an appeal before the 1^st respondent which came to be dismissed on 16.12.2024. Aggrieved by these two orders, the petitioner has approached Court, by way of the present Writ Petition.

Conclusion- The Madras High Court in the case PARLE AGRO PVT. LTD. VS. UNION OF INDIA has held that Flavoured milk’ should be classified under Tariff Heading 0402 of Customs Tariff Act, 1975, and is, hence, subject to Central Tax at 2.5% as per Sl. No. 8 in First Schedule to Notification No. 1/2017-C.T. (Rate), dated 28-6­2017 Section 9 of Central Goods and Services Tax Act, 2017-Section 9 of Tamil Nadu GST Council’s recommendation was incorrect Goods and Services Tax Act, 2017.