In re Gitwako Farms (India) Pvt. Ltd. (GST AAR Haryana)
Question Raised- Meat of Sheep or goat, frozen and packed in LDPE/HDPE bags having varied weight and quantity printed/labelled on such pickings, whether could be held to be packed in unit containers ?
Held by GST AAR Haryana
(a) The whole (sheep/goat) animal carcass in frozen state in different weight and size packed in LDPE bags without mentioning the weight and one or two such LDPE bags further packed in HDPE bags having mention of varying actual total weight of the carcasses packed in each such HDPE bags and supplied to Army shall not qualify as product put up in ‘Unit Container’.
(b) The product as mentioned at (a) above fall under exemption list as per entry no. 10 of notification No. 2/2017-Integrated tax (Rate) dated 28th June 2017 upto 14th November 2017 and thereafter as per entry No. 9 of notification no. 44/2017 – Integrated Tax (rate) dated 14th November 2017.
FULL TEXT OF ADVANCE RULING
Factual Background
M/s Gitwako Farms (India) Pvt. Ltd supplies to Army and Para Military Forces sheep/goat meat in carcasses of different weight and size in frozen State. Each frozen carcass is put in LDPE bag (primary packing) which is sealed with a tie and no weight is mentioned on such LDPE bags. Thereafter, one or two of such LDPE bags are put in dust and moisture proof food grade HDPE bags (secondary packing). On such HDPE bags, contents including product name, firms name and brand, net weight, batch no., lot no., and instructions for consumption and preservation of such meat is printed.
The frozen meat as packed above is then deliver in temperature controlled refrigerated vans with data-logger installed for continues monitoring.
In the above backdrop of facts, the applicant has submitted the application for advance ruling on the following:-
1. What is the classification when frozen meat is sold in packaged form and its HSN code.
2. What is the rate of tax on frozen meat sold by the company.
Comment of the Officer under section 98 (1) of the CGST, HGST Act 2017
The Deputy Excise & Taxation Commissioner (ST), Nuh (Mewat) vide his letter no. 80/STA, dated 21.05.2018 as stated that the applicant dealer supplies frozen meat backed in PDPE bags in the shape of unit container. Since the applicant is supplying his goods packed in bags hence it qualifies as supply of goods in unit container and 12% GST is applicable.
Record of Personal Hearing
The applicant was afforded a personal hearing for 24.05.2018. The issue raised by the applicant for advance ruling, whether their product can be said to be packed in a unit container to fall under the scope of notification no. 1/2017-Central Tax (Rate) and 1/2017- Integrated Tax (Rate) dated 28.06.2017 or notification no. 2/2017 -Central Tax (Rate) dated 28.06.2017. is covered under the scope of section 97 of CGST/HGST Act 2017 and therefore, the application was admitted.
As regard the classification of their product, the departmental representative had stated that the applicant firm is packing the animal carcasses in bags for supplying to their customers, i.e. Army, in unit containers and therefore it attracts GST @ 12%.
The applicant had strongly argued that the packing done by them cannot be said to be unit containers as it is defined in the explanation to mean a package designed to hold a pre-determined quantity or number which is indicated on such package. The applicant had cited several case laws where the definition of unit container had been discussed and adjudicated.
After hearing and discussion in detail, the decision on the question sought to be answered was reserved which is being released today.
Discussion and finding of the authority
GST is chargeable as reference to value and at applicable rates. For the purpose of building a point of view reference is made to the IGST rate schedule.
W.e.f. from 1st July, 2017 till 14th November, 2017
Schedule II of the Notification No. 1/2017- Integrated Tax (Rate) dated 28.06.2017 deals with the products which are subject to 12 % GST and entry No. 4 which pertain to sheep meat is provided below:-
Schedule-II
