In re Dipakkumar Kantilal Chotai (Talod Gruh Udyog) (GST AAR Gujarat)
(1) Khaman mix flour, Gota mix flour, Handwa mix flour, Dahi wada mix flour, Dalwada mix flour, Meduvada mix flour, Pudla mix flour, Moong bhajiya mix flour, Chorafali mix flour, Bhajiya mix flour, Dhokla mix flour, Idli mix flour and Dosa mix flour are classifiable under subheading 11061000 of the First Schedule to the Customs Tariff Act, 1975(51 of 1975). They appear at Entry No.59 of Schedule-I of Notification No.01/2017-Central Tax (Rate) dated 28.06.2017 and the GST liability on all these products is 5%(2.5% CGST + 2.5% SGST).
(2) Upma mix flour, Rava idli mix flour and Muthiya mix flour are classifiable under sub-heading 23023000 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) whereas Khichu mix flour is classifiable under sub-heading 23024000 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). They appear at Entry No.103A of Schedule-I of Notification No.01/2017-Central Tax (Rate) dated 28.06.2017 and the GST liability on these products is 5%(2.5% CGST + 2.5% SGST).
(3) Chutney powder is classifiable under Sub-heading 21069099 of the First Schedule to the Customs Tariff Act, 1975(1 of 1975). The said product appeared at Entry No.23 of Schedule-III of Notification No.01/2017-Central Tax (Rate) dated 28.06.2017 till 14.11.2017 and at Entry No.100A of Schedule-I of the said notification with effect from 15.11.2017. The GST liability on the said product was 18%(9% CGST + 9% SGST) upto 14.11.2017 and 5%(2.5% CGST + 2.5% SGST)with effect from 15.11.2017.
(4) The supply of Gota Mix and Chutney powder will be considered as a ‘mixed supply’ of goods and will be considered as a supply of Gota Mix (falling under Sub-heading 11061000 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975)) on which the GST liability will be 5%(2.5% CGST + 2.5% SGST). The supply of Bhajiya Mix and Chutney powder will be considered as a ‘mixed supply’ of goods and will be considered as a supply of Bhajiya Mix (falling under Sub-heading 11061000 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975)) on which the GST liability will be 5%(2.5% CGST + 2.5% SGST).
Read AAAR Ruling : 18% GST leviable on Mix Flour of different food products
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, (Gujrat)
BRIEF FACTS
The applicant M/s. Dipakkumar Kantilal Chotai (Talod gruh Udyog) has submitted that theirs’ is a proprietorship firm and is one of the leading and highly reputed companies in the field of selling mixed flour which is used for preparing various Indian dishes; that applicant manufactures mixed flour which is used by customers for preparing different traditional Indian dishes such as Khaman, Gota, Dhokla, Handwa, Rice & Rava Idli Dhosa, Dahiwada, Dalwada, Menduwada, Bhajiya, Vada Masala, Khichu Upma, Muthiya Pudia, Gulab Jamun, Moong Bhajiya and Cholafali; that in a nutshell the said mixed flour is used for preparing instant farsan or eatable and a special mention can be made of Khaman, Gota and Handwa mix which has been accepted in the market as a product leader.
2. The applicant has stated that he is in the business of manufacturing and selling of varied types of mixed flour under the ‘Talod’ brand name that are used to prepare instant Farsan and other similar dishes; that ready to mix/instant mix is a flour of grains and pulses mixed with spices and condiments, that recipe for preparing farsan/eatables is printed on the packet of product and by following the direction of recipe, farsan/eatables can be prepared instantly after adding such other ingredients as required. The process followed by Talod can be understood as under:
(a) Talod purchases food grains and pulses from open market.
(b) Such pulses are sorted and washed and then send to grinding machine.
(c) Pulses are grinded into flour in grinding machine for e.g. where Grams is purchased it results into gram flour by following grinding process. Inc certain cases, Talod purchases grinded flour directly from the vendors.
(d) Now, certain spices are mixed in flour and such mixed flour is packed in various packings.
(e) Mixed flour (commercially known as ‘Instant Mix Flour’) are sold in open market or through distributors to consumers.
(f) End consumer of such instant mix flour is required to follow certain food preparation process before such product can be consumed as eaet able.
(g) Hence, instant mix flour cannot be consumed as it is, but it is required to follow certain cooking procedures before consumption. Hence the product manufactured and sold by the applicant is not ‘ready to eat’ but can be said as ‘ready to cook’.
3. The applicant has submitted an activity-wise manufacturing process flow chart for preparing final mixed flours in a diagrammatic manner and has explained the manufacturing process as under:
(a) Ready to mix/Instant mix flour contains mainly flours of grains and/or pulses like bengal gram dal, gram dal, udad dal, chana dal, Moong dal, Paddy, Sago, wheat granule, rice etc. where the content of ‘flour’ is having major weightage. Most of the mixed flour products have ‘flour’ content more than 70-90%.
(b) Powder of spices like pepper, red chilli, coriander, ajma, sounff, jeera, turmeric, tamarind, iodised salt, sugar, mustard, lemon, condiments, citric acid, sodium bicorbonate, turmeric, cumin, clove, curry leaves, adafoetida, baciliyam, black pepper, tej patta, curry leaves bundian, fennel seeds, anise seeds, bay leaf, neem leaves(sweet), flavours etc. are added in a very little quantity to make the product tasty and delicious.
(c) At the processing unit, the applicant is not carrying any process of cooking. The applicant carries on only mixing process, whereby spices, condiments and flavours are mixed with flour of grains, cereals and pulses. Flour of grains, cereals and pulses are used in its primary form.
(d) Instant mix/Ready to mix flour is packed in sealed packing of 50/90/200/250/500 grams and in 1 kgs. On packing material, preparation process/recipe is printed to prepare food from such instant mix.
(e) Instant mix/Ready mix flour is by all means not a processed food, neither cooked food, nor semi-processed food, nor semi cooked food, nor preserved food or not a ready-to-eat food. Instant mixed flour is a flour of grains and pulses mixed with spices, condiments and flavours.
4. The applicant has given the details of raw materials used in various products manufactured and flour of grains and pulses and other condiments contained in the products as follows:
