In re ROS products (GST AAR Kerala)
The Goods and Services Tax (GST) Authority for Advance Rulings (AAR) in Kerala has clarified the HSN (Harmonised System of Nomenclature) code and applicable GST rate for Icing Sugar in response to an application by M/s ROS Products, a food products business. The applicant sought a definitive ruling as Icing Sugar was being sold under two different HSN codes (1701 at 5% GST and 1702 at 18% GST), creating uncertainty.
The applicant contended that Icing Sugar is manufactured by pulverizing refined sugar (HSN 1701) with a small percentage (not more than 4% by weight on a dry basis) of maize starch (HSN 1108), as per FSSAI regulations. The AAR, after detailed examination and reviewing relevant GST notifications and Customs Tariff schedules, noted that while no specific heading exists for “Icing Sugar,” the product is essentially finely ground sugar. The AAR considered that Icing Sugar, primarily composed of refined sucrose with a small quantity of starch as an anti-caking agent, retains the essential character of sugar. Applying Rule 3(a) of the Customs Tariff Act’s interpretation principles, which prioritizes the most specific description, the AAR concluded that Icing Sugar derived from refined sucrose should be classified under the HSN code of its primary component.
