In re P. S. K. Traders (GST AAR Tamilnadu)
In a proceeding before the Tamil Nadu Authority for Advance Ruling (AAR), M/s. P.S.K. Traders, a business dealing in Palmyra Jaggery and Palmyra Sugar, requested a ruling on a tax dispute. The company’s premises had been inspected by tax officials who issued a notice (Form GST DRC-01A) demanding a higher tax rate of 18% on Palmyra Sugar for the financial years 2018-19 to 2023-24. The officials’ notice cited a tax difference of 12% (18% minus 5%), along with interest and a penalty. P.S.K. Traders contested this, arguing that their product should be taxed at the lower 5% rate as a type of jaggery.
The company based its argument on specific legal provisions and judicial precedents. They referenced Notification No. 2/2017 – Central Tax (Rate) and Notification No. 6/2022-Central Tax (Rate), which address the tax rates for various types of jaggery, including Palmyra Jaggery. They also cited three key legal precedents to support their position: Commissioner of Central Excise vs. Amrit Food (Supreme Court of India), M/s. Parle Agro Pvt. Ltd. vs. Union of India (Madras High Court), and M/s. Prakash & Co. (AAR Karnataka). These cases were presented to demonstrate that the classification and tax treatment of their product were consistent with established legal interpretations.
