The Gujarat Authority of Advance Ruling (AAR) ruled that the product Rice Bran(22+oil) shall be classified under Chapter heading 38259000 and attracts rate 9% of Central Goods and Service Tax (CGST)and 9% State Goods and Service Tax (SGST) i.e. a total of 18% GST under vide Sr. no. 98 of Schedule III of notification no.1/2017-Central Tax (Rate) of CGST Act and corresponding notification of SGST Act.
Applicant M/s. Pratham Agro Vet Industries is registered under Central Goods and Services Tax Act, 2017, and Gujarat Goods and Services Tax Act, 2017 and is engaged in the manufacturing of Rice Bran by processing Rice husk of Poha and Mamra with different kinds of sludge/wax oil. As a result of the manufacturing process, the product namely Rice Bran (22+oil) and Non-Edible C grade oil are produced. The applicant purchases rice husk of Poha and Mamra with approximately 5% oil content. The applicant further purchases different kinds of sludge/wax oil, the residue generated in the refining of the oil.
The applicant by doing the process on the goods manufactures Rice Bran and Non-Edible C grade Oil. During the course of the manufacturing process, the oil content of Rice Husk of Poha and Mamra increases from 5% to 22% or more. It is because, during the course of the manufacturing process, the oil content present in the sludge/wax oil gets transferred in the final product. The applicant is selling Rice Husk of Poha and Mamra containing a higher percentage of oil as Rice Bran (22+oil) and the product oil as non Edible C grade oil. The Rice Bran is used in the manufacturing of Oil-based Soap.
The applicant prays before the Authority for Advance Ruling to decide under which tariff heading the disputed product Rice Bran (22+0i1) is covered and the rate of tax applicable on supply under the CGST Act and SGST Act.
The Authority consisting of members Sanjay Saxena and Mohit Agarwal the product Rice Bran (22+oil) shall be classified under Chapter heading 38259000 and attracts rate 9% of Central Goods and Service Tax (CGST)and 9% State Goods and Service Tax (SGST) under vide Sr. no. 98 of Schedule III of notification no.1/2017-Central Tax (Rate) of CGST Act and corresponding notification of SGST Act.
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