The Gujarat Authority of Advance ruling (AAR) ruled that J.J.’s Popcorn is manufactured from raw corn/maize grains, which, by heating turn into puffed corns/popcorns and then to make it palatable other ingredients like salt and turmeric powder along with oil are added to it fits the description as ‘Prepared foods obtained by the roasting of cereal’, which attracts 9% CGST and 9% SGST or 18% IGST.
The applicant, M/s. Jay Jalaram Enterprises are a proprietorship concern and manufacture Pop Corn, which is sold in a sealed plastic bag bearing a registered brand name as [J.J.’s] Popcorn, under the Trade Marks Act, 1999.
They submitted that their product is manufactured by using corn/maize grains. The Raw corn grains are heated in an electric machine/oven and due to the heat so given to the grains, they turn into puffed corn/popcorns which are known in the Gujarati language as “Dhani” which is similar to that of puffed rice/ known as murmura.
Then after they are sieved so as to remove some grains which are left un- puffed. During the process Salt, Edible Oil, and Turmeric Powder are mixed in the required quantity. Thereafter, the product is packed in a plastic pouch in a quantity of 15 gm.
The applicant sought the advance ruling on the issue relating to the classification, under which Schedule/Sr. No./Chapter heading/Sub-heading/tariff Item (HSN) the rate of CGST/SGST would be applicable to the supply made by the applicant on [J.J.’s] Popcorn.
The Authority consisting of Sanjay Saxena and Mohit Agarwal ruled that J.J.’s Popcorn is manufactured from raw corn/maize grains, which, by heating turn into puffed corns/popcorns and then to make it palatable other ingredients like salt and turmeric powder along with oil are added to it fits the description as ‘Prepared foods obtained by the roasting of cereal’. This description attracts classification under Chapter Sub-Heading 1904 10 of the First Schedule to the Customs Tariff Act, 1975. Since it is not Corn flakes (tariff item 1904 10 10), Paws, Mudi and the like (tariff item 1904 10 20) or Bulgur wheat (tariff item 1904 10 30), it will fall under the residual tariff item 1904 10 90 of the First Schedule to the Customs Tariff Act, 1975. By virtue of this, the said product falls under entry at Sr. No. 15 of Schedule III of Notification No.1/2017 CENTRAL TAX (Rate) Dated 28-6-2017 and attracts 9% CGST and 9% SGST or 18% IGST.
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