5% GST payable on Puri Papad and Unfried Papad: AAR [Read Order]

The Gujarat Authority of Advance Ruling (AAR) ruled that 5% GST payable on Puri papad and Unfried papad.

The applicant, M/s. Global Gruh Udyog submitted that they are planning to manufacture: PuriPapad and unfried papad (not served for consumption) such as Jeera papad, Red Chili papad, Green chilli papad, Rice papad, Pauapapad, Udadpapad, Mung papad and Black pepper papad, all produced by using the same machinery.

The applicant has further submitted that on the basis of production process, raw material used, HSN analysis, trade parlance etc., they contend that their product Papad is an Indian food prepared mainly with the ingredients like flour, spices, salt, oil etc. This product is unfried and it is not a cooked food. Further it is not an instant food eatable for human consumption. Consumers need to fry or roast the product to make it ready for consumption. As per rules of interpretation for classification of goods under HSN, specific heading will prevail over general heading. The titles of Sections, Chapters and sub-chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes.

The applicant has sought the advance ruling in respect of the classification of the goods intended to be produced such as Puripapad and Unfried papad.

The coram of Members Sanjay Saxena and Arun Richard while ruling that the ​​Goods are classified at HSN 19059040 ruled that due to advancement of technology, papad does not limit to the same age old traditional round shaped papad but can be in any desired shape and size. In the old era, usually ‘papad’ was manufactured manually, therefore it was easy for them to manufacture the Round Shape papad. In the modern era, by the advent of technology, the product is being manufactured by machines and dies of different shapes and sizes are used in the machine. Therefore, with the help of dies of various sizes and shapes, it is convenient to manufacture different shapes and sizes of papad. Further, at entry No. 96 of Notification No. 02/2017-CT (Rate) dated June 28, 17, the description goods is Papad, by whatever name it is known, except when served for consumption.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan AdFree. Follow us on Telegram for quick updates.