Chocolate Chikkies Containing Coca attract 18% GST & other Chikkies Without Coca attracts 5%: AAR [Read Order]

The Authority for Advance Ruling (AAR), Karnataka has held that Chocolate Chikkies containing Coca shall attract Goods and Services Tax (GST) at the rate of 18% and other Chikkies without Coca shall attract 5% GST.

The ruling came in response to the application filed by Sirimiri Nutrition Food Products Private Limited, a manufacturer of nutrition food products seeking clarity on the classification and GST rates applicable for their new variety of chikkies.

The applicant is engaged in the production of nutrition food products and is set to introduce a new variety of chikkies into the market.

The applicant Company, represented by its Managing Director, Sri Srinivas R Gururajan sought clarification on the Harmonized System of Nomenclature (HSN) Code and the applicable GST rates for their variety of chikkies containing coco such as dry fruit chikkies and that do not contain coco.

The applicant also sought clarification on the correct head under which these chikkies shall be classified.

The AAR clarified that the chikkies that do not contain cocoa will attract a GST rate of 5%, while those containing cocoa will be subject to a higher rate of 18% GST.

The ruling is based on the HSN classification of the chikkies and the ingredients used in their preparation.

The authority comprising Dr. M P Ravi Prasad, State Goods and Services Tax (SGST) Member and Sri. Kiran Reddy T, Central Goods and Services Tax (CGST) Member held that the chikkies falling under the category of “Sugar Confectionery not containing cocoa” are classified under Chapter heading 1704 and are taxable at 5% GST. This category includes products such as Sesame Chikkies, Amaranth Chikkies, Crushed Peanut Chikkies, Spirulina Chikkies, and Dry Fruit Chikkies.

On the other hand, Chocolate Peanut Chikkies, which contain cocoa powder, are classified under Chapter heading 1806 90 20, falling under the category of “Sugar Confectionery containing cocoa” which are subject to 18% GST.

It was further clarified that Dry Fruit Chikkies, despite containing various dry fruits, will also fall under the category of “Sugar Confectionery not containing cocoa” and, therefore, be classified under chapter heading 1704, attracting 5% GST.

To Read the full text of the Order CLICK HERE

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