The Authority for Advance Ruling (AAR), Tamil Nadu, ruled that processed frozen shrimps, when packed in individual printed or plain pouches or boxes, fall under the ‘pre-packaged and labelled’ category. This classification has significant implications for exporters, as it brings these products under the ambit of the Goods and Services Tax (GST).
The applicant, M/s Asvini Fisheries Private Limited, is engaged in the business of exporting processed shrimps, The applicant sources shrimps locally from farmers, which undergo further processing in the factory such as receiving, washing, de-veining, peeling, de-heading, tail removal, sorting, grading and freezing. Processing steps performed by the applicant is entirely dependent on the customer’s requirements/order. Based on the customer requirement, one or more processing steps can be performed independently to produce the desired results.
The applicant stated that the processed raw materials are packed immediately according to the buyer’s instructions. The packaging process involves two types: primary or inner packaging, which includes inner boxes or pouches, and secondary or outer packaging, which involves master cartons. The processed products are weighed and packed into food-grade polythene pouches or boxes, with the weight of the individual inner packaging generally ranging from about 250 grams to 2 kilograms. The customer brand name and other details, as provided by the customer for export sales, are printed on these pouches or boxes. These are then further packaged in master cartons with a maximum weight of up to 25 kilograms.
Arihanth Kumar Jain and Lokesh Reddy. N, the authorised representatives of the applicant, sought for advance ruling regarding whether the export of processed frozen shrimps (HSN: 0306), packed in individual printed pouch/box, further packed inside a printed master carton
(of upto 25 kgs each) containing the design, label, and other particulars provided by the buyer, attracts GST and whether the export of processed frozen shrimps (HSN: 0306), packed in
individual plain pouch/box, further packed inside a plain master carton (of upto 2S kgs each), attracts GST.
The AAR observed that “both the entries relate to goods other than fresh and chilled, the only distinction being whether the goods are ‘pre-packaged and labelled’, or other than ‘pre-packaged and labelled’. Hence, the point for determination herein is as to whether the supply of specified pre-packaged and labelled frozen shrimp meant for export would fall within the meaning of the definition of ‘pre-packaged and labelled commodity’ under the Legal Metrology Act, 2009, and the rules made thereunder, as defined under explanation (ii) of the respective notifications”.
The bench of D. Jayapriya and A. Valli further observed that the GST would be applicable on the supply of pre-packaged and labelled shrimps up to 25 kgs, irrespective of whether it is meant for domestic supplies or for export, as long as they are specified commodities that are pre-packaged.
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