Whole animal carcass packed in LDPE/HDPE bags shall not qualify as product put up in “unit container”: AAAR

Categories: Advance Ruling
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Facts: M/s. Ahmednagar District Goat Rearing and Processing Co-Op Federation Ltd. is engaged in slaughtering & processing of Sheep/Goat meat and supplies these products i.e. Sheep/ Goat meat in carcass form i.e. the whole animal carcass in its natural shape in frozen state to Army against tenders issued by the Indian Army. Further, there is no fixed quantity & size in which these carcasses are dispatched to Army, as the said dispatches are made on the basis of the weight of the frozen carcass which varies in every case, depending upon the weight of the animal’s carcass packed in different consignments and the consideration is also charged on the basis of weight of the meat supplied which is not uniform and not pre-determined in each consignment.

Applicability of GST on these goods arises only when the following conditions are met:

  1. Up till 14th November 2017, if product is “Frozen” and put up in “Unit container”
  2. On or after November 15 2017, if the product is “Frozen”, put up in “Unit Container” and is “Branded”.

The Hon’ble AAR, The Maharashtra, vide order no GST-ARA-21/2017-18/B-27 dated 21/04/2018, decided that the supplies made by the appellant were in unit containers and accordingly were chargeable to tax under schedule II entry No. 4 of the Notification 01/2017-lntegrated Tax (Rate) dated June 28, 2017 for the period July 01, 2017 to November 13, 2017 and thereafter under schedule I entry No. 1 of the Notification 01/2017-lntegrated Tax (Rate} dated June 28, 2017 as amended vide Notification 43 of 2017- Integrated Tax (Rate} dated  November 14, 2017.

Issues Involved:

  1. Whether the packaging being used for dispatch to Army shall qualify as “Unit Container” under the GST law?
  2. Whether the product, i.e. sheep/goat meat in frozen state and packed as mentioned in the facts stated above shall be liable to be taxed under GST or would it be treated as exempted?

Held: The Hon’ble AAAR of Maharashtra vide Order No. MAH/AAAR/SS-RJ/10/2018-19 dated September 11, 2018 held that the whole “Sheep/Goat” animal carcass in its natural shape in frozen state in different weight and size packed in LDPE bags without mentioning the weight and one or two such LDPE bags further packed in HDPE bags being supplied to Army by appellant against tender shall not qualify as product put up in “Unit Container” as per definition provided in the explanation to the Notification No. 01/2017-IGST (Rate) dated June 28, 2017 as amended i.e. The phrase “unit container” means a package, whether large or small (for example, tin, can, box, jar, bottle, bag, or carton, drum, barrel, or canister) designed to hold a predetermined quantity or number, which is indicated on such package.Therefore, the Ruling given by AAR, Maharashtra, stands modified in view of the above and appeal is allowed.

Citation: [2018] 97 taxmann.com 386 (AAAR-MAHARASHTRA)