The Karnataka Authority of Advance Ruling (AAR) has held that Chocolate Peanut Chikkies attract 18% GST, whereas other chikkies attract 5% GST.The bench of M.P. Ravi Prasad and Kiran Reddy T. has held that the product "Chocolate Peanut Chickies" contains cocoa powder. Cocoa and Cocoa Preparations are covered under Chapter 18. Chapter heading 1806 covers Chocolate and other food...
The Karnataka Authority of Advance Ruling (AAR) has held that Chocolate Peanut Chikkies attract 18% GST, whereas other chikkies attract 5% GST.
The bench of M.P. Ravi Prasad and Kiran Reddy T. has held that the product "Chocolate Peanut Chickies" contains cocoa powder. Cocoa and Cocoa Preparations are covered under Chapter 18. Chapter heading 1806 covers Chocolate and other food preparations containing cocoa, and chapter heading 1806 90 20 covers Sugar Confectionery containing Cocoa. Thus, the product "Chocolate Peanut Chikkies," which contains cocoa powder, is covered under the chapter heading 1806 90 20 and attracts 18% GST.
The applicant is in the manufacturing of nutritional food products. They intend to manufacture new varieties of chikkies, i.e., sesame chikkies, chocolate peanut chikkies, amaranth chikkies, crushed peanut chikkies, spirulina chikkies, and dry fruit chikkies.
The applicant sought an advance ruling on the classification of the variety of chikkies and the applicable GST.
The AAR noted that Sugar preparations that are marketed in a solid or semi-solid form and are generally suitable for immediate or direct consumption without further processing are collectively referred to as confectioneries. Chikkis, which are jaggery-based preparations meant for direct consumption as snacks, are squarely covered under the term sugar Confectioneries.
The AAR found that chapter 17 of the Customs Tariff Act 1962 covers sugar and Sugar confectionery, and chapter heading 1704 covers Sugar Confectionery (including white Chocolate) not containing cocoa. Thus, all the sugar confectionery that does not contain cocoa is covered under the heading 1704.
The AAR held that all products except "Chocolate Peanut Chikkies" do not contain cocoa, and thus the products "Sesame Chikkies, Amaranth Chikkies, Crushed Peanut Chickies, Spirulina Chikkies, and Dry Fruit Chickies" are squarely covered under Sugar Confectionery and thus fall under heading 1704.
Applicant’s Name: Sirimiri Nutrition Food Products Private Limited.
Date: 13/07/2023