Authority for Advance Rulings, Gujarat Jay Jalaram Enterprises, In re – [2020] 117 taxmann.com 296 (AAR – GUJARAT)

The assessee was a proprietorship concern and manufacture Pop Corn, which sold in a sealed plastic bag bearing a registered brand name.

It filed an application for advance ruling to determine classification and rate which would be applicable on the supply made by it.

 It contended that its product which is popularly known as POPCORN is nothing but CORN/MAIZE, which is a CEREAL, falling under Chapter 10.

The Authority for Advance Ruling (AAR) observed that the issue involved in this case pertains to classification of the product ‘POP CORN’ put up in unit container and bearing a registered brand name.

It also observed that the product in question i.e. ‘POP CORN’ is manufactured from raw corn/maize grains, by heating in an electric machine/oven at the temperature of 1800 to 2000 centigrade and due to the heat so given to the grains, they turn into puffed corns/popcorns.

After that, to make it palatable other ingredients like salt and turmeric powder are added to it and a negligible quantity of oil is also used for the purpose of sticking the salt and turmeric on the maize/corn.

Thus it is a ready to eat prepared food and fits the description as ‘Prepared foods obtained by the roasting of cereal’.

 This description attracts classification under Chapter Sub-Heading 1904 10 of the First

Schedule to the Customs Tariff Act, 1975 and would attract 9% CGST and 9% SGST or 18% IGST.