Page 126 - GSTL_16th July 2020_Vol. 38_Part 3

364 GST LAW TIMES [ Vol. 38
rice was also comprehensively laid before the AAR along with the statutory and
mandatory requirement of Food Safety and Standards Authority of India, Minis-
try of Health and Family Welfare, whereby the appellant tried to convince that
the FRK is nothing but a better nutritional form of Rice.
4.4 The Rajasthan Authority for Advance Ruling, vide Advance Ruling
No. RAJ/AAR/2019-20/27, dated 28-11-2019, has held that -
Fortified Rice Kernels (FRK), manufactured and supplied by the applicant
is classifiable under HSN 1904 90 90 and attracts GST @ 18% (SGST 9% +
CGST 9%).
4.5 Aggrieved by the aforesaid Ruling above, the appellant has pre-
ferred the present appeal before this forum.
Grounds of appeal
5. The appellant in its Appeal has, inter alia, mentioned the following
grounds of Appeal :
5.1 The decision passed by the Ld. AAR is bad in law, as the same is
without jurisdiction as the Ld. AAR has no jurisdiction on deciding the rate of
duty on particulars goods, because the rationale and reasoning in fixing quan-
tum of levy is a policy decision of Government(s)/GST Council and thus, is be-
yond the scope and domain of Ld. AAR.
5.2 While holding the goods manufactured and supplied by the appel-
lant under HSN 1904 90 90, the Ld. AAR has failed to give any cogent reasoning
much less any reasoning whatsoever in this regards.
5.3 The GST Council vide Circular No. 52/26/2018-GST, dated 9-8-2018,
has taken decision with regards to the taxability of Fortified Toned Milk and clar-
ified that toned milk fortified (with vitamins ‘A’ and ‘D’) attracts NIL rate of GST
under HSN Code 0401.”
5.4 That whilst considering the taxability of similar kind of product i.e.,
Fortified Milk, milk having additional or enriched with minerals and vitamins,
the Council has held that the same should be classified under the tariff heading
of Milk only. The Ld. AAR, ought to have considered the decisions taken by the
GST Council, which can not only be applied in the present case but is also bind-
ing on the Ld. AAR.
5.5 The Ld. AAR, while considering the Circular dated 9-8-2018 (su-
pra), has drawn a distinction between the Fortified Toned Milk and FRK. The Ld.
AAR has held that fortified milk is final consumable product however, the FRK
is not. Such distinction is erroneous, not tenable in law inasmuch as without ap-
plication of mind. It is submitted that consumption of any product is no basis for
taxability of the final product. So far as the said contention of the Ld. AAR is
concerned, it is submitted that even FRK is a marketable product and is being
sold in market separately without blend the same in rice.
5.6 The Rice is specified in Chapter 10 of the Tariff and further includes
Rice in husk (paddy or rough), husked (brown) rice, semi-milled or wholly-
milled whether polished or glazed, basmati rice, broken rice parboiled rice.
Therefore, from the said it is apparently clear that Chapter 10, apart from the
natural form of rice also contains processed rice. Accordingly, the contention of
the Ld. AAR that rice in its natural form with its essential characteristics as intact

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