In Order No. 37/AAR/2022 - AAR - AAR (Tamil Nadu) rules dried coconuts (shelled or peeled) supplied by M/s EMS COCOS attract 5% GST
Members R. Gopalsamy, I.R.S. & N. Usha [30-11-2022]

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Read Order: In Re: EMS COCOS

 

Chahat Varma

 

New Delhi, June 7, 2023: The Tamil Nadu bench of the Authority for Advance Rulings has ruled that dried coconuts (shelled or peeled), supplied by M/s EMS COCOS (applicant) attracted GST rate of 5%.

 

The applicant, engaged in the activities of manufacturing and trading of Coconut, Copra and Coconut shells, had sought advance ruling on whether the dried coconuts (shelled or peeled) used for human consumption shall be classified under Chapter 8, HSN 0801, on which rate of tax was ‘nil’.

 

The short point that arose in the instant case was whether the goods in question viz., dried coconuts (copra in trade parlance) meant for human consumption merit classification in Chapter Heading 0801 thereby attracting ‘Nil’ rate or in Chapter Heading 1203 thereby attracting 5% GST (CGST 2.5%+ SGST 2.5%).

 

The Authority examined Circular 163/19/2021-GST dated 6th October 2021, which clarified that the whole unbroken kernel could only be extracted from the shell when it converts to copra. The Authority observed that the applicant processes the copra by cutting it in half, sun drying it, and manually segregating it based on its round shape and cleanliness. The round and clean copra was sent for human consumption, while the irregularly shaped and dusty copra was sent to oil milling units. The Circular clearly stated that copra was classified under Heading 1203, regardless of its use. Therefore, the Authority held that the goods in question, being copra, shall be classified under Heading 1203.

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