BackReady-to-eat frozen parotas to attract 18% GST; 5% for plain parotas, clarifies CBIC
Ready-to-eat parotas, unlike rotis, need to be further processed for human consumption and hence are liable for 18% GST
PremiumNEW DELHI : The Central Board of Indirect Taxes and Customs (CBIC) in a series of tweets clarified on Friday that the Authority of Advance Ruling (AAR) has decided that frozen (and preserved) wheat parota and Malabar parota available in ambient and frozen form with a shelf life of three-seven days is not plain roti but a distinct product. Ready-to-eat parotas, unlike rotis, need to be further processed for human consumption and hence are liable for 18 per cent GST, the AAR has said.
Bengaluru-based ID Fresh Foods had approached the Karnataka bench of the Authority of Advance Ruling (AAR) on whether preparation of whole wheat parota and Malabar parota can be classified under Chapter 1905 attracting 5 per cent GST.
The AAR in its ruling said that parotas are neither rotis or khakhras and hence cannot be taxed at 5 per cent.
"Hence, such frozen and preserved parota is not like a plain roti, Khakhra etc. Accordingly, the AAR held that such frozen and preserved parota would not be entitled to concessional GST rate as available to roti (plain roti, khakra etc attracts concessional GST rate of 5 per cent GST).
"It has been held by AAR that frozen and preserved parota would attract GST at the rate of 18 per cent," the CBIC said.
The applicant ID Fresh Foods is involved in preparation and supply of ready-to-cook items like idli and dosa batter, parota and chapatis, among others.
The AAR in its ruling said parota is neither khakhra, plain chapatti nor roti.
"Further, the products khakhra, plain chapatti and roti are completely cooked preparations, do not require any processing for human consumption and hence are ready to eat food preparations, whereas the impugned product (whole wheat Parotas and Malabar Parotas) are not only different from the said khakhras, plain chapatti or roti but also are not like products in common parlance as well as in the respect of essential nature of the product.
"These products also require further processing for human consumption," the AAR said.
Explaining further, a finance ministry official said frozen parota is preserved, sealed packed, branded, not a staple item and consumed by a class which can afford to pay tax. Even items like biscuits, pastries and cakes attract 18 per cent GST.
The official further said that plain roti or parota served in a restaurant or provided in takeaways get same treatment in rates and attract 5 per cent GST only.
Also, this order does not decide the rate of ordinary plain parota.
"The ordinary or any parota served for consumption by a restaurant or a takeaway would attract 5 per cent GST rate just like plain roti," the official said.
Also, the GST Council at its 37th meeting had discussed the rate on frozen and preserved parota and did not recommend to reduce the tax rate as this product is sold by the organised sector, the official added.
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This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.
