Ready-to-eat popcorn to attract 18% GST

The Gujarat bench of the Authority for Advance Rulings (AAR) has held that a GST of 18% is applicable to the supply of ready to eat popcorn. The applicant, a Surat-based manufacturer of popcorn sought an advance ruling claiming that the supply should be taxed at 5%. The applicant, while making a reference to a similar case, claimed that the Supreme Court has stated that parched rice would fall under the same HSN category as puffed rice. Similarly, the product supplied by the manufacturer was nothing but puffed corn and hence should only attract a GST of 5% and not 18%. The AAR, however, held a different view and stated that the applicant added a variety of spices to the finished product and hence the product no longer fell under the category of' grain'. As such, the product manufactured by the applicant fitted the description of 'Prepared foods obtained by the roasting of cereal' and would be taxed at 18%.