2026-VIL-131-AAR
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SGST Advance Ruling Authority

GST – Gujarat AAR - Classification and applicable GST Rate on Papad Khar - Food processing ingredient - Whether Papad Khar should be classified under HSN 2501 (Common Salts) at 5% or HSN 2102 (Prepared Food Additives) at 5% or should qualify for exemption under Notification 2/2017 - The applicant contended that Papad Khar is a traditional alkaline salt with composition of 70% sodium chloride, 15% sodium carbonate and 15% sodium bicarbonate used as food ingredient and should be classified under HSN 2501 or 2102 at 5% rate – HELD - Papad Khar does not qualify for HSN 2501 classification because its chemical composition differs materially from common salt which contains 100% sodium chloride and rock salt which contains 90-98% sodium chloride. Further the product is obtained through mixing and processing beyond that permitted under Chapter 25 notes which exclude products obtained by mixing or subjected to processing beyond that mentioned in each heading. The product does not fall under HSN 2102 because yeasts have different constituents and baking powder serves different culinary purposes from Papad Khar. However Papad Khar as mixture of sodium carbonate and sodium bicarbonate with sodium chloride falls squarely under HSN 28362090 covering carbonates and bicarbonates - The product does not qualify for exemption under Notification 2/2017 because GST classification and rates of raw materials and finished products are determined independently based on their specific tariff entries, not automatically on the basis that the finished product is exempt - Papad Khar is correctly classifiable under HSN 28362090 and liable to GST at 18% - Ordered accordingly.
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