Case Reference:
Sri Vijaya Visakha Milk Producers Company Ltd v. Assistant Commissioner of Central Tax and Others, High Court of Andhra Pradesh at Amaravati, Writ Petition No. 28222 of 2024, decided on 08 January 2025
Relevant Sections:
Classification dispute under the GST Tariff – Heading 0402 vs 2202; covered under Section 9 of CGST Act 2017 read with Section 15 and Schedule II; Rule 46 of CGST Rules 2017 (invoice classification).
Category: Classification dispute – rate of GST on flavoured milk.
Facts (Para 1–2):
The petitioner, Sri Vijaya Visakha Milk Producers Company Ltd, challenged an order dated 23.08.2024 (Order-in-Original No. 28/2024-25/ASK/GST DIN No. 20240855YJ000000BF2F) classifying flavoured milk under Heading 2202 99 30, attracting 18% GST as beverages containing milk. The petitioner contended that the product remains milk even after flavouring, thus properly classifiable under Heading 0402 99 90, taxable at 5%.
Questions before the Court (Para 1–2):
Whether flavoured milk should be taxed under tariff heading 0402 99 90 (milk and cream, concentrated or containing added sugar or other sweetening matter) or under heading 2202 99 30 (beverages containing milk).
Observations (Para 2–3):
The Court noted that in W.P. No. 254 of 2024, decided on 10.12.2024 involving the same petitioner, it had already held flavoured milk to fall under Heading 0402. The reasoning therein emphasized that flavouring does not alter the essential character of milk; it remains a dairy product and cannot be treated as a beverage. The process does not amount to manufacture of a distinct beverage, thus aligning with the principles of essential character under Section 9 of the CGST Act.
Judgement (Para 3–4):
Following its earlier ruling, the Court set aside the impugned order dated 23.08.2024 and directed the assessing officer to reclassify the product under Heading 0402 99 90. The Writ Petition was allowed, and the demand raised under Heading 2202 was quashed. There was no order as to costs.
Table – Summary of Related Cases Referred
| Case Title | Citation / WP No. | Date | Held | Relevance |
|---|---|---|---|---|
| Sri Vijaya Visakha Milk Producers Co. Ltd v. Asst. Commissioner of Central Tax | W.P. No. 254 of 2024 (AP HC) | 10.12.2024 | Flavoured milk classifiable under 0402 | Binding precedent applied in current case |
Between Fine Lines – Practical Takeaway:
Producers of flavoured milk can confidently classify their product under HSN 0402 (milk products at 5% GST) instead of 2202 (beverages at 18%). This judgment reinforces that mere flavouring does not transform milk into a beverage for GST purposes. Authorities must adhere to consistency and avoid reopening settled classification disputes for the same taxpayer.
Disclaimer – “The above summary is for academic purpose only; not formal legal opinion. Seek professional opinion before application. Author or publisher or website shall not be responsible for any usage in any form.”
