Ahmedabad-based Vadilal Industries, manufacturer and supplier of a wide range of ‘parathas’, could not succeed in convincing the Appellate Authority for Advance Rulings (AAAR) that a paratha is the same as the Indian bread roti. Or that, as wheat flour is its primary ingredient, it bears a close resemblance to ‘roti’ and ‘chapatti’ and hence should be taxable at a 5% GST rate.
The appellate authority upheld the ruling given to this company last year by the Gujarat bench of the Authority for Advance Rulings (AAR) that an 18% GST rate would apply to ready-to-cook, or frozen, parathas.
A plain roti or chapatti contains only wheat flour and water and is consumed directly, whereas parathas require heating (cooking) before consumption. In this case, the AAAR disregarded the ruling given by the Maharashtra AAR, which had held parathas to be eligible for the concessional tax rate. Both the Kerala and Gujarat AARs have distinguished parathas from rotis.