With social media going into overdrive after the Authority for Advance Ruling (AAR) said parotas should attract 18 percent GST, a government official said the ruling pertained to frozen foods, which cannot be considered a staple item.

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"Frozen parota is preserved, sealed packed, branded, sold at good prices, not a staple item and consumed by the class which can afford to pay tax. Even items like cheaper biscuits, pastries, cakes, etc, attract GST at the rate of 18 percent.," a government official told CNBC-TV18.

“Frozen foods cannot be comparable to plain roti or plain parota served in restaurants or taken as staple food, or eaten by poor on day-to-day basis," the official added.

The AAR (Karnataka) held that such frozen and preserved parota would not be entitled to concessional rate as available to roti (plain roti and khakra attract 5 percent GST rate). It further said that frozen and preserved parota would attract GST at the rate of 18 percent.

The AAR ruling, passed after ID Foods approached it, led several users on Twitter thinking it applied to all parotas and that the authority was distinguishing between a parota and a roti, both staple varieties of Indian bread.

The official quoted above said that plain roti or parota served in a restaurant or provided in takeaway will continue to attract 5 percent GST only.

"Such plain rotis or parotas are not a frozen product. Parota, which are sold under a brand and in sealed cover with a shelf life ," the official said.

Further, AAR rulings are area and product-specific, the official noted.

The issue of the rate of frozen and preserved parota was discussed in the 37th GST Council meeting.

The Council did not recommend reduction in the GST rate on frozen and preserved parotas for the reasoning that these are sold by the organised sector.

First Published:Jun 12, 2020 6:50 PM IST