Heritage Foods to Claim ₹4.53 Crore Refund of GST Paid Under Protest
Heritage Foods Limited is set to claim a refund of ₹453.44 lakh (₹4.53 crore) for GST paid under protest between July 1, 2017 and October 31, 2021, following a favorable judgement by the Supreme Court of India. The refund amount includes Integrated GST (IGST) of ₹17.05 lakh, Central GST (CGST) of ₹218.20 lakh, and State GST (SGST) of ₹218.20 lakh.
Background of the Case
The dispute arose over the GST classification of flavored milk. Initially, the Additional Commissioner of GST, Tirupati, had classified flavored milk under GST Tariff Heading No. 2202 9930, attracting a 12% GST rate (6% CGST + 6% SGST) and demanded a differential tax payment of ₹3.52 crore along with penalties and interest.
Heritage Foods paid the disputed GST amount under protest and challenged the classification in the Andhra Pradesh High Court. The High Court ruled that flavored milk appropriately falls under Tariff Heading No. 04029990 with a GST rate of 5% (2.5% CGST + 2.5% SGST), setting aside the demand order for the higher tax rate and the associated penalties.
The GST Department of Andhra Pradesh contested the High Court decision by filing a Special Leave Petition (SLP) with the Supreme Court. On July 17, 2025, the Supreme Court dismissed the SLP, thereby upholding the High Court’s judgment and allowing Heritage Foods to claim a refund of the excess GST paid.
Financial and Legal Impact
The refund entitlement totals ₹453.44 lakh, covering IGST, CGST, and SGST components paid during the disputed period.
No penalties or non-compliance issues were noted against Heritage Foods in this ruling.
The classification of flavored milk under the appropriate HSN code (04029990) with a 5% GST rate is now conclusively settled.
Heritage Foods has adjusted its GST tariff for flavored milk accordingly to align with judicial pronouncements.
Next Steps
Heritage Foods will file the refund application as directed by the courts to reclaim the GST amounts paid under protest. This outcome highlights the importance of correct GST classification and the legal remedies available to taxpayers against disputed tax demands.
Frequently Asked Questions
What led to Heritage Foods claiming this GST refund?
Heritage Foods paid higher GST on flavored milk under protest, following a tax demand for classification under a higher GST rate. The courts ruled in their favor on proper classification and allowed the refund claim.
How much is the GST refund Heritage Foods will receive?
The company will claim ₹453.44 lakh (₹4.53 crore) covering IGST, CGST, and SGST paid between July 2017 and October 2021.
Which courts were involved in the dispute?
The Andhra Pradesh High Court initially ruled in favor of Heritage Foods. The Supreme Court dismissed the government’s appeal, confirming the refund rights.
What is the GST classification for flavored milk now?
Flavored milk is classified under HSN code 04029990 attracting a total GST of 5% (2.5% CGST and 2.5% SGST) instead of the previous 12% rate.
Are there any penalties or compliance issues related to this case?
No penalties or non-compliance issues were reported as per the Supreme Court order.
Published on: July 22, 2025
Published by: PAVAN
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