When the food materials prepared in oils and fats are kept for a long time, they start giving unpleasant smell and taste. The fat and oil containing food materials which have unpleasant smell and taste are said to become rancid. This happens due to oxidation of oils and fats by the oxygen present in air.
Chips are also prepared in oils and fats. When the chips are surrounded by unreactive gas nitrogen, there is no oxygen of air to cause its oxidation and make it rancid, as nitrogen is an inert gas and does not react easily. So, bags used in packing food items are flushed with nitrogen gas to prevent them from becoming rancid.