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2017 (7) TMI 1236 - AUTHORITY FOR ADVANCE RULING - MAHARASHTRARate of tax - Crysol CU - classification of goods - whether classified under CETH sub-heading 38231900 or not - NOTIFICATION No. VAT-1505/CR-234/Taxation-1, dated-September 1, 2005, Whether the impugned products are covered by the Notification issued by the state government for the purpose of Schedule Entry C-54 or otherwise? Whether the impugned products are covered by chapter 29 or otherwise? - Held that:- The impugned products do not satisfy the requirements / qualifications as laid in Note-I specifically (a) and (b). Similarly, the impugned products are not separate chemically defined elements or compounds (usually classified in Chapter 28 or 29) and not covered with the exception provided there in. Therefore, the products cannot be classified under chapter 29 of Central Excise Tariff Act, 1985 (CETA). - The Crysol CU and its variants are not mono-carboxylic acids. A carboxylic acid is an organic compound that contains a carboxyl group (C (=O) OH). The general formula of a carboxylic acid is R-COOH, with R referring to the rest of the (possibly quite large) molecule. The applicant has admitted the interpretation regarding CET H No.38231900 during the course of hearing and stated that he is not pursuing the said CET H No. for the impugned product. Therefore, the impugned products, Crysol CU and its variants are not covered by CET H No. 38231900 as mentioned in sales invoices. The CETH 3814 is covered at serial number 178 in the Notification Dt. 01.09.2005 issued to define "Industrial Inputs" for the purpose of Schedule Entry C-54. However, the description of goods in column 5 of the said notification against CETH 3814 is restricted to products, "Reducers and blanket wash/roller wash used in the printing Industry". The description of goods sold by the dealer i.e. Composite Organic Solvent and description given in notification Dt 01.09.2005 at Serial number 178 does not match. Hence the Note No. 2 appended with notification is applicable. The note no. 2 states that "Where any commodities are described against any heading or, sub-heading or as the case may be, tariff item, and the aforesaid description is different in any manner from the corresponding description in the Central Excise Tariff Act, 1985, then only those commodities described as aforesaid will be covered by the scope of this Notification and other commodities though covered by the corresponding description in the Central Excise Tariff will not be covered by the scope of this Notification. Hence the impugned product is not covered by the Notification Entry, 178. The Crysol CU, being a blend of various chemicals as shown above in Table-2. The Crysol CU 132 is a versatile organic solvent used in various industries for different purposes, which is rapidly replacing other cleaning processes such as emulsion cleaning, alkaline cleaning and steam cleaning." and hence shall not be covered under the scope of Schedule Entry, C-54 and covered under schedule 'E-1' of MVAT Act 2002. The prospective effect - use of discretionary power - Held that:- he applicant cannot prove existence of circumstances which warrant us to use the discretionary power. In fact use of such discretionary powers in the absence of compelling circumstances would be detrimental to legitimate government revenue and would wipe out the legitimate tax liability In these circumstances, we do not allow the use of prospective effect as a tool to protect or to wipe of legitimate tax liability. Ruling:- The commodities, mentioned in Table-1, as above do not find place in the entries of other schedules (A, B, C or D). Hence, they are covered by residuary entry, E-1 of MVAT Act, 2002 and are liable to VAT at the rate provided in said Schedule. The prayer to grant prospective effect to this order is rejected.
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