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2021 (10) TMI 50 - AAAR - GSTClassification of bio agricultural products - rate of GST - RhizoMyx - Rhizomyco - classifiable under Chapter 3101 or under Chapter 3002 of CETA - HELD THAT:- Taking into consideration the fact that no chemicals are contained in the aforementioned products and there is the presence of endomycorrhiza and ectomycorrhiza (which are microorganisms), it can be seen that the said products manufactured and supplied by the appellant are biofertilisers. Since the definition of vegetable fertilisers is not available anywhere, hence it would have to be construed in generic terms. In generic terms, vegetable fertilisers would be the fertilizers derived from vegetable matter like compost and crop residues - Vikaspedia defines biofertilisers as under: In nature, there are a number of useful soil micro organisms which can help plants to absorb nutrients. Their utility can be enhanced with human intervention by selecting efficient organisms, culturing them and adding them to soil directly or through seeds. The cultured micro organisms packed in some carrier material for easy application in the field are called bio-fertilisers. Thus the critical input in Biofertilisers is the microorganisms. On comparing the definition as well as the uses of Biofertilizers vis-a-vis Animal fertilier/organic fertilizer/vegetable fertilizer, it can be seen that Biofertilsers are completely distinct in nature and use to these fertilisers. In view of these facts, we conclude that biofertilisers are not covered under the Sub-heading 3101 of the First Schedule to the Customs Tariff Act, 1975(15 of 1975) - the entire portion of the description of goods except ‘cultures of micro-organisms (excluding yeasts)’ pertains to the medical field. On going through the said Subheading 3002, it is seen that ‘cultures of micro-organisms (excluding yeasts)’ appears at Tariff entry No.30029030 of the First Schedule of the Customs Tariff Act, 1975 (51 of 1975). Looking to the process of manufacture/production of biofertilizers, their uses, the specific subheadings covered under the above heading as well as the explanatory notes to HSN of the above heading, it can be concluded that the biofertilizers namely Rhyxomyx and Rhyxomyco manufactured and supplied by the appellant are classifiable under Tariff item No.30029030 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), is covered under Sr.no.61 of Schedule-II of Notification No.01/2017-Central Tax(Rate) dated 28.06.2017(as amended from time to time ) and is liable to GST at 12%. As per Rule 3(a), it is found that where goods are, prima facie, classifiable under two or more headings, the heading which provides the most specific description shall be preferred to headings providing a more general description. The appellant has not given any specific grounds other than the reference to the aforementioned judgement to support their contention that their products are classifiable under Heading 3101. However, we find that Sub-heading 3002 provides the most specific description to the biofertilisers manufactured and supplied by the appellant. The products ‘Rhyzomyx’ and ‘Rhyzomyco’ manufactured and supplied by M/s. Novozymes South Asia pvt.ltd., are classifiable under Tariff item No.30029030 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), is covered under Sr.no.61 of Schedule-II of Notification No.01/2017-Central Tax (Rate) dated 28.06.2017(as amended from time to time ) and is liable to GST at 12% - appeal dismissed.
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