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2021 (1) TMI 369 - AAR - GSTClassification of goods - applicable rate of tax - Hybrid Hydraulic Servo System which is prepared by assembling various parts and is used as part in different type of machines - whether the said product falls under Chapter Heading 8479 or any other suitable Chapter Heading of the Customs Tariff Act, 1975? - HELD THAT:- On the basis of the classification of the said product, it will be leviable to appropriate rate of Goods and Services Tax prescribed under Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017 issued under the Central Goods and Services Tax Act, 2017 (herein after referred to as the ‘CGST Act, 2017’) and corresponding Notification issued under the Gujarat Goods and Services Tax Act, 2017 (hereinafter referred to as the ‘GGST Act, 2017’) or the Integrated Goods and Services Tax Act, 2017 - From Note 2 of Section XVI of the Customs Tariff Act, 1975 and General Note of Parts of Section XVI of Harmonised System of Nomenclature, it can be seen that parts suitable for use of any particular machine or class of machine would be classified in the same heading of the particular machine or class of machine. Further, parts which can be used as such and are not suitable for any particular machine or class of machine and may be common to a number of machine falling in different headings are to be classified in heading 84.87 (if not electrical) or in heading 85.48 (if electrical). The applicant has contended that the product viz. “Hybrid Hydraulic Servo System” may merit classification under 8479 with description “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this Chapter [other than Composting Machines]” - It is found that Tariff Heading 8479 of custom Tariff Act, 1975 covers the Machine and Mechanical appliances having individual functions, not specified or included elsewhere in this chapter. Tariff Heading 8479 as per Harmonised System of Nomenclature. The applicant has submitted the catalogue of the product, wherein design and scientific parameter of manufacture of the product is given. However, they did not mention the usage of the said product in the different type of machines or class of machines. Further, it is seen that applicant in the application has submitted that, “Hybrid Hydraulic Servo System” as such Servo System or Drive give right solution for Servo pump control, providing precise pressure and flow control and avoiding the energy waste thus creating added value for customers in terms of energy efficiency and higher mould quality”. Hence, it appears that the product does not have any individual functions or it can be stated that the said product cannot perform itself which is the prime condition for classification under Heading 8479 of Custom Tariff Act, 1965. Therefore, the said product cannot be classified in the Chapter heading of 8479 of Customs Tariff Act, 1975. Thus, the product viz. Hybrid Hydraulic Servo System” merits classification in terms of Note 2 of Section XVI of the Customs Tariff Act, 1975 and General Note of Parts of Section XVI of Harmonised System of Nomenclature. Accordingly, the rate of GST of the said product would be determined according to the classification of the product.
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