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2021 (1) TMI 543 - AAR - GSTClassification of goods - HSN Code - Organic Manure - Bio-fertilizers - Granulated Nutrient Mixture - Phosphatic Rich Fertilizers - whether these products are correctly classifiable under Sub-heading nos. 3101, 3101, 3102 & 3105, respectively? - Benefit of N/N. 01/2017-Central Tax (Rate) dated 28.06.2017. Organic Manure - HELD THAT:- The ingredients viz. Sulphur Powder, Rock Phosphate and Bentonite, Gypsum, Potassium Humate and Bio-Fulvic are certainly not covered under the Animal or Vegetable products. For the product to be covered under Chapter head 3101 it is of vital importance that the product should necessarily be either direct animal or vegetable fertilisers such as ‘manure’ whether mixed together and chemically treated or otherwise and those obtained by mixing or chemical treatment of animal or vegetable products - composition of the product contains Amino Acids (Bio-culture amino acids). The key elements of an amino acid are carbon (C), hydrogen (H), oxygen (O), and nitrogen (N), although other elements are found in the side chains of certain amino acids. Thus, the presence of nitrogen in the product is visible. Further, it contains Potassium Humate and as such the presence of potassium is also visible. Rock Phosphate which is also one of the components of the product is a non-detrital sedimentary rock that contains high amounts of phosphate minerals. Thus, the product also contains phosphate elements. In addition, the product contains minerals viz. Sulphur Powder and Bentonite. Thus, it is seen that the product is a mixture of animal or vegetable products, minerals, nitrogen, phosphate and potassium - the product merits classification under Tariff Item No. 31059090-Other, of the First Schedule to the Customs Tariff Act, 1975(51 of 1975). If said products are clearly used as fertilizers, it will be covered under Entry at Sl. No.182D of Schedule-I of Notification No.1/2017-Central Tax (Rate) dated 28.06.2017 of the CGST Act, 2017 on which total rate of GST chargeable will be 5%. Bio-fertilizers - HELD THAT:- 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 Sub-heading 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). Further, as per Vikaspedia, bio-fertilizers are produced by culturing of microorganisms and that such cultured microorganisms packed in some carrier material for easy application in the field are called bio fertilisers. Thus, it can be seen that bio-fertilizers are produced by culturing of micro-organisms which is covered by the Entry ‘cultures of micro-organisms(excluding yeast)’ which falls under Sub-heading No.30029030 - the product, “Bio-fertilizers” manufactured and supplied by the applicant are classifiable under Tariff item No.30029030 of the First Schedule to the Customs Tariff Act, 1975(51 of 1975) and covered under Entry at Sl. No.61 of Schedule-II of Notification No.1/2017-Central Tax (Rate) dated 28.06.2017 of the CGST Act, 2017 on which total rate of GST chargeable is 12%. Nitrogenous Mixture Fertilizers - HELD THAT:- The product, “Nitrogenous Mixture Fertilizers” manufactured and supplied by the applicant consisting of Ammonium Sulphate and Urea mixed with Gypsum, Bentonite, Amino Acids and Bio-fulvic Potassium Humate and, hence, are classifiable under Tariff Item No.31029090- Other, of the First Schedule to the Customs Tariff Act, 1975(51 of 1975). If said products are clearly used as fertilizers, it will be covered under Entry at Sl. No.182A of Schedule-I of Notification No.1/2017-Central Tax (Rate) dated 28.06.2017 of the CGST Act, 2017 on which total rate of GST chargeable will be 5%. Mixture of Fertilizer - fall under the Sub-heading 31059090 as claimed by the applicant or otherwise - HELD THAT:- The product, ‘Mixture of Fertilizers’ manufactured and supplied by the applicant consisting of Nitrogen, Phosphorus, Potassium and Organic Content in the form of Urea, DAP, MOP, Gypsum, Rock Phosphate, Ammonium Sulphate, Bentonite, Dolomite, Amino Acids, Bio-Fulvic, Potassium Humate, Poultry and Organic Ash. Hence, the said product merits classification under Tariff Item No. 31059090-Other, of the First Schedule to the Customs Tariff Act, 1975(51 of 1975). If said products are clearly used as fertilizers, it will be covered under Entry at Sl. No.182D of Schedule-I of Notification No.1/2017-Central Tax (Rate) dated 28.06.2017 of the CGST Act, 2017 on which total rate of GST chargeable will be 5%.
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