TMI Blog2019 (1) TMI 420X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Chapter 39 of the GST tariff as articles of Plastic and would attract appropriate rate prevailing at the date and time of supply. - Case No. 22/2018 Order No. 21/2018 - - - Dated:- 14-12-2018 - RAJIV AGRAWAL AND MANOJ KUMAR CHOUBEY MEMBER Present on behalf of applicant: Alok Barthwal, Counsel for the Applicant PROCEEDINGS (Under section 98 of Central Goods and Services Tax Act, 2017 and the Madhya Pradesh Goods and Services Tax Act, 2017) 1. The present application has been filed u/s 97 of the Central Goods Services Tax Act, 2017 and MP Goods Services Tax Act, 2017 (hereinafter also referred to CGST Act and MPSGT Act respectively) by M/S NAGRANI WAREHOUSEING PRIVATE LIMITED (hereinafter also referred to as applicant), registered under the Goods Services Tax. 2. The provisions of the CGST Act and MPGST Act are identical, except for certain provisions. Therefore, unless a specific mention of the dissimilar provision is made, a reference to the CGST Act would also mean a reference to the same provision under the MPGST Act. Further, henceforth, for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST or MP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re be an expressed difference intentions indicated by the Central Excise Tariff Act, 1985 itself A reference to Explanatory Notes of HSN below Heading 63.06 covers a range of Textile articles usually made from strong industrially woven canvas. It, further mentions that tarpaulin are generally made of coated or uncoated manmade fibre, fabrics, or heavy to fairly heavy canvas (of hemp, jute, flax or corron). It is thus apparent that Heading 63.06 covers tarpaulins which are made of manmade fibre fabric of heavy canvas of hemp, jute, flax or corron as HDPE / Platic strip yarn is not manmade fabric, tarpaulin made of the said material would not fall wider Heading 63.06. Further Heading 39.06 applies to articles of plastics and articles of other materials of Heading No.39.01 to 39. 14. No doubt Heading No.39.06 is residuary Heading but it is residuary to Chapter 39 as all articles of plastics, which are not covered by earlier Headings, would fall under 39.26. As far as any article is made of plastic it will fall either in any one of the specific headings in Chapter 39 and failing which under Heading 39.26. As the impugned products are made of plastic and arc not mentioned specifically ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age articles classifiable under Item No.15A (ii) if any tariff item emerges, the said product would be considered to have been produced out of plastic material falling under Tariff Item No. 15A (i) and, therefore, the HDPE woven sacks should be considered as articles of plastic, 7. In view of the above the Hon ble Court has concluded that HDPE strips or tapes fall under the Heading 39.20, sub heading 3920.32 of the Central Excise Tariff Act and not under Heading 54.06, sub heading 5406.90. Similarly the HDPE sacks fall under Heading 39.23, subheading 3923.90. 8. Hence following the above referred judicial pronouncement, the HDPE/LDPE/LLDPE Sacks 86 Bags, which is made out of plastics are classifiable under chapter 3923 and similarly, Sacks Bags, which is made out of manmade textiles materials are classifiable under chapter sub heading 6305. 5. RECORD OF PERSONAL HEARING: 5.1 The matter was posted for hearing on 27.11.2018 and Alok Barthwal, Counsel for the Applicant appeared on behalf of the Applicant. Reiterating the submissions already made in the application, he submitted that the Applicant has filed the Advance Ruling application for determining the cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are covered under chapter sub heading 5404 which describes the goods as : 5404 - Synthetic monofilament of 67 decitex or more and of which no cross-sectional dimension exceeds I mm; strip and the like (for example, artificial straw) of synthetic textile materials of an apparent width not exceeding 5 mm. 5.5 Further explanation to Note 1 (b) to Chapter 54 under Customs Tariff also states that - The terms man-made , synthetic and artificial shall have the same meaning when used in relation to textile materials. 5.6 The heading 54.04 of HSN also states that the heading covers : Strip and the like, of synthetic textile materials. - The Strip of this heading are flat, of a width not exceeding 5 mm. either produced as such by extrusion or cut from wider strips or from sheets. 5.7 The fabric manufactured from the above strips has also been classified under chapter sub heading 5407 as Woven fabrics of synthetic filament yarn, including woven fabrics obtained from materials of heading 5404. From the above it is thus absolutely clear that the strips of width less than 5mm and the woven fabrics manufactured therefrom are classifiable as text ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The Applicant s contention is also based upon the ruling given by the Advance Ruling Authority of west Bengal as reported in MEGA FLEX PLASTIC LTD. 2018 (15) GSTL 90 (AAR - GST) = 2018 (7) TMI 391 - AUTHORITY FOR ADVANCE RULINGS, WEST BENGAL . The relevant portion of the ruling which was in reference to LENO bags is as under : Para 14: Therefore to classify the product PP Leno Bags both the Explanatory Notes, as well as the clarifications in the Tariff and the specifications as per IS 16187:2014 should be taken into consideration. Para 16: The above-mentioned Tariff head is not applicable if the sacks made from PP woven fabric are impregnated, coated. covered or laminated with plastics or articles of plastics covered under Chapter 39 [Note 1 (h) to Section M]. 5.14 It is pertinent to mention that the erstwhile Central Excise Tariff is absolutely same to Customs Tariff. In the case of Sunpak 2016 (343) ELT 201 (Tri-Chennai) = 2016 (1) TMI 919 - CESTAT CHENNAI , the tribunal while deciding classification of goods under erstwhile Central Excise Tariff in respect of same goods held as under : Para 8. Heard both sides and perused the records. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. Certificate from Sasmira dated 01.03.2013. These certificates confirm that the fabrics manufactured by the appellants are warp knitted fabrics made out of synthetic yarn of width less than 5mm be classified under 6005. Further, the ISI standard notified by Bureau of Indian Standards for agro textiles shade nets for agriculture and horticulture and as per this standard the above textile fabrics are made from tapes of 1.7 mm width. And in the present case the width of the tape is of 1.5 mm and the goods manufactured by the appellants are classifiable as textile fabrics and articles of fabrics rightly classifiable under chapter heading 60059000 and the strips (HDPE) not exceeding 5mm is classifiable under 54049020. Accordingly, we set aside the impugned order to that extent and (i) all the three assessees appeals are allowed with consequential benefit. (ii) correspondingly, the revenue appeal is rejected. 5.15 Further in case of Flora Agrotech 2015 (319) ELT 333 (TRI - AHD) = 2014 (11) TMI 114 - CESTAT AHMEDABAD it was held as under : However, before discussing the technical opinion given by certain agencies it is relevant whether the CETA 1985, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MI 120 - MADHYA PRADESH HIGH COURT which was followed by Rajasthan High Court and CESTAT benches. It is an undisputed fact that the plastic strips used in making the Knitted Fabrics Shed Net is less than 5 mm width. As per Section Note 1(p) of Chapter 39 strip of plastic less than 5 mm in width is not classifiable under Chapter 39 of the CETA 1985. As per Section Note 1(g) of Section XI of the CETA 1985 strips or the like of plastic 5 mm less are classifiable in Section XI (Textile Textile Articles). By virtue of tariff description under Tariff Heading 54.04 of CETA 1985 plastic strip or the like upto 5 mm are required to be classified as man made filaments; strip and the like of man made textile materials. When there is a classification of man made textile materials of specified description given in the Central Excise Tariff Act 1985 itself then there is no need to look into any other statute for deciding the classification of the Knitted Fabric Shed Net which is thus made out of materials of CETH 54.04. 3. A specific entry in the CETA 1985 has to be the proper classification than a general entry in Chapter 39 of the CETA 1985, as per the Rules of interpretation t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Chapter 60 of the Central Excise Tariff Act 1985. The Applicant submits that in view of above interpretation of tariff and the order given by the authorities. the Applicant prays the Hon ble Advance Ruling Authority to give its ruling on classification of PP Bags/ Sacks and the applicable rate of GST. DISCUSSIONS AND FINDINGS: 6.1 We have carefully considered the submissions made by the applicant in the application as well as in the additional submissions. We have also taken into account the submissions made before us by representative of the applicant at the time of personal hearing. We are also seized of the departmental view submitted by the CGST Central Excise, Commissionerate, Indore. On the basis of records placed before us and the rival submissions, we proceed to decide the Application. 6.2 At the outset, we find that the question raised by the applicant falls under the provisions of Section of the CGST Act, 2017/ MPGST Act, 2017 as it relates to question regarding classification of goods. Thus we find the application fit to be heard and the same is thus admitted. 6.3 The moot question before us for decision is regarding classification of P.P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ary to place on record that the above mentioned order of the learned WBAAR has been struck down in appeal by the learned West Bengal Appellate Authority for Advance Ruling vide order dtd.25.10.2018 passed in Appeal Case No. 06/WBAAAR/Appeal/2018 = 2018 (11) TMI 663 - APPELLATE AUTHORITY FOR ADVANCE RULING, WEST BENGAL . The learned Appellate Authority has ordered that the item Polypropylene Leno Bags (PP Leno Bags) shall be classifiable under Tariff Heading 3923 29 90. So to the extent the Applicant have heavily relied upon the order of Learned WBAAR, we do not find any reason to discuss the same as it has been already set aside and reversed by the learned WB Appellate Authority for Advance Ruling. To say in other words, the very edifice of the arguments made in application has lost its existence. 6.7 Coming to the issue raised by applicant, we find that the issue of classification of PP/HDPE Bags or sacks, made of HDPE tapes and fabrics, has been dealt with at length by the Hon ble High Court of Madhya Pradesh in case of M/s. Raj Packwell Ltd. Vs. UoI [1990 (50) ELT 201 MP] = 1989 (9) TMI 120 - MADHYA PRADESH HIGH COURT . While deciding the identical issue, the Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d they, therefore, are goods of plastic and the material used for weaving those bags being the strips of plastic made from plastic granules, the strips of plastic used for weaving aforesaid HDPE woven sacks has to be classified as an item under entry 3920 of Chapter 39 and not under entry 5405 of Chapter 54. Accordingly, entries of finished goods have also to be made under proper Chapter of the Tariff Act treating them as the finished goods made of plastic strips. In the result we hold that HDPE strips or tapes fall under the Heading 3920, Sub-heading 3920.32 of the Central Excise Tariff Act and not under heading 5406, sub-heading 5406.90. Similarly HOPE Sacks fall into heading 3923, Sub-heading 3923.90.... 6.8 The above crystal clear decision of the Hon ble High Court of Madhya Pradesh leaves no doubt at all about classification of impugned goods i.e. HDPE woven bags/sacks. The above cited case is squarely applicable to the issue at hand. We also wish to emphatically mention here that the above said judgment having been passed by the High Court of Madhya Pradesh, is binding upon us as a matter of judicial discipline and we neither have any reason nor locus standi to di ..... X X X X Extracts X X X X X X X X Extracts X X X X
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