TMI Blog2020 (4) TMI 635X X X X Extracts X X X X X X X X Extracts X X X X ..... tion No. 01/2017- Central Tax (Rate), dated 28.06.2017. In the present case, Bagasse based Particle Board to be manufactured by the applicant is a composition of bagasse wood particles and not only of bagasse, therefore, same would be covered under entry at Sr. No. 137A in Schedule III to the Notification No. 01/2017- Central Tax (Rate), dated 28.06.2017 and attracts GST rate of 18%. - GUJ/GAAR/R/2019/ 23 IN APPLICATION NO. Advance Ruling/SGST&CGST/2018/AR/21 - - - Dated:- 25-9-2019 - R.B. MANKODI AND G.C. JAIN MEMBER Present for the applicant: Shri Anish Goyal 2. The Applicant, vide Annexure A attached with Form GST ARA-01 dated 19.04.2018, mentioned their queries as under: QUERRY Whether Bagasse based Particle Board manufactured with a composition of 75% of bagasse, 25% of wood particles and 5 kgs. of resins falls under serial No.92 of Schedule II [GST rate 12%) or under Sr. No. 137A of Schedule III (GST rate 18%) of the Notification No. 01/2017-Integrated Tax [Rate] dated 28.06.2017? 2.1 The Applicant, vide attached sheet Annexure B to their application dated 06.04.2018, has submitted the Statement of relevant facts having a bearing on the qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts, as the case may be, in respect of the aforesaid question (i.e. applicant s view point and submissions on issues on which the advance ruling is sought is as follows: (a) Particleboard is a composite panel product consisting of cellulosic particles of various sizes that are bonded together with a synthetic resin or binder under heat and pressure. Particle geometry, resin levels, board density and manufacturing processes may be modified to produce products suitable for specific end uses. (b) Particle boards falling under Heading 4410 of the Customs Tariff Act are a flat product board manufactured in various lengths, widths and thicknesses by pressing or extrusion, and it is usually made from wood chips or particles obtained by the mechanical reduction of round-wood or wood residues, and also from other ligneous materials such as fragments obtained from Bagasse, bamboo, cereal straw, or from flax or hamp shives. (c) Thus, the particle boards can be obtained from particles of various items such as wood particles, bamboo, bagasse etc., however, each of the product is different based on its characteristics like density, strength, flexibility, thickness, Swelling, Wat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reproduced for ready reference: 3. When for any reason, goods are prima facie, classifiable under two or more Headings, classification shall be effected as follows:- (a) The Heading which provides the most specific description shall be preferred to Heading providing a more general description. (b) Mixtures and composite goods which consist of different materials or are made up of different components and which cannot be classified by reference to (a) shall be classified as if they consisted of the material or component which gives the goods their essential character, in so far as this criterion is applicable. (c) . (j) As per the rule 3(a) of classification rules, the specific entry shall prevail over the general entry. Based on interpretation of rule (3)(a), GST rate applicable on bagasse board is 12% as the same is specifically covered under S.No.92 whereas S.No.l37A covers all type of particleboard that is a general description. Further, as per Rule 3(b) of the classification rules, in case of mixture/composite goods consisting of different materials or made up of different components the goods shall be classified as if they consisted of the materia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g wholly or partly of such material or substance. 3. When any application of sub-rule (b) of Rule 2 or for any other reason, goods are prima facie, classifiable under two or more headings, classification shall be effected as follows: (a) ** ** ** ** ** (b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets, which cannot be classified by reference to (a), shall be classified as if they consisted of the material or component which gives them their essential character, in so far as this criterion is applicable. 48. The Rule 3(b) enacts what may be termed as the predominant principle of classification. That is to say an excisable item must be understood with reference to the predominant element in its make-up. 49. The respondents have strongly urged that these Rules are limited to interpretation of the Schedule and cannot serve as guidelines to interpret a notification. The submission is unacceptable. 50. In my view, it is immaterial whether the words in question are used in the Act or in the notification issued under the Act. The notification being issued in exercise of statutory power under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. Following the said judgment, in the present case also the plastic being predominant in the product, Missile Container, it merits classification under Chapter 39, in view of above discussion and settled legal position of law, the order passed by the Id. Commissioner (Appeals) is just and proper which reeds no interference we, therefore, uphold the impugned order and dismiss the appeal. (III) In case of INNOVISION FOODS PVT. LTD. Versus COMMISSIONER OF C. EX., BANGALORE-I 2017 (348) E.L.T. 591 (Tri. - Bang.) = 2017 (2) TMI 669 - CESTAT BANGALORE : 5.1 In terms of Rule 2(b) classification of goods consisting of more than one material or substance shall be in accordance with the principles contained in Rule 3. Rule 3(b) concerns with mixtures and composite goods consisting of different materials and reads as follows: mixtures, composite goods consisting of different materials or made up of different components, and goods put up in the sets for retail sale, which cannot be classified by reference to (a) shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable . 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , wafer board) of wood or other ligneous materials, whether or not agglomerated with resins or other organic binding substances, other than specified boards 137B 4411 Fibre board of wood or other ligneous materials, whether or not bonded with resins or other organic substances, other than specified boards 137C 4412 Plywood, veneered panels and similar laminated wood 137D 4413 Densified wood, in blocks, plates, strips, or profile shapes 137E 4414 Wooden frames for paintings, photographs, mirrors or similar objects 137F 4418 Builders joinery and carpentry of wood, including cellular wood panels, assembled flooring panels, shingles and shakes 137G 4421 Wood paving blocks, articles of densified wood not elsewhere included or specified, Parts of domestic decorative articles used as tableware and kitchenware ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4410 Particle Board, Oriented Strand Board and similar board (for example, wafer board) of wood or other ligneous materials, whether or not agglomerated with resins or other organic binding substances, other than specified boards. 9. We find that Bagasse based Particle Board to be manufactured by the applicant is a composition of bagasse wood particles and not only of bagasse, therefore, same would be covered under entry at Sr. No. 137A in Schedule III to the Notification No. 01/2017- Central Tax (Rate), dated 28.06.2017 and attracts GST rate of 18%. 10. In view of the foregoing, we rule as under R U L I N G Question : Whether Bagasse based Particle Board manufactured with a composition of 75% of bagasse, 25% of wood particles and 5 kgs of resins falls under serial No.92 of Schedule II [GST rate 12%) or under Sr. No. 137A of Schedule III (GST rate 18%) of the Notification No. 01/2017 - Integrated Tax [Rate] dated 28.06.2017? Answer : Bagasse based Particle Board, which is a composition of 75% of bagasse, 25% of wood particles and 5 kgs of resins, will fall under entry at Sr. No. 137A in Schedule III to the Not ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
