TMI Blog2021 (7) TMI 538X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 as it does not include coir mattings / carpets with PVC or rubber backing - The Heading 5705 covers other carpets and other textile floor coverings whether or not made up and hence the product of the applicant does not fall under 5705 - On the basis of the descriptions of the headings and the relevant chapter notes the product of the applicant is appropriately classifiable under Tariff Sub-Heading 5703 90 90 of the Customs Tariff Act. Whether the product will attract GST at the rate of 5 % as per SI No. 219 of Schedule I or GST at the rate of 12 % as per SI No. 144 of Schedule II of N/N. 01/2017 Central Tax (Rate) dated 28.06.2017? - HELD THAT:- The entry at SI No. 219 of Schedule I of the notification refers to the coir mats, mattings, floor coverings etc that are exclusively made up of coir fibres. In the instant case though the exposed surface of the mats / mattings I floor coverings manufactured and supplied by the applicant are of coir it is backed by PVC I Rubber etc and the manufacturing process involves use of technologically advanced machines for providing the backing using PVC, Rubber Compound, Chemicals etc and the PVC / Rubber Compound and chemicals have equal im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such backed product, the application is filed for the clarification on the following query; Whether Mats, Mattings and Floor Covering of Coir , if backed by PVC, Rubber, Latex etc would fall under Tariff Headings 5702, 5703 and 5705 at SI. No.219 of Schedule - I of Notification No. 1/2017-CGST (Rate) dated 28.06.2017, within the 5% tax net, depending upon the respective manufacturing process of its exposed surface? 4. The applicant submitted that the entries in the GST schedule notified under Notification No.01/2017-Central Tax (Rate) dated 28.06.2017, is aligned with Customs Tariff / HSN. For the sake of reference, Explanation (iii) (iv) of the above Notification as amended is reproduced below; (iii) Tariff item , sub-heading heading and Chapter shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he nature of textile material used as surface when put in use and on the process of manufacturing. The material used as backing of the surface textile material has no relevance in the classification of the goods. 4.4. The above matter of classification was examined by the CBIC and by letter dated 20.05.2011 has clarified that the carpets and floor coverings whether or not backed by vinyl / latex / rubber are classifiable under respective headings of Chapter 57 depending upon the process of manufacture and the type of textile materials used. It was also clarified that in case of coir mats the essential characteristic is of coir and such goods are sold as coir mats only irrespective of the backing. An identical view has been taken by the Kerala AIT and ST Appellate Tribunal in its order dated 31.01.2002 in Appeal NO. TA 478/1996 wherein it was found that the crystals of coir fixed at the bottom of a sheet of PVC compound and which appears like coir mat being used as floor mat made up of coir fibre has to be treated as a coir product for the purpose of exemption from sales tax available for coir products. 4.5. The Coir Board in its clarification dated 12.04.2016 had clarified t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by PVC, rubber, latex etc cannot be considered as textile of coir and floor coverings covered under HSN 5702, 5703 or 5705 and taxable at the rate of 5%. 6. PERSONAL HEARING: The applicant was granted opportunity for personal hearing on 22.12.2020. Shri. M.Balagopal, Advocate represented the applicant in the personal hearing. He reiterated the contentions made in the application and also produced the sample of the product before the authority and requested to issue the ruling on the basis of the submissions made by them. 7. DISCUSSION AND CONCLUSION: 7.1. The matter was examined in detail. The issue to be decided is the classification and rate of goods and services tax of Mats, Mattings and Floor Covering of Coir backed by PVC, Rubber, Latex etc manufactured by the applicant. 7.2. Carpets and other textile floor coverings fall under Chapter 57 of the Customs Tariff Act. Note 1 to Chapter 57 reads as follows; For the purposes of this Chapter, the term carpets and other textile floor coverings means floor coverings in which textile materials serve as the exposed surface of the article when in use and includes articles having the characteristics of textile ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is rightly classifiable under Customs Tariff Sub - Heading 5703 90 90 the question that is to be answered is whether the product will attract GST at the rate of 5 % as per SI No. 219 of Schedule I or GST at the rate of 12 % as per SI No. 144 of Schedule II of Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017. SI No: 219 of Schedule I of Notification No: 01/2017 CT (Rate) dated 28.06.2017 reads as follows; 219 - 5702, 5703, 5705 - Coir mats, matting, floor covering and handloom durries. SI No. 144 of Schedule II of Notification No. 01/2017 CT (Rate) dated 28.06.2017 reads as follows; 144 5703 Carpets and other textile floor coverings, tufted, whether or not made up. On a combined reading of both the entries it is evident that the entry at SI No. 219 of Schedule I of the notification refers to the coir mats, mattings, floor coverings etc that are exclusively made up of coir fibres. In the instant case though the exposed surface of the mats / mattings I floor coverings manufactured and supplied by the applicant are of coir it is bac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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