TMI Blog2021 (8) TMI 734X X X X Extracts X X X X X X X X Extracts X X X X ..... entary evidence like tenders for proposed supply of such goods, etc, though the applicant's entity at Karnataka and Rajasthan have undertaken supplies of such goods. Further, the applicant did not dispute the fact that the products for which classification is sought is custom made as per the required specifications of the recipient/buyer. It is seen that special purpose motor vehicles are specially constructed or adapted and equipped with certain devices to enable them to perform the functions. Thus it is clear that such vehicles will be custom made for which purchase orders with the specification of the goods are necessary. To classify a product, the complete nature of the product and features of the product should be known - Here the products are not manufactured by the applicant as reported by the Jurisdictional Authority and no purchase orders/tenders for such supply have been produced by the applicant. As per Section 95 of the GST Act, Advance Ruling can be sought in respect of the proposed supplies. In the case at hand, the ruling sought on the classification of the product, can be decided only based on the nature, features, intended purposes. It is pertinent to not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Applicant has stated that they are engaged in manufacture and sale of commercial motor vehicles such as buses, trucks, light vehicles and parts thereof. In addition to the above, they also manufacture and sell various special purpose vehicles such as road sweeper truck, suction-cum-jetting machine, hook loader/garbage tipper and refuse/garbage compactor vehicle. They have stated that the Garbage Compactor is a solid waste collection and compaction vehicle specially designed to make the task of garbage collection efficient and effective. They have furnished sample photographs of the Garbage Compactor manufactured by them. The vehicle is designed with rear loading device to load the garbage/refuse onto the vehicle from the garbage bins located across the city. The Garbage Compactor manufactured by them is offered with different container volume which is mounted on a standard truck chassis having gross vehicle weight of 11,000 Kg, 19,000 Kg and 28,000 Kg. 2.2 The Garbage Compactor vehicle manufactured by them has three main components namely - (1) A trash container; (2) A motor; and (3) flat steel press. The Applicant has submitted that once the garbage is collecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted to the dumping yards and then is unloaded with the automatic hydraulic mechanism; that the key benefits are that the Tipper is a compact vehicle which is effective in door to door collection of the garbage; the closed tipper eliminates spilling of waste on the roads; that the automated hydraulic system makes the unloading simpler with minimum human intervention. 2.5 The applicant on their interpretation of law has stated that their products i.e. Garbage Compactor Vehicle and hook loader viz. manufactured and supplied by them is classifiable under Chapter Heading 8705 (Special purpose vehicles, other than those principally designed for the transport of persons or goods) which attracts GST at 18% in terms of Sl.No.401A of Schedule III of the IGST rate notification. The applicant has stated that on perusal of the Sl.No.401 A of the above notification it is evident that the same covers Chapter Heading 8705 of First Schedule of the Customs Tariff Act, 1975. The said chapter Heading covers within its scope a Special Purpose Motor Vehicle. However, the said chapter heading explicitly excludes those motor vehicles which are principally designed for transport of persons or goods. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, the garbage does not have an inherent marketable characteristic of its own. In view of the above facts, the applicant is of the understanding that Garbage Compactor Vehicle supplied is not for transportation of goods, hence it is not classifiable under Chapter Heading 8704. In order to substantiate their contention the applicant has placed reliance on the following case laws: Maniar Co. v. CCE [2000 (119) E.L.T. 418 (Tribunal)] CCE v Kailash Auto [2010 (257) E.L.T. 582 (Tri - Mumbai)] 2.8 Further, in order to examine whether the garbage compactor/Hook Loader Vehicle is a special purpose motor vehicle, the applicant has submitted that the garbage compactor and hook loader vehicle is supplied as part of the complete solution towards the clean Indian Mission of Swach Bharat Abhiyan'. The garbage/refuse compactor is specifically designed for the collection, compaction, transportation and unloading of garbage/refuse. The vehicle has been designed with rear loading device to load the garbage/refuse onto the vehicle from the garbage containers located across the city through an automated system. The same automated system for loading of garbage is a distinct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llect and transfer garbage and garbage is not goods. The Authorised representative furnished a paper book containing the Statutory Provisions, Case Laws and the Synopsis by email which was taken on record. They were asked to furnish sample invoice in respect of their products both in GST regime and Pre-GST regime along with copies of invoices of their competitors. The Authorised representative agreed to furnish the copies and stated no further hearing is required on their part but if required by the authority they are willing to participate. 3.2 In furtherance to the PH held on 19.02.2021, the applicant made Written submission- emphasizing the applicability of the case laws relied upon in their earlier submissions and also furnished detailed write up on the products Garbage Compactor Vehicle, garbage tipper, the applicants understanding, reasoning for classifying their products as special purpose vehicles which is extracted below: The Garbage Compactor and Book Loader are special purpose motor vehicles 20. The reasoning for the same is stated below: - Vehicle Special features Garbage Compactor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wet garbage: - The Closed Garbage Tipper comes with separate compartments for dry and wet garbage. However applicant did not furnish copies of sample invoices called for and a letter to that effect was issued on 19.03.2021. In response to the letter, applicant submitted that under the erstwhile regime, there was no clearance of the Garbage compactor and the Tipper and 3 sample invoices of GST issued by their Alwar unit, Rajasthan were submitted. The Administrative Jurisdictional authority of the applicant, i.e, Chennai South Commissionerate, CGST was asked to conduct verification on the factual position and report. In reply, jurisdictional authority reported that the applicant has not carried on manufacture of these vehicles in the pre-GST regime and that they have not received any orders so far; that these vehicles are custom made. 3.3 Further to the verification report of the central jurisdictional authority, a notice dt.06.05.2021 was issued to the applicant extending another personal hearing to decide on whether the application may be rejected in as much as the applicant presently does not undertake or propose to undertake manufacture of the said vehicl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or goods) attracting IGST at 18% in terms of SI.No.401A of Schedule III of Notification No.01/2017 Integrated Tax (Rate) dated 28.06.2017 and CGST and SGST at the rate of 9% respectively in terms of the corresponding rate notification? 7.1 The applicant has stated that they are proposing to manufacture Garbage compactor and hook loader and have applied for ruling as to whether the vehicles would merit classification under Customs Tariff Heading (CTH) 8705 or under CTH 8704. They contend that these vehicles are classifiable under CTH 8705 as Special purpose motor vehicles, other than those principally designed for the transport of persons or goods and it attracts GST @18% in terms of Sl.No.401A of III Schedule of the Notification No.01/2017-Integrated Tax (Rate) dt. 28.06.2017 and CGST and SGST at the rate of 9% respectively. Applicants were required to submit samples of invoices, Purchase orders etc pertaining to both pre GST and GST regime to ascertain the nature of the products manufactured and supplied. In response vide submissions dt. 13.04.2021, the applicant submitted that there were no clearances of these products during pre-GST regime. They had submitted copies of invo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supply of goods or services or both being undertaken or proposed to be undertaken by the Applicant. They have also relied on the Flyer at Chapter 37 issued by CBIC wherein it has been stated that an Advance Ruling helps the applicant in planning his activities, which are liable for payment of GST, well in advance; that the flyer also states that the definition of Advance Ruling given under the Act is a broad one and an improvement over the existing systems of Advance ruling under the Customs and Central Excise laws. They stated that based on these points, their application seeking appropriate classification and rate of GST payable on refuse/garbage compactor and hook loader/garbage tipper proposed to be supplied is not liable to be rejected. 8.2 From their submissions, it is observed that so far in GST Regime, clearances have been effected by their Rajasthan and Karnataka units only and the applicant unit at Chennai has not received any orders for such supply presently. Though the applicant has stated that they intend to receive order for future supply, the applicant has not established this claim of theirs through any documentary evidence like tenders for proposed supply of su ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
