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TMI Blog2021 (9) TMI 1067X X X X Extracts X X X X X X X X Extracts X X X X ..... urther to the earlier, henceforth for the purposes of this Advance Ruling, the expression 'GST Act' would mean CGST Act and MGST Act. 2. FACTS AND CONTENTION - AS PER THE APPLICANT The submissions (verbatim) made by the applicant are as under:- "Annexure A (a) used/waste tyres is a waste and falls under chapter 4004. (b) Crumb rubber/granule less than 35 mm having mixture of rubbers mentioned in 4001, falls under 4002. Even if the granule/crumb is manufactured from waste /used tyres it is a finished product and not a waste. Supporting document (Letter MOEF) and therefore does not fall under 4004. (Annexure 1) (c) MOEF which is recognized agency to differentiate waste from finished product has clarified that powder/ granules which is generated as a by-product during manufacture of a product is a waste and hence should be classified as 4004. However, when some powder or granule is made as a main product by processing any waste rubber it is considered as finished product under 4002. (Annexure 2) (d) The GST applicable on rubber waste is 5% however GST applicable on crumb rubber/granule is 18% as it is a finished product. (Annexure 3) : (e) Chapter note of 4002 mentionin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . No. 5 15/2010-HSMD) Decision: The Committee noted the proposed import is for crumb rubber /granules of less than 35 mm size. Since rubber crumb / granules are made by processing of used tyre scrap and are thus. Products made from waste rubber, they have not been considered as waste under Schedule III of 11W Rules, 2016. Earlier also the committee had taken this view and stated that import of this material does not need permission front this Ministry. The applicant may be informed that the import of crumb rubber /granules does not need permission from this Ministry. 2.3.8 M/s. Balaji Udyog, Distt. Chum F. No. 5-33/2014-HSMD) Decision: In the report received from CPCB after site visit of the plant, it is noted that certain improvement has been suggested and the applicant is also required to take fire clearance. The application will be considered further after receipt of confirmation of compliance of the above issues. B. Statement containing the Applicant's interpretation of law and /or facts (a) Chapter 4004 is for waste/used rubber tyres and goods imported/traded under this chapter heading should be charged 5 % GST as GST on Rubber scrap is 5% (b) For products such as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mport is for crumb rubber/granules of less than 35 mm size. Since rubber crumb/granules are made by processing of used tyre scrap and are thus products made from waste rubber, they have not been considered as waste under Schedule III of HW Rules, 2016. Import of this material does not need permission from this Ministry". 5.2.3 First of all we observe that the MOEF issued the referred clarification in respect of a proposed import of crumb rubber/granules, on an application made by M/s Royal Carbon Black Private Limited, New Era Mills Compound, Mogul Lane, Mumbai 400016 and not the applicant. Further, it is clarified therein that, rubber crumb/granules are made by processing of used tyre scrap and are thus products made from waste rubber. It is nowhere insinuated, in the said referred clarification that, powder or granule made as a main product by processing any waste rubber is to be considered as finished product under HSN 4002. 5.3 Further, applicant has submitted an import bill/invoice dated 13.02.2020, in their own name which refers to 'Old and Used Tyre Scrap in baled form' which is shown to be classified under Chapter Heading 4004. The said product appears to have been import ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, under 'Scope of the Chapter' i.e. Chapter 40 is as under:- (a} Subject to Note 5, headings 40.01 and 40.02 essentially cover raw rubber in primary forms or in plates, sheets or strip. (c) Headings 40.03 and 40.04 cover reclaimed rubber in primary forms or in plates, sheets or strip, and waste, parings and scrap of rubber (other than hard rubber) and powders and granules obtained therefrom. 5.8.1 The applicant has submitted that the impugned product falls under HSN 4002. The said HSN 40.02 is as under:- 40.02 : Synthetic rubber and factice derived from oils, in primary forms or in plates, sheets or strip; mixtures of any product of heading 40.01 with any product of this heading, in primary forms or in plates, sheets or strip. 5.8.2 We find that the subject product cannot be called as synthetic rubber derived from oils, in primary forms or in plates, sheets or strip. The impugned product is in the form of granules which is different from plates, sheets or strip. Further the product 'factice', as per Note (2) to Heading 40.02, is the product of the reaction of certain vegetable or fish oils (whether or not oxidised or partly hydrogenated) with sulphur or sulphur chloride. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to Heading 40.04 states that "Goods of rubber (other than hard rubber) definitely not usable as such because of cutting-up, wear or other reasons" includes worn-out rubber tyres not suitable for retreading and scrap obtained from such worn-out rubber tyres. Also notes to Heading 40.04 also states that Powders and granules, obtained from such goods of such rubber (other than hard rubber) definitely not usable as such because of cutting-up, wear or other reasons" which includes worn-out rubber tyres, are covered under Heading 40.04. 5.10 We also reproduce Note 6 of Chapter 40 as under: "For the purpose of heading 4004, the expression "waste, parings and scrap" means rubber waste, parings and scrap from the manufacture and working of rubber and rubber goods defiantly not usable as such because of cutting up, wear or other reasons". 5.11 This applicant is producing crumb rubber/granules from used/waste tyres and has submitted during the course of the hearing that, the waste/used tyres are not usable because they are worn out tyres due to wear and tear. In view of the above discussions, we find that the used/ waste tyres, made of rubber are nothing but 'rubber and rubber goods no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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