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TMI Blog2021 (9) TMI 1288X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 2017' respectively), 'Slide Fasteners and parts thereof' falling under Chapter Heading 9607 of the CTA, 1975 were covered under Sl. No. 446 of Schedule - III of the said Notifications and were attracting GST of 18% (9% CGST + 9% SGST). However, in terms of Notification No. 18/2018-Central Tax (Rate) dated 26.07.2018, Notification No. 1/2017-Central Tax (Rate) was amended whereby 'Slide Fasteners' falling under Chapter Heading 9607 of the CTA, 1975 were covered under Sl. No. 231B of Schedule - II of the said Notifications attracting the GST of 12% (6% CGST + 6% SGST) whereas Sl. No. 446 of Schedule - III of the said Notifications covered 'Parts of slide fasteners' falling under Tariff Item 9607 20 00 attracting GST of 18% (9% CGST + 9% SGST). 2.2 The appellant filed an application for Advance Ruling before the Gujarat Authority for Advance Ruling (herein after referred to as the 'GAAR'), wherein details of products manufactured and supplied by the appellant, classification of those products as well as rate of GST applicable on those product, in the understanding of the appellant, were described as follows :- (i) Zip Rolls This product is supplied in continuous length as pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufactured on power looms from polyester yarn. (ii) A strip of polyester cord along with teeth (scoop) is manufactured on the cording machine from polyester monofilament yarn. (iii) The polyester tape and polyester cord with teeth are stitched together on the stitching machine with one inner edge of each being fitted with scoops of plastics. (iv) The two narrow strips of textile materials with one inner edge fitted with scoops of plastics are interlocked on the machine to form the 'zipper rolls'. Such 'zipper rolls' can be made to interlocked or opened by means of a slider. (v) The 'zipper rolls' are subjected to a process of calendaring and dyeing. (vi) The 'zipper rolls' are cleared in continuous length. 4.2 The appellant has submitted that in the garment industry, since the size of the zipper is fixed, the zippers are generally purchased by buyers in cut length along with slider. However, in case of bag manufacturers, since the size of the zipper is not fixed, they purchase 'Zipper Rolls' which are cut by them in required lengths and then slider is affixed by them. Both the ends of the 'Zipper Rolls' are fixed in the baggage, the slider is inserted in the 'Zipper Ro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the judgement of the Hon'ble Supreme Court in the case of Reckitt Benckiser (India) Ltd. Vs. Commissioner, Commercial Taxes [(2015) 7 SCC 126]. 4.6 The appellant has referred to the Explanatory Notes to HSN Heading 9607 and has submitted that 'Slide Fastener' is described to consist of two narrow strips of textile material fitted with chain scoops on each edge and which can be made to interlocked by a slider. It has further been submitted that the slider is required only to operate the slide fastener and it is not as if there is no slide fastener without slider. In so far as the 'Zipper Rolls' of the appellant are concerned, they are not only consisting of two strips of textile material with one edge of each strip being fitted with scoops, they are further also interlocked by a machine. The appellant has submitted that the only reason why they are not cut into 'Zippers' and fitted with sliders is that they are meant for buyers who do not use 'Zippers' of fixed lengths and therefore the 'Zipper Rolls' can be cut by them into required lengths and then fitted with sliders. 4.6 The appellant has submitted that despite the fact that the 'Zipper Rolls' are supplied in continuous leng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other [(2008) 5 SCC 680] and Commissioner of Income Tax Vs. Kullu Valley Transport Co. Pvt. Ltd. [AIR 1970 SC 1734]. 4.10. The appellant has requested to hold that 'Zipper Rolls' are classifiable under Entry 231B pertaining to 'Slide Fasteners' for the period from 27.07.2018 to 30.09.2019 and therefore taxable at the rate of 6% CGST + 6% SGST. 5. The appellant has submitted copy of first page of ER-1 Return for June, 2017 wherein Central Excise Tariff Sub-Heading 9607 11 10 has been shown for the product 'Zipper Roll'. FINDINGS :- 6. We have considered the submissions made by the appellant in the appeal filed and at the time of personal hearing as well as evidences available on record. We have also gone through the Ruling given by the GAAR. 7. The Advance Ruling was sought for by the appellant for appropriate classification and applicable rate of Goods and Services Tax for the products (i) 'Zip Rolls'; (ii) 'Finished Zipper'; and (iii) 'Sliders'. The appellant has not challenged the Advance Ruling given in respect of the products 'Finished Zipper' and 'Sliders'. 8. Therefore, the issue involved in this case is limited to the proper classification of the product 'Zip Roll' and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edge designed to interlock one with the other under the action of a slider. (2) Parts of slide fasteners, e.g., chain scoops, sliders or runners, end pieces, and narrow strips of any length mounted with chain scoops. 9.5 It is apparent that Chapter Heading 9607 at sub-heading level (at 6 digit level) is same in the CTA, 1975 and in Harmonised System of Nomenclature, though the sub-headings have further been divided in the CTA, 1975. Therefore, the Explanatory Notes can be relied to determine proper classification of the product under Chapter Heading 9607. Hon'ble Supreme Court in the case of L.M.L. Ltd. Vs. Commissioner of Customs [Civil Appeal No. 3764 of 2003, decided on 21.09.2010 reported at 2010 (258) ELT 321 (S.C.)] has held that there can be no doubt that the HSN Explanatory Notes are a dependable guide while interpreting the Customs Tariff. 10.1 The appellant has described the manufacturing process of the 'Zip Roll', which has been reproduced at Para 4.1 above. 10.2 In the Explanatory Notes, 'Slide Fasteners' have been described. It has been mentioned that most slide fasteners consist of two narrow strips of textile material one edge of each strip being fitted with sco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant has relied upon the judgement of the Hon'ble High Court of Madras in case of Commissioner of Customs Vs. Hides [2009 (238) E.L.T. 398 (Mad.)] in support of the contention that 'Zip Rolls' supplied in continuous length without a slider completely fit into the description of 'Slide Fasteners'. 12.2 We have gone through the aforesaid judgement of the Hon'ble High Court of Madras. In the said judgement, the Hon'ble High Court of Madras has held as follows - "7. Sl. No. 294 of the Notification after referring the tariff Heading 56.01, 96.06 or 96.07, describe the goods which are exempted from payment of customs duty as "Fasteners and poly wadding materials". Thus, as could be seen from the Notification, any fastener and poly wadding materials, which comes under the tariff Headings 56.01, 96.06, 96.07, are totally exempted from payment of customs duty. The Notification does not require the fastener should have a slider or scoop either metal or plastic as contended by the learned counsel for the department. If the intention of the department is that the exemption has to be granted only for fasteners with scoops or fasteners with the slider, in the exemption notification itsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We have perused the copy of first page of ER-1 Return for the month of June, 2017 submitted by the appellant wherein Central Excise Tariff Sub-Heading 9607 11 10 has been shown by the appellant for the product 'Zipper Roll'. However, we note that the assessees under Central Excise regime were required to determine the classification of the product and pay Central Excise Duty on self assessment basis. Such self determination of classification of any product and declaration by the assessee of such classification in Central Excise Invoices and Monthly Returns cannot be the basis for determination of correct classification of the product in the present proceedings before this authority. 14.1 The appellant has submitted that the 'Zip Rolls' have the essential character of the 'Zipper' and hence even by applying Rule 2(a) of the General Rules of Interpretation, the 'Zip Rolls' would be classifiable under the entry for 'Slide Fasteners'. 14.2 As per Rule 2(a) of the General Rules for the Interpretation of the CTA, 1975, "any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as presented, the incomplete or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'Zippers' are as such the same commodity and therefore warrant the same classification under the entry of 'Slide Fasteners'. 15.2 We have gone through the judgements relied upon by the appellant. In the case of S.R. Tissues Pvt. Ltd. [2005 (186) E.L.T. 385 (S.C.)], Hon'ble Supreme Court held that the process of slitting / cutting of jumbo roll of plain tissue paper / aluminium foil into smaller size will not amount to "manufacture" under Section 2(f) of the Central Excise Act, 1944. "Whether is there any manufacture when Tarpaulin sheets are stitched and eyelets are made?" was the issue involved in the case of Tarpaulin International [2010 (256) E.L.T. 481 (S.C.)]. Again, the issue involved in the case of Tega India Ltd. [2004 (164) E.L.T. 390 (S.C.)] was whether fixing rubber linings on pipes, tanks and other such articles amounting to manufacturing dutiable goods ? Thus, all these judgements were pertaining to the issue whether some particular process amounted to manufacture in the context of section 2(f) of the Central Excise Act, 1944 and hence liable to Central Excise Duty. The issue of classification of product, and particularly, classification of 'Zip Rolls', was not the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.07.2018 to 30.09.2019 was "slide fasteners", unlike the description of goods "Fasteners and poly wadding materials" in the Notification issued under the Customs Act, 1962. Therefore, the judgement of Hon'ble High Court of Madras in the case of Commissioner of Customs Vs. Hides (supra) is not applicable in this case. On the contrary, the observations of the Hon'ble High Court of Madras in the case of Commissioner of Customs Vs. Hides (supra) supports the view that 'Zip Rolls' would not be covered under Sr. No. 231B of Schedule - II of the Notifications during 26.07.2018 to 30.09.2019 as the 'description of goods' mentioned against the said entry was 'Slide fasteners'. 20.1 The appellant has submitted that if two views are possible in taxing statutes then the view in favour of the assessee should be adopted and has cited judgements in support of this contention. 20.2 However, as discussed in foregoing paras, the classification of the product 'Zip Rolls' and applicable rate of Goods and Services Tax for the said product is quite clear. Therefore, we do not propose to delve further on this aspect. 21.1 In view of foregoing, we confirm the Advance Ruling No. GUJ/GAAR/R/39/2020 date ..... X X X X Extracts X X X X X X X X Extracts X X X X
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