TMI Blog2022 (2) TMI 992X X X X Extracts X X X X X X X X Extracts X X X X ..... The main raw material of Gypsum Plaster board is Gypsum (more than 90%), which is mainly procured from mines and other raw material is paper and additives, whereas, the Glass Fibre Reinforced Gypsum Board is made-up of Phosphogypsum (more than 90%), which is a by product of phosphoric acid plant. Other raw material i.e. Glass fibre and additives is also used in the manufacturing of GRG Board - the raw materials which is used in gypsum board and GRG board are different. The applicant submitted that the proposed new variant of Gypsum Board is made-up of Gypsum, glass fibre and additives, the main raw material is Gypsum which is procured from the mines, whereas, GRG board is made up of Phosphogypsum, which is a by product of phosphoric acid plant therefore, the proposed new variant of Gypsum board to be manufactured by the applicant cannot be called as Glass-fibre Reinforced Gypsum Board (GRG) and cannot be classified in Serial No. 92 of Schedule II of Notification No. 1/2017- Central Tax (Rate) dated 28 June 2017 which provides specific rates for GRG board. Since, the intended product cannot be treated as GRG Board, the second question raised in respect of BIS Standard IS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivities based in the state of Rajasthan. Further, the Applicant has trading warehouses situated in ten states across India. 3. The Applicant is also engaged in import and sale of goods, wherein it imports goods from its overseas parent Company and supplies in domestic market through its trading warehouses. 4. One of the major product being dealt in by the Applicant is paper reinforced gypsum board, which is classifiable under tariff item 6809 11 00 and is subject to GST at the rate of 18%. 5. The Applicant is contemplating to commence production of a new variant of gypsum board and wishes to understand whether the same could be classified as GRG board classifiable under tariff item 6809 19 00 but attract lower rate of GST under Notification No. 1/2017-Central Tax (Rate) dated 28 June 2017. Accordingly, the Applicant is submitting herewith an application requesting advance ruling with respect to said classification. 6. The specifications of new variant of gypsum board proposed to be manufactured are as follows:- The board would have a composition of gypsum plaster and glass fibre forming rectangular/ square structure of regular dimensions with the following level ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Tax (Rate) dated 28 June 2017, rate of GST on articles of plaster such as Boards covered under Chapter Heading 6809 is as follows: Chapter/ Heading/ Subheading/ Tariff item Description of goods Rate 6809 Articles of plaster or of compositions based on plaster; such as Boards, sheets, panels, tiles and similar articles, not ornamented 18% Therefore, all kind of plaster boards made up- of gypsum are covered under the aforesaid Tariff Heading. However, Serial No. 92 of Schedule II of Notification No. 1/2017-Central Tax (Rate) dated 28 June 2017 provides specific rates for GRG board. The same has been reproduced below; Further, an explanation (iii) to the said notification provides that 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). Also, explanation (iv) of the said notification provides that the rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the products bearing these standards meet a minimum level of quality in terms of durability, safe usage and like factors. Therefore, these standards are a benchmark of quality but not the definition of tin product itself. It is pertinent to note that Bureau of Indian Standards (BIS) has notified IS-2095 in three parts wherein specifications of GRG boards are discussed in detail in Part 3. Part 3 of IS 2095 has defined properties of GRG board in terms of material composition, method of manufacturing along with shapes of dimensions of GRG hoard. Furthermore. IS-2005 has specified tests like flexural strength test, moisture test etc. which are required to be satisfied by GRG board. Now the question arises as to whether properties and tests specified by IS 2095 are mandatorily required to be satisfied in order to qualify as GRG board under the Notification no. 1/2017- Central Tax (Rate) dated 28 June 2017 when notification does not refer to the IS-2095. This issue was analysed by the Customs Excise and Service Tax Appellate Tribunal (CESTAT) in Vikash Trading Company vs Comm, of Customs, Chennai [2019 (365) ELT 584 (Tri-Chennai)] and held that in absence of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ile interpreting the provisions of a fiscal legislation should neither add nor subtract a word from the provisions of instant meaning of the sections. - In the case of Rakesh Kohli [(2012) 6 SCC 312], the principle was adopted that as long as there is no ambiguity in the statutory language, any interpretative process to the legislative intent becomes impermissible. Applying the ratio of 'literal interpretation' in the instant case that the entry 92 to schedule II of GST Notification should be interpreted unconditionally i.e. in absence of requirement to meet any requirements of IS-2095 and reference should not be made to Part -3 of IS - 2095 to interpret the term GRG board. Accordingly, the term GRG board should be interpreted in its literal sense i.e. a gypsum board which has been reinforced with glass fibres by any method of engineering. A4. Rules of classification and relevant judicial pronouncements The foremost attention is provided to the 'statutory definition' for the purpose of classification of goods. In the absence of any statutory' definition, and any guideline provided by the explanatory notes, the cardinal principle wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to be. The underlying principle behind usage of common parlance test is to understand a common man perception of the product. It is the common man who spreads the interpretation of terms used in law across the entire horizon i.e. from an urban area to a rural area and from being a literate person to be an illiterate person. It's this basic understanding of the goods which the legislature uses for the purpose of classification of goods for the purpose of levy of tax. A similar view can be applied in the interpretation of the term GRG board' where a common man perceives it as a gypsum board with reinforcement of either glass fibre without going into technical meaning or the properties of the product. The Hon'ble Apex Court in case of Porritts Spencer (Asia) Ltd. A vs State of Haryana [1979 AIR 300, 1979 SCR (1) 545] summarized the situation as where a word has a scientific or technical meaning and also an ordinary meaning according to common parlance, it is in the latter sense that in a taxing statute the word must be held to have been used, unless contrary intention is clearly expressed by the Legislature . The judgement of the Hon'bl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at Room no. 2.11 NCRB, Statue Circle, Jaipur. Shri Yogesh Gupta C.A. (Authorised Representative) alongwith Shri Vishal Dang (Accounts manager) of applicant appeared for PH. During the PH, they reiterated the submissions already made in the written application. They also made additional submission during the PH, which is related to case laws. 4. COMMENTS OF THE JURISDICTIONAL OFFICER The jurisdictional officer (Deputy Commissioner, Circle-II, SGST, Bhiwadi, Alwar, Rajasthan) has submitted his comments vide their letter which can be summarized ........................................................................................ ........................................................................................ ........................................................................................ 5. FINDINGS, ANALYSIS CONCLUSION: We have considered the submissions made by the applicant in their application for advance ruling as well as the arguments/discussions made by their representative Shri Yogesh Gupta at the time of personal hearing. We have also considered the issues involved on which Advance Ruling is sought by the applicant. Based o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), and plaster fracture splints (heading 90.21). (b) Panels, etc., agglomerated with plaster, of heading 68.06 or 68.08. (c) Anatomical models, models of crystals, geometric models, relief maps and other models, designed solely for demonstrational purposes, of heading 90.23. (d) Tailor's dummies, etc. (heading 96.18). (e) Original sculptures and statuary (heading 97.03). As per the SL No 74 of the Schedule IV Notification No. 1/ 2017-Central Tax (Rate) dated 28 June 2017, rate of GST on articles of plaster such as Boards covered under Chapter Heading 6809 is as follows: Chapter / Heading/ Subheading/ Tariff item Description of goods Rate 6809 Articles of plaster or of compositions based on plaster; such as Boards, sheets, panels, tiles and similar articles, not ornamented 18% 2. Therefore, all kind of plaster boards made up of gypsum are covered under the aforesaid Tariff Heading. 3. However, Serial No. 92 of Schedule II of Notification No. 1/ 2017- Central Tax (Rate) dated 28 June 2017 provides specific rates for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd glass roving for three tables. The chemicals are added in water mixed and then plaster is added mixed to form slurry. One layer of slurry is laid on the table by the crab followed by a layer of glass roving. This glass roving is embedded in to the slurry with the help of screen roller. Another layer of slurry is poured followed by a layer of glass roving this layer is pushed inside the ribs with the help of temping bar. Finally, a layer of glass roving is laid for the top face of the wall panel. After getting final Gilmore wall panel is lifted from the casting table to ACROBA frame and shifted to dryer for drying. The wall panel is dried at a temperature of 275 degrees Centigrade for 60 minutes. From the above, it is clear that the raw materials which is used in gypsum board and GRG board are different. 5. We find that the applicant has submitted the technical specification with respect to contents of the impugned product. The applicant submitted that the proposed new variant of Gypsum Board is made-up of Gypsum, glass fibre and additives, the main raw material is Gypsum which is procured from the mines, whereas, GRG board is made up of Phosphogypsum, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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