2019 (3) TMI 1847 - AAR - GST

Classification of goods - rate of tax - U-Bolt, Screws Bolts and Nuts, Spring Pins and Bushes manufactured and supplied by the Applicant - whether the items U-Bolt, Centre Bolt spring pins manufactured by the applicant are covered under Chapter 73 or Chapter 87? - whether the item bush is covered under Chapter 84 or Chapter 87? - HELD THAT - The Centre Bolt in question fulfills the description as given the HSN explanatory note. The Centre Bolt is threaded and is designed to engage with a nut. Accordingly, as the Centre Bolt fulfills the description of a bolt under CTH 7318 and is made of steel, it is also classifiable under CTH 7318 - the articles falling under heading 7318 do not fall under the expression parts and parts and accessories of motor vehicles. Accordingly, the articles falling under 7318 will be covered exclusively under this category for tariff purpose. Spring Pins - HELD THAT - Spring Pins are specifically covered under tariff item 73209020. Spring Pins manufactured and supplied by the Applicant are made up of various types of steel. Further, Spring Pin is in the nature of a spring and hence provided under the sub-heading Other , covered under the CTH 7320 which covers springs and leaves for springs, of iron or steel. Accordingly, Spring Pins are classifiable under CTH 7320 - CTH 8708 comprise of parts and accessories of the motor vehicles of CTH 8701 to 8705. The HSN explanatory notes to CTH 8708 specifically provides that parts and accessories are classifiable under CTH 8708, when they fulfill two conditions viz. the item is identifiable as being suitable for use solely or principally with the above-mentioned vehicles of this CTH and are not excluded by the provisions of the Notes to Section XVII. As per explanatory note to heading 8708, plain shaft bearings are included in parts and accessories of motor vehicles of headings 87.01 to 87.05 hence, classifiable in heading 8708.

Summary

Issues Involved:
Classification of U-bolt, Centre Bolt, Spring Pin, and Bush for tariff purposes.

Analysis:
1. U-Bolt and Centre Bolt Classification:
The applicant argued that U-Bolt and Centre Bolt should be classified under CTH 7318 as screws, bolts, and nuts. They referred to Note 2(b) to Section XVII of the Customs Tariff Act, 1975, and the HSN Explanatory Notes to support their classification. The HSN notes specifically mention that U-Bolts are covered under CTH 7318. The Centre Bolt, fulfilling the description of a bolt under CTH 7318, was also deemed classifiable under the same heading. It was concluded that items under CTH 7318 do not fall under parts and accessories of motor vehicles, thus exclusively covered under this category for tariff purposes.

2. Spring Pin Classification:
The Spring Pin was found to fall under Tariff Item 73209020, as per Rule 1 of the General Rules of Interpretation for classification. The Spring Pin, made of steel and functioning as a spring, was appropriately classified under CTH 7320, covering springs and leaves for springs of iron or steel.

3. Bush Classification:
The Bush's classification was a point of contention between CTH 8483 and CTH 8708. The HSN Explanatory Notes to CTH 8708 clarified that plain shaft bearings, including bushes, are classified under parts and accessories of motor vehicles of headings 87.01 to 87.05. Therefore, the Bush was classified under Tariff Heading 87089900, taxable at 28%.

Final Ruling:
1. U-Bolt and Centre Bolt: Classified under Tariff Heading 7318 15 00, taxable at 18%.
2. Spring Pin: Classified under Tariff Heading 7320 90 20, taxable at 18%.
3. Bush: Classified under Tariff Heading 87089900, taxable at 28%.