2019 (2) TMI 190 - AAR - GST

Classification of goods - Eucalyptus/ Polar Wood Waste in Logs having length of 30 cm to 200 cm and Girth of approx. 10 cm to 60 cm - whether covered under HSN 4401 and chargeable to tax under Uttarakhand State GST @ 2.5% and under CGST @ 2.5%? Held that - Though the applicant is seeking advance ruling in respect of Eucalyptus / Poplar Woods Waste in Logs having length of 30 cm to 200 cm and Girth of approx. 10 cm to 60 cm, so as to classify the same under Chapter heading 4401 (attracting GST @ 5% in respect of Wood in chips or particles), the applicant has failed to correctly frame the question to which the classification is sought from the authority - since length and girth are not criteria for classification of wood under Chapter 44 or more specific 4401, therefore, the answer in given-in negative to the question which the applicant has sought.

Summary

Issues:
1. Application seeking advance ruling on the classification and tax liability of Eucalyptus/Poplar Wood Waste in Logs under HSN 4401.

Analysis:
The application was filed by M/s. Sharda Timber seeking a ruling on whether Eucalyptus/Poplar Wood Waste in Logs falls under HSN 4401 and is chargeable to tax under Uttarakhand State GST and CGST at 2.5%. The authority admitted the application as it pertained to the classification of goods and determination of tax liability, falling under Section 97(2)(a) & (e) of the CGST/SGST Act, 2017.

The applicant was granted a personal hearing where relevant details were presented. The ruling was sought on the classification and tax liability of Eucalyptus/Poplar Wood Waste in Logs under HSN 4401. To address this, the authority referred to the GST Tariff and Customs Tariff manuals for classification guidelines.

The Customs Tariff manual was consulted to determine the classification of Eucalyptus/Poplar Wood Waste in Logs under HSN 4401. The description of goods under HSN 4401 did not mention specific criteria like length and girth of wood waste in logs. It was noted that wood in the rough, falling under HSN 4403, attracts a higher GST rate of 18%.

The ruling concluded that Eucalyptus/Poplar Wood Waste in logs, with specified dimensions, does not fall under HSN 4401 of the GST Tariff Act. Therefore, it is not chargeable to GST at 5% (CGST at 2.5% and SGST at 2.5%). The classification criteria did not align with the applicant's query, leading to a negative ruling on the issue.

In summary, the ruling clarified the classification and tax liability of Eucalyptus/Poplar Wood Waste in Logs under HSN 4401, highlighting the importance of accurate framing of questions for advance rulings and the relevance of classification guidelines from the Customs and GST Tariff manuals.