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2019 (5) TMI 494 - AAR - GSTClassification of vehicle - Tata Harrier vehicle - whether classifiable under Tariff Item 8703 32 91 or 8703 32 99 of the First Schedule to the Customs Tariff Act, 1975? - HELD THAT - Considering the subject vehicle as having a compression-ignition internal combustion piston engine (diesel or semi-diesel) of a cylinder capacity exceeding cc but not exceeding 2500cc, it is to be held that the subject Tata Harrier vehicle Will be considered as motor cars and classifiable under heading 8703 32 91 of the GST Tariff. If the vehicle satisfies only the conditions mentioned in main clause but is not satisfying any one or all of the conditions mentioned in Explanation , whether it would still be covered under Entry at Sr. No. 52B of Notification No. 1/2017- Compensation Cess (Rate) dated 28.06.2017 as amended? - HELD THAT - In taxing statute, the word include/ including is generally used in interpretation clauses as a word of enlargement, though the use of word include/ including in the restrictive sense is not unknown. In view of the specifications given by the applicant there is no doubt that the subject vehicle will attract 22% compensation cess under Sr. No. 52 B of the said Notification - Hence if the vehicle satisfies only the conditions mentioned in main clause but is not satisfying any one or all of the conditions mentioned in Explanation , then it would not be covered under Entry at Sr. No. 52B of the said Notification. For the purpose of Cess @ 22% under Sr. No 52B of Notification No. 1/2017 Compensation Cess (Rate) dated 28.06.2017 as amended, whether the ground clearance of the vehicle is to be considered in laden condition or in unladen condition? - HELD THAT - The rate of tax on the subject vehicle before it is sold to buyers. It is but natural that the ground clearance given in the Notification must arrived in unladen state, when there are no passengers/driver occupying the vehicle. We are of the opinion and we agree with the submissions of the jurisdictional office in this regard that the ground clearance in laden condition cannot be considered because the same will vary depending on the weight of passengers and luggage occupying the vehicle and will therefore cannot be constant. Whether Tata Harrier vehicle whose ground clearance in unladen condition is 205 mm and in laden condition is 1.60 mm, would fall under r. No. 52B of the Notification No. 1/2017-Compensation Cess. (Rate) dated 28.06.2017 as amended? - HELD THAT - The Tata Harrier vehicle whose ground clearance in unladen condition is 205 mm and in laden condition is 160 mm, would fall under Sr. No. 52B of the Notification No. 1/2017-Compensation Cess. (Rate) dated 28.06.2017. Whether GST Compensation Cess @ 22% under Sr. No. 52B of Notification No. 1/2017-Compensation Cess (Rate) dated 28.06.2017 as amended, will be applicable to Tata Harrier vehicle? - HELD THAT - GST Compensation Cess @ 22% under Sr. No. 52B of Notification No. 1/2017-Compensation Cess (Rate) dated 28.06.2017 will applicable in the subject case. Whether vehicle whose ground clearance in unladen condition is more than 170 mm but below 170mm in laden condition, will get covered under Sr. No. 52B of Notification No. 1/2017-Compensation-Cess (Rate) dated 28.06.2017? - HELD THAT - To get covered under Sr. No. 52B of Notification No. 1/2017-Compensation.Cess (Rate) dated 28.06.2017, the ground clearance should be more than 170 mm in unladen condition - the ground clearance must be considered only on the basis on unladen weight and are firmly of the opinion that the minimum ground clearance must be considered only on the basis of unladen condition.
Issues Involved:
1. Classification of Tata Harrier vehicle under Customs Tariff Act. 2. Applicability of conditions for classification under Sr. No. 52B of Notification No. 1/2017-Compensation Cess (Rate). 3. Consideration of ground clearance for Cess calculation. 4. Applicability of GST Compensation Cess @ 22% to Tata Harrier. 5. Classification of vehicle with different ground clearances in laden and unladen conditions. Detailed Analysis: Issue 1: Classification of Tata Harrier Vehicle The primary question was whether the Tata Harrier vehicle is classifiable under Tariff Item 8703 32 91 or 8703 32 99 of the Customs Tariff Act, 1975. The Authority concluded that the Tata Harrier, with its specifications, falls under Chapter Heading 87 of the GST Tariff, specifically under heading 8703 32 91, as it is a motor car with a compression-ignition internal combustion piston engine (diesel) of a cylinder capacity exceeding 1500 cc but not exceeding 2500 cc. Issue 2: Conditions for Classification under Sr. No. 52B of Notification No. 1/2017-Compensation Cess (Rate) The second issue was whether a vehicle must satisfy both the conditions in the main clause and the conditions in the Explanation to be classified under Sr. No. 52B of the said Notification. The Authority clarified that for a vehicle to be covered under Sr. No. 52B, it must satisfy both the main clause conditions (engine capacity above 1500 cc and being popularly known as SUV/UV) and the conditions mentioned in the Explanation (length exceeding 4000 mm and ground clearance of 170 mm and above). Issue 3: Ground Clearance Consideration for Cess Calculation The third question addressed whether the ground clearance should be considered in the laden or unladen condition for the purpose of applying the 22% Cess under Sr. No. 52B. The Authority decided that the ground clearance must be considered in the unladen state, as the laden condition varies with the weight of passengers and luggage, which cannot be standardized. Issue 4: Applicability of GST Compensation Cess @ 22% to Tata Harrier The fourth issue was whether the Tata Harrier, with a ground clearance of 205 mm in unladen condition and 160 mm in laden condition, falls under Sr. No. 52B of the Notification No. 1/2017-Compensation Cess (Rate). The Authority affirmed that the Tata Harrier vehicle meets the criteria for classification under Sr. No. 52B and is therefore subject to the 22% GST Compensation Cess. Issue 5: Classification of Vehicle with Different Ground Clearances in Laden and Unladen Conditions The final issue was whether a vehicle with a ground clearance of more than 170 mm in the unladen condition but below 170 mm in the laden condition would still be covered under Sr. No. 52B. The Authority concluded that to be covered under Sr. No. 52B, the ground clearance must be 170 mm or above in the unladen condition. Conclusion: - Classification: Tata Harrier is classifiable under Tariff Item 8703 32 91. - Conditions for Sr. No. 52B: Vehicle must satisfy both main clause and Explanation conditions. - Ground Clearance: Considered in unladen condition. - GST Compensation Cess: 22% applicable to Tata Harrier. - Ground Clearance Variance: Must be 170 mm or above in unladen condition to be covered under Sr. No. 52B.
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