2020 (7) TMI 406 - AAR - GST

Classification of supply - supply of goods or supply of services - supply of print on flex - whether under HSN 4911 under entry no 132 of Schedule II of Notification 1/2017- CTR - supply of print on flex non commercial purpose, classifiable under HSN 4911 under entry no 132 of Schedule II of Notification 1/2017- CTR or not - HELD THAT - The applicant in the instant case is engaged in supply of printed flex material and the raw materials of the goods in questions are completely procured by the applicant himself. Immaterial of the fact that whether the content is supplied by the customer or it is designed by the applicant himself basing on the requirement of the customer, the applicant transfers the title in the goods i.e., printed material on flex to the customer - the applicant is transferring the title in goods to his customers in the form of printed flex material and it amounts to nothing but supply of goods only. Rate of tax of the goods - HELD THAT - The supply of print on flex is classifiable vide Notification No.1/2017 - Central Tax (Rate) dated 28.06.2017 under Sl.No.132 under HSN code 4911 and attracts tax rate of 12%. Further, the same has been clarified in detail vide the clarification issued under F.No.354/263/2017 - TRU, Dt 20th October, 2017 in Circular No.11/11/2017-GST. Whether supply of print on flex non-commercial purpose is also classifiable under HSN 4911 under entry no 132 of Schedule II of Notification 1/2017- CTR? - HELD THAT - The applicant did not submit any specific details pertaining to the question that what would constitute commercial / Non-Commercial in the context of trade as mentioned by him. Nevertheless, the supplier of the goods i.e., applicant in this context shall levy and collect tax from the recipients for the taxable supplies made by him as per the classification of the goods and tax rates as specified in the notifications of the CGST / APGST Act 2017 from time to time as amended.

Summary

Issues involved:
1. Classification of supply of print on flex as goods or service.
2. Applicability of HSN code 4911 under entry no 132 of Schedule II of Notification 1/2017- CTR.
3. Classification of supply of print on flex for non-commercial purposes under HSN 4911.

Issue 1: Classification of supply of print on flex as goods or service:
The applicant, engaged in supplying printed flex material, transfers the title in goods to customers. As per Section 7 of the CGST Act, any transfer of title in goods constitutes a supply of goods. Therefore, the supply of print on flex is deemed to be a supply of goods.

Issue 2: Applicability of HSN code 4911 under entry no 132 of Schedule II of Notification 1/2017- CTR:
The supply of print on flex is classified under HSN code 4911 as per Notification No.1/2017 - Central Tax (Rate), attracting a tax rate of 12% (CGST 6% + SGST 6%). This classification is supported by circulars clarifying the taxability of printed materials falling under chapter 48 or 49 as predominantly goods.

Issue 3: Classification of supply of print on flex for non-commercial purposes under HSN 4911:
The ruling confirms that the supply of print on flex for non-commercial purposes does not alter its classification under HSN 4911. The same tax rate of 12% applies as mentioned above for both commercial and non-commercial uses.

Summary:
The Authority for Advance Ruling, Andhra Pradesh, determined that the supply of print on flex by the applicant is classified as a supply of goods under the CGST Act. The supply falls under HSN code 4911 and is subject to a tax rate of 12% as per Notification No.1/2017. This classification applies irrespective of the commercial or non-commercial use of the printed flex material. The ruling is based on the interpretation of relevant provisions and circulars clarifying the tax treatment of similar printed materials.