2020 (8) TMI 566 - AAAR - GST

Classification of goods - Pattadar Pass Book cum Title Deed is a Document of Title - whether classifiable under HSN 4907 or as a Passbook under HSN 4820? - challenge to AAR decision. HELD THAT - Section 2(6-b) of the Telangana records of Rights in Land and Pattadar Passbooks Act - 1971 defines title deed and pass book means the title deed and pass book issued under section 6-A. As per Section 2(7) of the Act Pattadar means includes every person who holds land directly under the Government under a Patta whose name is registered in land revenue accounts as Pattadar and who is liable to pay land revenue. Section 2(9) defines record of right means records prepared and maintained under the provisions, or for the purposes of this Act. The Pattadar Pass Book cum Title Deed is a document containing the details of the land owned by a person. The entries in the Pattadar Pass Book are based on the Record of Rights which is prepared in terms of the provisions of the Record of Rights in Land Act, 1971. The legal provisions for issue of the Pattadar Pass Book were first introduced in the Amendment Act 11/1980 to the Andhra Pradesh Record of Rights in Land and Pattadar Pass Book, Act 1971. Prior to this the pahani was the most basic textual land record in Telangana prepared by the Village Revenue Officer. It did not constitute a Record of Rights, but it recorded details like the owner of the land, how they came to be in ownership of the land, mutations and tenancies - The Amendment Act 1/89 to the Andhra Pradesh Record of Rights in Land and Pattadar Pass Book, Act 1971 provided for updating of Record of Rights under Section 3(1) of the Act and for the regularisation of unregistered transfers and alienations under section 5-A of the Act. Either a registered document or certificate issued from the Mandal revenue officer after paying registration fee and stamp duty is considered as document of title and on the basis of such document of title the revenue authority updates the Record of Rights. The updated information in the Record of Rights is entered in the Pattadar Pass Book cum Title Deed. Therefore, the Pattadar Pass Book cum Title Deed is not a document of title as claimed by the Appellant and is not classifiable under Chapter Heading 4907 of the Customs Tariff Act, The Pattadar Pass Book cum Title Deed is classifiable under Chapter heading 4820 of the Customs Tariff Act. AAR decision upheld.

Summary

Issues Involved:
1. Classification of Pattadar Pass Book cum Title Deed under HSN 4907 or HSN 4820.
2. Determination of whether Pattadar Pass Book cum Title Deed is a "Document of Title."

Detailed Analysis:

Issue 1: Classification of Pattadar Pass Book cum Title Deed under HSN 4907 or HSN 4820

The appellant, engaged in the business of printing various stationary items, filed an application for Advance Ruling to classify the Pattadar Pass Book cum Title Deed. The Karnataka Advance Ruling Authority classified it under HSN 4820. The appellant argued that it should be classified under HSN 4907, citing that it is a document containing land ownership details and issued by the Revenue Department under the Record of Rights Act.

The appellant emphasized that the activity of printing involves both supply of goods and services, recognized as a 'composite supply' under Section 2(30) of the CGST Act, 2017. They relied on Circular No. 11/11/2017-GST, which clarified that in printing activities where content is supplied by the recipient and physical inputs belong to the printer, the supply is classified as a service under heading 9989. They argued that the classification of Pattadar Pass Book cum Title Deed should be determined as per the Customs Tariff Act, 1975 (CTA) and HSN, and should fall under Tariff Entry 4907 00 90.

The appellant presented that Chapter Heading 4907 covers documents like banknotes, cheque forms, stock certificates, and similar documents of title, which have fiduciary value. They argued that the Pattadar Pass Book cum Title Deed, issued under the Telangana Rights in Land and Pattadar Pass Books Act, 1971, is a document evidencing land transactions and should be classified under Chapter Heading 4907.

Issue 2: Determination of whether Pattadar Pass Book cum Title Deed is a "Document of Title"

The appellant argued that the Pattadar Pass Book cum Title Deed is a document of title, citing several legal precedents where courts held that such documents are prima facie evidence of ownership. They relied on cases like K.J. Nathan v. Maruthi Rao and others, Rajeshwari Home Developers India v. The District Revenue Officer, and Masina Sriramulu v. Pasagadagalu Pydaiah, where courts recognized pattadar passbooks as documents of title.

The appellant contended that the Authority for Advance Ruling's understanding that the Record of Rights maintained by the Mandal Revenue Officer is the actual document of title is misplaced. They argued that revenue records are not documents of title but merely raise a presumption of possession. They cited the Supreme Court's ruling in Gurunath Manohar Pavaskar and Ors. v. Nagesh Siddappa Navalgund and Ors., which held that revenue records are not documents of title.

The appellant further argued that the Pattadar Pass Book cum Title Deed serves as evidence for securing loans and other credit facilities, and its classification under Chapter Heading 4820, which covers general stationery items, is incorrect. They emphasized that the printing on passbooks is not incidental but essential for their use, thus meriting classification under Chapter Heading 4907.

Judgment:

The appellate authority examined the provisions of The Telangana Records of Rights in Land and Pattadar Passbooks Act, 1971, and concluded that the Pattadar Pass Book cum Title Deed is based on the Record of Rights maintained by the Mandal Revenue Officer. The authority noted that the Pattadar Pass Book cum Title Deed has evidentiary value but not fiduciary value to be considered a document of title.

The authority found that the Pattadar Pass Book cum Title Deed is not a document of title as claimed by the appellant and is classifiable under Chapter Heading 4820 of the Customs Tariff Act. The authority upheld the Advance Ruling Authority's decision, dismissing the appeal on all accounts. The classification under HSN 4820 was deemed appropriate as the Pattadar Pass Book cum Title Deed falls under articles of stationery rather than documents of title.