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2022 (11) TMI 139 - AAR - GSTClassification of goods - rate of GST - HSN Code - manufacturing of Industrial Safety belt and Harness - to be classified under HSN code 6307 or not - HELD THAT - It is found that there is no specific heading in the tariff for classification of industrial safety belt manufactured by the applicant. It appears that the item industrial safety belt made of nylon, which may be termed as life belt, can be covered under Tariff item 6307 20 90. Further, serial number 224 of Schedule I and serial number 171 of Schedule-II respectively of Notification No. 01/2017-Central Tax (Rate) dated 28.06.2017, as amended from time to time, corresponding State Tax Notification No. 1125-F.T. dated 28.06.2017, as amended . The item industrial safety belt manufactured by the applicant would be classified under chapter sub-heading 6307 20 90 and tax would be levied @ 5% of item sale value not exceeding Rs.1000/- per piece and @ 12% in case where sale value exceeds Rs.1000/- per piece.
Issues: Classification of goods under HSN Code and applicable tax rate.
Classification of Goods under HSN Code: The judgment addresses the classification of Industrial Safety Belts and full Body Harness under the HSN Code. The applicant contended that the items fall under HSN Code 6307, while the revenue officer argued that the items do not fit under this classification. The Authority examined the nature of the products and their usage, emphasizing that the safety belts serve as a form of protective equipment to prevent injury or death from falling. They noted that the item essentially bears the character of a life belt due to its purpose in safeguarding users from falls. Despite the absence of a specific heading for industrial safety belts in the tariff, the Authority concluded that the item could be termed as a life belt based on its function and use. Applicable Tax Rate: Regarding the applicable tax rate, the applicant proposed tax rates of 5% for items not exceeding Rs.1000 per piece and 12% for items exceeding Rs.1000 per piece. The revenue officer raised concerns about the classification of the items under HSN Code 6307. However, the Authority referred to Tariff Item 6307 20 90, which covers items like life-jackets and life-belts made of textiles. They also cited relevant notifications specifying tax rates for such textile articles. Consequently, the Authority ruled that the Industrial Safety Belt would be classified under chapter sub-heading 6307 20 90, with a tax rate of 5% for items not exceeding Rs.1000 per piece and 12% for items exceeding Rs.1000 per piece. In conclusion, the judgment provides a detailed analysis of the classification of Industrial Safety Belts under the HSN Code and the applicable tax rates based on the value of the items. The Authority's decision was informed by the nature and purpose of the products, ultimately classifying them as life belts and determining the corresponding tax rates in accordance with the relevant tariff items and notifications.
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