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TMI Blog2018 (9) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 2(74) of the CGST Act, 2017 and in the mixed supply dominance is the message printed on the pamphlet. Para 4 of Circular 11/11/2017-GST dtd. 20.10.2017 specifically clarifies that in the case of printing of books, pamphlets, brochures, annual reports, and the like, where only content is supplied by the publisher or the person who owns the usage rights to the intangible inputs while the physical inputs including paper used for printing belong to the printer, supply of printing [of the content supplied by the recipient of supply] is the principal supply and therefore such supplies would constitute supply of service falling under heading 9989 of the scheme of classification of services. Accordingly pamphlets, brochures annual reports etc are covered under the services and the applicant is engaged in printing of pamphlets etc. hence, the correct classification of the product of the applicant is 9989. Ruling:- The printing of Pamphlet/leaflet falls under the category of Supply of Service falling under SAC No.9989. X X X X Extracts X X X X X X X X Extracts X X X X ..... ding No. 4901. However, w.e.f. 29.8.2017 the Applicant after intimating the Assistant Commissioner of CGST & CE vide their letter dated 29.8.2018 started supplying the same under the category of service falling under SAC No.9989. This was done on account of clarification issued by All India Federation of Master Printer through their letter dated 8.8.2017 circulated to the members whereby it was clarified that as per the understanding given during the course of meeting of A.I.F.P delegation with the Officers of the Ministry of Finance the printed matter manufactured by printer with own physical inputs and contents are supplied by the customer, will fall under the category of supply of service, SAC No.9989. 3.2 They further submitted that subsequently, CBEC issued Circular No.11/11/2017-GST dated 20.10.2017 to provide clarification on taxability of printing contracts. However, the clarification provided by CBEC does not directly deal and does not conclusively provide clarification for leaflet when cleared on sale account. 3. 3 They submitted that according to them the printed leaflet supplied by them Merits Classification under the category of supply of goods falling under CSH No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted leaflet in SAC No.9989. Accordingly Sr.No.27 (1) of Noti.No.11/2017-CT (Rate) only covers publishing matter like news paper/books/generals/periodicals made on the basis of content supplied by publisher and Sr.No.27(2) inter-alia covers printing and re-production services of recorded media. 3.5 They submitted that accordingly printed leaflet manufactured with their own raw materials and as per content supplied by customer (other than publisher or person who owns the users right to the intangible input) does not fall under SAC No.9989 and merits classification under the category of goods only falling under CSH 4901. In other words, the above circular of CBEC supports applicant's case for classification under the category of goods. 3.6 They submitted that undisputedly the product was classifiable as excisable goods prior to introduction of GST from 01.07.2017. The CBEC under their Cir.No.1052/1/2017-CX dated 23.2.2017 provided clarifications for various printed matters falling under 48 or 49 depending upon the applicability of Chapter Notes. Further they referred follows case laws/Circulars in their defence. Sr.No. Description 1 Circular No. 1052/1/2017-CX, dated 23-2-2017 B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of marketability of the product - Impugned order set aside - Section 3 of Central Excise Act, 1944. [para 5] 6 2017 (6) G.S.T.L. 198 (Tri. - All.) = 2017 (11) TMI 812 - CESTAT ALLAHABAD Carbon leaflets/Money receipts - Classification of - Product being a printed sheet running in length and used by specific customer for specified purpose classifiable under Chapter 49 of Central Excise Tariff as product of printing industry and not under Chapter 48 ibid, [paras 4, 5, 6] 7 2017 (349) E.L.T. 499 (Tri. - All.) = 2017 (8) TMI 991 - CESTAT ALLAHABAD Paper - Interleaved Carbon Papers/Money Receipts running in length meant for specific customer for specific purpose, classifiable under Chapter 49 of Central Excise Tariff as a product of printing industry, [paras 3,4, 5,6] 8 2018 (8) G.S.T.L. 444 (Tri. - All.) = 2018 (2) TMI 65 - CESTAT ALLAHABAD Interleaved Carbon Papers/Money Receipts running in length meant for specific customer for specific purpose - Chief Commissioner of Customs, Central Excise and Service Tax, Lucknow's communication No. (30)CCO/LKO/ Tech/12/2010/705 clarifying that Heading 4820 of Central Excise Tariff did not cover printed sheets used for some specified purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion 'book' not being defined in Customs Tariff Act, 1975 natural and ordinary meaning of said expression to be kept in view, [para 50] Classification of goods - HSN explanatory notes are relevant - Drawings, designs and plans fall under Heading 49.01 of Customs Tariff Act, 1975 and not under sub-heading 4911.99 ibid as per HSN explanatory notes, [para 54] Classification of goods - Priority to be given to main entry and not residual entry - Drawings, designs and plans - Specific or basic entry is Heading 49.01 and residual entry is Heading 49.11 of Customs Tariff Act, 1975. [para 57] 11 2001 (133) E.L.T. 9 (S.C.) = 2001 (8) TMI 122 - SUPREME COURT OF INDIA Printed Matter - Printed drawings, designs and plans imported in 97 volumes under the Foreign Transfer of Technology Agreement for setting up a plant to manufacture Polyester, Polyester Filament Yarn and Polyester Staple Fibre -Contains documents in loose sheets merely put up in a folder - Not covered by the term 'printed book' under SI. No. 10 of Notification No. 25/95-Cus. but are covered by SI. No. 15 as plans, drawings and designs - Appeals allowed -Headings 49.06 and 49.11 of Customs Tariff Act, 1975. - In terms of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d meaning to the words used therein, [para 18] 12 2000 (119) E.L.T. 211 (Tribunal - LB) = 2000 (5) TMI 66 - CEGAT, COURT NO. III, NEW DELHI Printed matter - Printed book - Material imported in 97 volumes, each volume a collection of sheet paper containing printed matter, each securely fastened together at one end, and protected by two covers, to be treated as book only as each volume looks like a book and hence classifiable as printed book under Heading 49.01 of Customs Tariff Act, 1975 and not under 4911.99 ibid - Entitled to exemption under Notification 25/95-Cus. at SI. No. 10 "Printed Books" -1974 (96) ITR 672 (Guj) = 1974 (2) TMI 7 - GUJARAT HIGH COURT as approved by the Apex Court in AIR 1986 S.C. 338 = 1985 (11) TMI 1 - SUPREME COURT relied -Interpretation of Tribunal in Tractors and Farms Equipment Ltd.. 1993 (681 E.L.T. 234 (T) = 1993 (7) TMI 182 - CEGAT, NEW DELHI not a correct statement of law - The materials that were imported were contained in 97 volumes. Each volume was a collection of sheet paper containing printed matters. They were fairly securely fastened together at one end. They were protected by two covers also. It certainly looked like a book as well. Each v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he CGST Act, 2017 had to be decided and thereby the principal supply was supply of goods only and had no connection with supply of service. 3.7 They submitted that for printed matters, SAC 9988 or 9989 was relevant. SAC 9988 covers only when job work was attended on physical inputs (goods) owned by others. In this case there was no job work on inputs (goods) owned by the others and manufacturing of printed leaflet was with own inputs (goods). SAC 9989 only covers publishing matters which was evident from para No.4 of CBEC circular No.11/11/2017- GST dated 20.10.2017 and as per the pattern of levy under Sr.No. 27(1) of Noti.No.11/2017-CT (Rate). There was no any other SAC entry which was applicable to impugned goods. Therefore, the question of classification under the category of supply of service was out of context. 3.8 They submitted that under GST, the classification of products had to be decided on the basis of Custom Tariff. There was no dispute that on importation of printed leaflet supplied by overseas supplier with content given by the importer, the custom department will levy custom duty as importation of goods and not as importation of service. This also support applican ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... question may be considered as supply of goods only & not as service. 5. Discussion and Findings In the present case we, the members of Advance Ruling, have to decide as to whether the goods/service (under question) has to be considered as supply of goods falling under Chapter Sub-heading No.4901 or as a supply of service falling under SAC No.9989. 5.1 To decide the issue, it is in the interest of justice to discuss the nature of product in question and its use. As per the evidence available before us, the applicant is engaged in the process of printing of the contents, supplied by the recipient of such printed goods (client), on the paper, purchased and owned by the applicant assessee, using the link also purchased and owned by the applicant. In simple language they are engaged in printing works for which the contents of prints are supplied by their client whereas materials needed for their printing are being purchased by the applicant. 5.2 It is on record that the applicant have submitted one of the sample of a printed pamphlet along with their defence reply which is made for "Norethindrone tablets USP,0.35 mg". On simple reading of the said pamphlet it appears that the buyer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annual reports, leaflets, cartons, boxes etc., printed with design, logo, name, address or other contents supplied by the recipient of such supplies, would constitute supply of goods falling under Chapter 48 or 49 of the First Schedule to the Customs Tariff Act, 1975 (51of 1975) or supply of services falling under heading 9989 of the scheme of classification of services annexed to notification No. 11/2017-CT(R). 2. In the above context, it is clarified that supply of books, pamphlets, brochures, envelopes, annual reports, leaflets, cartons, boxes etc. printed with logo, design, name, address or other contents supplied by the recipient of such printed goods, are composite supplies and the question, whether such supplies constitute supply of goods or services would be determined on the basis of what constitutes the principal supply. 3. Principal supply has been defined in Section 2(90) of the Central Goods and Services Tax Act as supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary. 4. In the case of printing of books, pamphlets, brochures, annual reports, and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the CBEC vide Circular No. 11/11/2017-GST dtd 20.10.2017 had clarified the ambiguity arisen out of simultaneous prevalence of goods or service in the printing industry and the dominance of service in the mix supply.. 5,5.1 The Circulars issued by CBEC are commonly binding on the departmental officer as is held by the Hon'ble Supreme Court in the cases of Dhiren Chemical Industries 2002 (139) E.L.T. 3 (S.C). = 2001 (12) TMI 3 - SUPREME COURT OF INDIA Relevant extract of the judgment is reproduced below: "9. We need to made it clear that, regardless of the interpretation that we have placed on the said phrase, if there are circulars which have been issued by the Central Board of Excise and Customs which place a different interpretation upon the said phrase, that interpretation will be binding upon the Revenue." 5.5.2 Further in the case of Madras Steel Re-Rollers Association 2012(278) ELT 584 (SC), = 2012 (8) TMI 788 - SUPREME COURT OF INDIA Hon'ble Supreme Court has held as under: "7. Considering the facts and circumstances of the case and relying on the aforesaid decision of this Court, we hold that the Assessing Authorities as well as the Appellate and the Revisional Author ..... X X X X Extracts X X X X X X X X Extracts X X X X
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