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TMI Blog2021 (1) TMI 583X X X X Extracts X X X X X X X X Extracts X X X X ..... ontinuous web and under control pressure thermal bonding. The resultant product is non Woven fabrics which is called Polypropylene Non Woven Fabric. 3. The applicant submitted that prior to introduction of Goods and Service Tax Act, the Polypropylene Non Woven Bags were being classified under heading No. 6305 being product manufactured through Non woven fabric classifiable under Heading No. 5603. 4. The applicant further submitted that prior to introduction of Goods and Service Tax Act, the classification of Polypropylene Non Woven bags was in question before the authority under Section 94 of the Kerala Value Added Tax Act, 2003 in the case of M/s. Malabar Treads, Manjeri. The authority after considering the Heading No. 5603 as appearing in the Schedule to the Central Excise Tariff concluded that the said product would appropriately be classifiable under HSN code 6305.33.00 of the Custom Tariff Act which correspondence to entry No. 174 (7) (1) of List A of the third Schedule to the KVAT Act, 2003. 5. The applicant submitted that the after the introduction of GST Act, 2017 one of the manufacturer M/s. Karam Green Bags had approached DKTE Centre of Excellence in Non Wovens (Govt. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licant's interpretation of law and/or facts 10. The applicant submitted that the Polypropylene Non Woven Bags are being manufactured out of Non Woven fabrics which are admittedly classifiable under heading No. 5603i.e. as Textile Article and therefore the product manufactured out of the said material will have to considered as textile article and classifiable under Heading No. 63.05. 11. The applicant submitted that in view of Rules of interpretation Heading No. 6305.3300 being specific heading would prevail over the general Heading of 3923. 12. The applicant submitted that the Hon'ble Advance Ruling Authority as referred herein above as also the Hon'ble Appellate Advance Ruling Authority have settled the law and have confirmed the classification of Polypropylene Non Woven Bags under heading No. 6305.33.00 and therefore the same would be binding. The decision of Hon'ble Appellate Authority for Advance Ruling is of 13.05.2019, i.e after the clarification issued by TRU section of Ministry of Finance and therefore the same would be prevail over the clarification. 13. The Applicant submitted that the Director of DKTE Center of Excellence in Non Woven have also clarified beyond doub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able under CTH 6305. The relevant chapter Note, headings, HSN Explanatory Notes are examined as under: 6305 SACKS AND BAGS, OF A KIND USED FOR THE PACKING OF GOODS 6305 10 -Of jute or of other textile bast fibres of heading 5303 : ............................................... 6305 20 00 Of cotton Of man-made textile material : 6305 32 00 --Fexible intermediate bulk containers 6305 33 00 --Other, of polyethylene or polypropylene stip or the like 6305 39 00 --Other 6305 90 00 -Of other textile materials Further, explanations to the Heading 6305 90 00, in HSN is as follows : 63.05 -Sacks and bags, of a kind used for the packing of goods (+). 6305 10 -Of jute or of other textile bast fibres of heading 5303 : 6305 20 00 -Of cotton -Of man-made textile material : 6305 32 00 --Flexible intermediate bulk containers 6305 33 00 --Other, of polyethylene or polypropylene stip or the like 6305 39 00 --Other 6305 90 00 -Of other textile materials This heading covers textile sacks and bags of a kind normally used for the packing of goods for transport, storage or sale. These articles, which vary in size and shape, include in particular flexib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ures 3923.90 - Other This heading covers all articles of plastics commonly used for the packing or conveyance of all kinds of products. The articles covered include : (a) Containers such as boxes, cases, crates, sacks and bags (including cones and refuse sacks), casks, cans, carboys, bottles and flasks. The heading also covers : (i) Cups without handles having the character of containers used for the packing or conveyance of certain foodstuffs, whether or not they have a secondary use as tableware or toilet articles; (ii) Bottle preforms of plastics being intermediate products having tubular shape, with one closed end and one open end threaded to secure a screw type closure, the portion below the threaded end being intended to be expanded to a desired size and shape. (b) Spools, cops, bobbins and similar supports, including video or audio cassettes without magnetic tape. (c) Stoppers, lids, caps and other closures. The heading excludes, inter alia, household articles such as dustbins, and cups which are used as tableware or toilet articles and do not have the character of containers for the packing or conveyance of goods, whether or not sometimes used for such pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppropriate classification of HDPE Woven Bags/Sacks, the Hon'ble High Court has opined; '..............the process of manufacture of HDPE tapes, the earlier judgments of the CEGAT approved by the Supreme Court and accepted by the department clearly go to show that HDPE bags are the bags woven by plastic strips and they, therefore, are goods of plastic and the material used for weaving those bags being the strips of plastic made from plastic granules, the strips of plastic used for weaving aforesaid HDPE woven sacks has to be classified as an item under Entry 3920 of Chapter 39 and not under Entry 5406 of Chapter 54. Accordingly, entries of finished goods have also to be made under proper Chapter of the Tariff Act treating them as the finished goods made of plastic strips. In the result we hold that HDPE strips or tapes fall under the Heading 3920, Sub-heading 3920.32 of the Central Excise Tariff Act and not under heading 5406, sub-heading 5406.90. Similarly HDPE Sacks fall into Heading 3923, Sub-heading 3923.90....' 23. In the above decision, Hon'ble High Court of Madhya Pradesh has discussed what is textile according to the Section 2(g) of Textiles Committee Act, 1963 (Act 41 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the Hon'ble Supreme Court and therefore relied upon the specific last line of the Paragraph of the order. Whereas, in order to understand the meaning of said Paragraph, it is necessary to read the order thoroughly and comprehensively. The Hon'ble Supreme Court, in the said Order has defined what is textile and the relevant part of the order is reproduced as under for better understanding: 6. There can, therefore, be no doubt that the word 'textiles' in Item 30 of Schedule 'B' must be interpreted according to its popular sense, meaning "that sense which people conversant with the subject-matter with which the statute is dealing would attribute to it". There we are in complete agreement with the Judges who held in favour of the Revenue and against the assessee. But the question is : What result does the application of this test yield? Are 'dryer felts' not 'textiles' within the ordinary accepted meaning of that word? The word 'textiles' is derived from the Latin 'texere' which means 'to weave' and it means any woven fabric. When yarn, whether cotton, silk, woollen, rayon, nylon or of any other description or made out of any other material is woven into a fabric, what comes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed before the above word. The fabric made of Fiber grade Poly Propylene granules is not a "similar type of material" of cotton, silk, rayon or nylon. Hence fabric made of Fiber grade Poly Propylene granules cannot be considered as textile. Hence, ratio of above case law is not squarely applicable to the present case. 26. Reference is also invited to CBIC (TRU) Circular No.80/54/2018-GST issued from F. No. 354/432/2018-TRU dated 31st December, 2018, clarifying GST rates & classification in respect of various goods. Para 7 of subject Circular has clarified that the goods viz. polypropylene woven and non-woven bags are classifiable under HS code 3923 and attracts GST @ 18%, the relevant portion is extracted as below: "Applicability of GST on supply of Polypropylene Woven and Non-Woven Bags and PP Woven and Non-Woven Bags laminated with BOPP : 7.1 Representations have been received seeking the classification and GST rates on Polypropylene Woven and Non-Woven Bags and Polypropylene Woven and Non-Woven Bags laminated with BOPP. 7.2 As per the explanatory notes to the HSN to HS code 39.23, the heading covers all articles of plastics commonly used for the packing or conveyance of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er" shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of this notification. The rates of GST leviable on above product were changed from time to time, as discussed below: (A) From 01.07.2017 to 30.09.2019: The goods of Chapter heading 3923 are covered under Sr. No. 108 of Schedule-III of Notification No.01/2017-CT (Rate) dated 28.06.2017, up to 30.09.2019 and therefore, the applicable rate of total GST was 18% (CGST- @ 9%+ SGST- @ 9%) up to 30.09.2019, as reproduced herein below: Schedule III- 9% Sl.No. Chapter/Heading/Sub Heading/ Tariff Item Description of the Goods 108. 3923 Articles for the conveyance or packing of goods, of plastics; stoppers, lids, caps and other closures, of plastics (B) From 01.10.2019 to 31.12.2019: The Notification No.14/2019-C.T.(Rate) dated 30.09.2019, amended the Notification No. 01/2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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