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TMI Blog2020 (9) TMI 1245X X X X Extracts X X X X X X X X Extracts X X X X ..... against entry 80. ibid and therefore their goods viz. Laboratory Reagents are included therein. That, the word And used in the description is meant to separate the 2 items viz. the Diagnostic kits , and the Reagents - From a plain reading of the relevant entries 80 it appears that concessional rate of GST is applicable only to the Diagnostic kits and Reagents and not to all the items covered under Heading 3822. TRU Circular No. 163/ 19/2021-GST dated 6th October 2021 - HELD THAT:- The Circular clarifies that It is accordingly clarified that concessional GST rate of 12%o is applicable on all goods falling under heading 3822, vide Entry at S. No. 80 of Schedule II of notification No. 1/2017-Integrated Tax (Rate) dated 28.6.2017. Thus, concessional GST rate of 12% is applicable on all goods falling under heading 3822, vide Entry at S.No. 80 of Schedule II of notification No. 1/2017-Integrated Tax (Rate) dated 28.6.2017, including to Laboratory Reagents being imported and supplied by the Appellant. X X X X Extracts X X X X X X X X Extracts X X X X ..... neous chemical products" and Chapter Heading 3822 covers "Diagnostic or laboratory reagents on a backing, prepared diagnostic or laboratory reagents whether or not on a backing, other than those of heading 3002 or 3006; certified reference materials". c. Sub-heading 382200 covers "Diagnostic or laboratory reagents" as under:- Tariff Item Description of goods Unit 3822 Diagnostic or laboratory reagents on a backing, prepared diagnostic or laboratory reagents whether or not on a backing, other than those of heading 3002 or 3006; certified reference materials 382200 - Diagnostic or laboratory reagents on a backing, prepared diagnostic or laboratory reagents whether or not on a backing, other than those of heading 3002 or 3006; certified reference materials -- for medical diagnosis -- Pregnancy confirmation reagents 38220011 -- Reagents for diagnosing AIDS 38220012 -- Other 38220019 38220000 -- Other d. That, Hon'ble Karnataka Appellate Authority for Advance Ruling has vide Order NO: KAR/AAAR-08/2019-20 dated 14.01.2020 in the matter of M/s. Chromachemie Laboratory Private Limited has held as under:- "17. We find that the reagents referred to in the Heading 382 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch laboratory reagents is Chapter Heading 3822 of the Customs Tariff. It is further submitted that the Laboratory Reagents imported by the Appellant are in the nature of 'other analytical reagents used for purposes other than detection or diagnosis' and classified under Tariff Entry 3822 00 90 to CTA. g. That, the product viz. Laboratory Reagent is intended to be used exclusively for a specified analytical calibrating and referencing purposes and is classifiable under Tariff Item 3822 00 90 of the Customs Tariff, is not in dispute. h. That, Government of India has vide Notification No. 1/2017-Integrated Tax (Rate) dated 28.06.2018 ('Rate Notification'] notified the applicable rates of the Integrated Tax that shall be levied on inter-State supply of goods. The issue under consideration in the present appeal is the applicability of rate of tax on supply of the Laboratory Reagent classifiable under Tariff Item 3822 00 90 in terms of in terms of the Rate Notification. It is submitted that the only Entry in the Rate Notification which covers all diagnostic kits and reagents falling under Chapter Heading 3822 is Entry No. 80 of Schedule-II which provides for IGST ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specific exclusion or qualification which has been used before the word 'reagent' in the Entry to evidence the exclusion of any particular type of 'reagent'. It is therefore submitted that in the absence of a specific exclusion or qualification to the term 'reagent', both laboratory reagents and diagnostic reagents shall be covered under Entry 80 of Schedule II of the Rate Notification. m. That, the above view is supported by the description of various goods provided in the Rate Notification, wherein if any product is excluded from a particular heading, then such exclusions are specifically specified in the description itself. A table providing few entries in the Rate Notification, where the products are specifically excluded from the relevant Entry are as follows: S.No. Schedule Chapter Heading Description of Goods 212 I 5301 All goods i.e. flax, raw or processed but not spun; flax tow and waste (including yarn waste and garneted stock) 214 I 5303 All goods [other than coconut coir fiber] including yarn of flax, jute, other textile bast fibers, other vegetable textile fibers; paper yarn 159 III 5402, 5404, 5406 All goods other than synthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, did not exclude any grit available from any sources. Applying the principles of ejusdem generis in the instant case and, treating the Source River, for the word river" has been used before the word "sand", is not permissible. Consciously, sand manufactured by stone crushers has not been dealt with while effecting the amendment. p. It is submitted that applying the ratio of the above dicta in the instant case, it is submitted that the legislature being aware of the fact there are different kinds of reagents, has brought all the reagents under specific entry in the said Rate Notification. q. Reliance in this regard is also be placed on the case of Nandi Printers Ltd. v. State of Karnataka reported at 122 STC 164 (Kar) where the issue was whether paper boards can be covered under the entry that reads as 'paper'. The High Court allowed such classification and held as under: "It must be understood that the paper boards are a thicker or paper containing thin sheets of paper would not put it out of category of 'paper' and therefore, would not cease to be paper'. r. Therefore, in view it is submitted that Laboratory Reagent classified under Chapter heading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification covering laboratory reagent, classifying the products in the residuary entry is not warranted. This view can be supported the plethora of judgments. In the following decisions, it has been held by the Court that when a product can be classified in specific entry, classification of the same in the residuary entry cannot be taken as refuse: - -Akbar Badruddin Jiwani v. Collector of Customs, (1990 (47) E.L.T. 161(SC)] - 1990-VIL-08-SC-CU -Commissioner of Customs v. G.C. Jain, [2011 (269) E.L. T. 307 (SC)] - H.P.L. Chemicals v. C.C.E. [2006 (197) E.L.T. 324 (SC)] - 2006-VIL-32-SC-CE - Western India Plywoods v. Collector of Customs, [2005 (188) E.L.T. 365 (SC)]- 2005-VIL-62-SC-CU - CCE v. Carrier Aircon, [2006 (199) E.L.T. 577 (S.C.)]- 2006-VIL-43-SC-CE. - Speedway Rubber Company v. CCE, Chandigarh, [2002 (143) E.L.T. 0008 (S.C.)]- 2002-VIL-27-SC-CE - In Re: M&I Materials India Put. Ltd. 2018 (15) G.S.T.L 423 (A.A.R. - GST) -2018-VIL-101-AAR - In Re: Gopal Gireesh 2018 (13) G.S.T.L 469 (A.A.R. - GST) -2018-VIL-77-AAR v. The Appellant submits that the Entry SI. No 80 of Schedule II under the Notification has been incorrectly interpreted by the Authority in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and reagents" classified under Chapter Heading 3822. z. We would also submit that in terms of Section 98(6) of the CGST Act, the Advance Ruling Authority should have pronounced the Ruling in writing within 90 days from the date receipt of application. In the instant case, the Appellant filed the application on 14.10.2019 whereas the Authority has pronounced the impugned Ruling bearing No. memo no. 1055/AAR dated 28th August, 2020 after a period of almost 10 months from the date of application. Thus, the Appellant submits that there is an inordinate and unexplained delay in pronouncement of the Ruling by the Advance Ruling Authority. We would like to draw your kind attention that as per provisions of Income Tax Act ie. Section 153, where it is categorically written: "No order of assessment shall be made under section 143 or section 144 at any time after the expiry of :- 1) Two years from the end of the assessment year in which the income was first assessable, or 2) One year from the end of the financial year in which a return or a revised return relating to the assessment year commencing", Further like to draw your kind attention to the provisions of HVAT Act i.e. Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Appellant through video conferencing and emphasized on all the points already made in the Appeal whether as the grounds of Appeal or as their understanding of the facts in the case. V. DISCUSSION AND FINDINGS From the Grounds of Appeal, the appellant's submissions can be summed up as under:- - That, in the notification [01/2017-CT(R) dated 28.06.2017] providing the GST rates, there is a clear entry [No. 80] providing 12% GST rate for the "diagnostic and laboratory reagents" which covers all reagents falling under Chapter Heading 3822; That, Harmonized Commodity Description and Coding System Explanatory Notes (ENs) and the HSN notes support their interpretation. - That, Karnataka Appellate Authority for Advance Ruling (AAAR) in the matter of Chromachemie Laboratories Private Limited has held the Heading 3822 of the Customs Tariff as including both diagnostic and laboratory reagents and the ruling supports their case clearly. - That various other judgments also support their case. We find that the Appellant has argued his case on the principles of classification. The Ruling by Karnataka Appellate Authority has also been relied upon by the Appellant in the same lin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion their goods are 'Laboratory Reagents' and it is very clear from the Appellant's submissions that their goods are not Diagnostic Reagents, but are other laboratory reagents. 1.1 The thrust of the Appellant's submissions is that all the goods of the Heading 3822 have been described against entry 80. ibid and therefore their goods viz. 'Laboratory Reagents' are included therein. That, the word 'And' used in the description is meant to separate the 2 items viz. the 'Diagnostic kits', and the 'Reagents'. From a plain reading of the relevant entries 80 it appears that concessional rate of GST is applicable only to the 'Diagnostic kits and Reagents' and not to all the items covered under Heading 3822. PRESENT POSITION It is found that CBIC, in the meanwhile, has vide a TRU Circular No. 163/ 19/2021-GST dated 6th October 2021, issued under F. No. 190354/206/2021-TRU has vide Para 10, clarified about 'All laboratory reagents and other goods falling under heading 3822' as under:- "10. All laboratory reagents and other goods falling under heading 3822: - 10.1 Entry at S. No. 80 of Schedule II of notification No.1/2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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