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TMI Blog2020 (12) TMI 1335X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of CGST fee and non-filing appeal in prescribed format are procedural lapses - the payment of appeal fee and filing of appeal in prescribed format is mandatory requirements as per provisions of Section 100 (3) of the CGST Act, 2017. Section 100 (3) of the CGST Act, 2017 stipulates that every appeal under this section shall be in such form, accompanied by such fee and verified in such manner as may be prescribed. The said rules do not provide any discretion in non- implementation. The appellant has relied upon on the decisions in CENTRAL INDIA TOBACCO PRODUCTS PVT. LTD. VERSUS COLLECTOR OF CENTRAL EXCISE [ 1987 (2) TMI 256 - CEGAT, NEW DELHI] and UNION OF INDIA, DELHI VERSUS ROSHAN LAL AND ANR. [ 1967 (9) TMI 157 - DELHI HIGH COURT] where the issue was related to non-payment of court fees, but in this case, issue is related to determination of date of filing of appeal also. In this case, part fee has been deposited on 15.06.2020 and second part fees have been deposited on 22.10.2020. In this case complete fee has been deposited and appeal in prescribed format has been filed after more than 30 days from the due date of filing of appeal. Therefore, these case laws are not s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed appeal on line on 17.06.2020. The Appellant has deposited SGST fee of Rs. 10000/- on 15.06.2020 and CGST fee of Rs. 10000/- on 22.10.2020 and submitted hard copy of appeal on 28.10.2020. On perusal of appeal it was found that the appellant has not filed the appeal in prescribed format, therefore, a letter dated 29.10.2020 has been issued to the appellant to file the appeal in prescribed format. The appellant filed the appeal in prescribed format on 02.11.2020. The Appellant has also filed misc application for condonation of delay. The Appellant in its appeal has, inter-alia, mentioned the following grounds of appeal. (i) That the learned MR while ruling the classification of the product has failed to understand the basic nature and characteristic and usage of the Henna powder in pure form. The leaves of mehandi are obtained from a shrub (Plant) and powder or paste of these leaves gives brownish red colour. It is used to beautify the hands and feet by woman of community on all cultural, marriage and festive functions. The use of henna (powder or paste) on the hands and feet by women in India is prevalent since times immemorial and it is a common man s knowledge that mehandi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 14 of the Tariff indicates that, both prior to as well as after 2006, it covered products not elsewhere specified or included . Henna Powder specifically having been included in Chapter 14 (under TH 1404 thereof) and, therefore, it is clear that the said Henna Powder is not includible anywhere else in the Tariff. This position remained unchanged. There has been no amendment in any other provision in the Tariff (both Customs and erstwhile Central Excise Tariff) as could justify bringing Henna Powder within the fold thereof, even after 2006. It is well settled that, where the item finds specific mention in a particular Tariff entry, it has to be classified therein and cannot be relegated to any other Tariff entry [Ref: Rule 3 of Rules for the interpretation of Schedule to the Tariff]. Henna is undisputedly classifiable only under TH 1404 of the Tariff and cannot be relegated to any other entry therein including TH 3304 and 3305. TH 3304, for its part, covers beauty or make up preparation and preparations for the care of the skin (other than medicaments), including sunscreen or suntan preparations; manicure or pedicure preparations. In the context of tax law, preparation has a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in. In the process of registration in the website, an option was asked from the assessee to provide the name of the finished product which they intend to supply. Once the said product was entered, the next option available to the assessee on the screen was to find out the HSN Code for the opted goods. Accordingly, whenever the assessee inserted the name of their finished product as Henna leaves and Henna powder after providing the said details, HSN code 1404 1011 was generated for Henna leaves and 1404 1019 for Henna powder. Therefore, henna powder is undoubtedly classifiable under Chapter 14 under Tariff Heading 1404. (iv) THAT the Members of the Association had been clearing the products Henna Powder at a GST rate of 5% treating it as Vegetable products not elsewhere specified or included, falling under Chapter 14 of the GST Tariff. (v) THAT Notification 6/2018 supra, introduces a specific description by name Mehandi paste in cones under TH 1404. According to the said Notification, the said goods having a description Mehandi paste in cones shall be eligible to Central Tax Rate of 2.5%. The goods with said description have been treated as Schedule I items. An int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the entry as henna/mehandi powder under GST laws. On the other hand henna powder as mentioned specifically in the registration certificate issued by the department to the henna manufacturers, henna powder is clearly included under chapter 14 sub-heading 1404 1019 vegetable products not elsewhere specified or included. If the manufacturer is selling henna powder with a clear indication on the packet preparation for use on hair, the product may fall under TH 3305. A general view cannot be adopted by the department regarding henna powder as hair dye, since it is an organic nature dye used since ancient time by women for applying on their hands and feet on auspicious occasions. It is a settled law that with regard to the classification of goods and matter relating to the chargeability, the burden is heavily cast upon the revenue which has to prove its case with positive evidence. Therefore, in the case of henna powder, the department while proposing to include its classification under chapter heading 3305 will have to prove beyond doubt that such henna powder (not mixed with any other ingredient) is specifically meant for use on hair and is a preparation. Hence leaf is an agricul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for use on the hair and Central Excise duty at the rate of 8% is chargeable. The case decided in the light of explanations given by the department in their short reply. Hence, pure Henna powder can be included in Chapter 33 when it is only meant as preparation for use on hair. (ix) That it is a well settled principle of law in the matters of classification the concept of common parlance has great significance. As it is to every body s knowledge in India that henna/mehandi in common parlance is used in India by women for applying on their hands and feet on all religious and auspicious occasions. Therefore, its (henna powder) main use is application on hands and feet by women, but if it is specifically sold as a product/preparation for use on hair. It would merit classification under Chapter 3305. (x) That in the case of classification, one may also refer to the judgement of the Hon ble Tribunal in the case of Mayuri Henna Herbal (P) Ltd v CCE, Indore, 2012 (281) ELT 118. In this case, for the year 2007-08 and 2008-2009 (upto 3.6.2008), the party was engaged in repacking or manufacturing of pure henna powder in. 100 gram, 200 gram and 500 gram packets used for applying t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that the hard copy of the Advance ruling Order No. RAJ/AAR/2020/01 dated 06.05.2020 has been received by them through post on 18.05.2020. They had engaged a counsel from Delhi. Owing to covid-19 pandamenic, there has been delay in communication with the counsel and preparing and finalizing of the appeal. (xv) In view of above appellant has prayed to :- (a) quash and set aside the impugned Advance Ruling No. RAJ/AAR/2020-21/01 dated 06.05.2020 and thereby direct classification of the product Henna Powder under Chapter 1404, (b) to condone the delay of 10 days in filing the accompanying appeal. (c) to grant personal hearing of the appellant, and (d) to pass such order or orders, as may be deemed fit and proper in the interest of justice. 5. PERSONAL HEARING A virtual personal hearing in the matter was held on 03.12.2020. Sh. S. Sunil, Authorized Representative of the appellant, appeared for personal hearing on 03.12.2020. He reiterated the submissions already made under grounds of appeal. He also submitted additional submissions on 07.12.2020 which is as under:- 5.1 The appeal has been filed before the Appellate Authority under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to generate the challan and pay only the fee of Rs 10,000/- towards SGST. The system was not showing any other amount of fee to be paid towards CGST. At the relevant time, it was not possible to physically file an appeal or to deposit fee through any other mode. As the court fee was mandatorily required to be paid through online, the applicant was handicapped. Therefore, the applicant paid the SGST on 15.06.2020 so that the appeal could be filed within the period of limitation. After depositing the fee towards SGST, on 15.06.2020, the appellant electronically filed the appeal on 17.06.2020. 5.3 After filing of the appeal, there was no communication either written or oral for almost three and half months. The appellant forwarded the copy of the appeal to the department through their local consultant. On receipt of the copy of the appeal, it probably came to the notice of the department that there is a deficiency in fee payment. The appellant has paid only an amount of Rs.10,000 towards SGST and has not paid Rs.10,000 towards CGST, at the time of filing of the appeal. The appellant immediately made the deposit on 22.10.2020. A copy of the challan was also forwarded to the dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Court has a discretion albeit judicial discretion to allow a litigant to pay the Court-fee prescribed for any document by the law, which he should have paid earlier and the subsequent payment is to have the same force and effect as if such fee had been paid in the first instance. In the light of the above submissions, it is respectfully prayed that the delay in filing fee towards CGST may be condoned and the appeal may not be treated as time barred for such procedural lapses and the appeal may be decided on merits. 5.7 Re: Submission on HSN In the appeal, the appellant has pointed out that in the HSN henna continues to remain under Chapter 14. However, copy of the HSN was not submitted. With the present submission, the appellant is also submitting copy of relevant HSN. This would prove beyond doubt that Henna is a vegetable product not elsewhere specified and cannot be taken out of Chapter 14. 6. We have examined the appeal memo filed by the appellant and submissions including written filed by them during the personal hearing. 6.1. The first issue relates to the delayed filing of appeal under Section 100 (2) of the CGST ACT. The appellant has submitted that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 100(2) ibid, the applicant was required to file the appeal by 17.06.2020. However, Notification No. 35/2020-CT dated 03.04.2020 as amended vide Notification No. 55/2020-CT dated 27.06.2020 has extended the due date of compliance with any actions including filing of the instant appeal upto 31.08.2020. It has not been brought to the notice by the appellant that the such date has been further extended. Hence, the last date of filing appeal in this case was 31.08.2020. In the light of provisions and fact discussed above, we observe that the appellant has filed incomplete appeal on portal on 17.06.2020 without CGST fee and has filed the appeal in prescribed format (hard copy) on 02.11.2020. Therefore, we find that the date of filing of appeal is 02.11.2020 which is 63 days delay from the last date i.e 31.08.2020. Further, the Appellant has deposited CGST (appeal) fee of Rs. 10000/- on 22.10.2020. As per provisions, the authority has discretion to condone the delay for 30 days. As discussed, we hold that delay in filing of this appeal is beyond the discretionary power (30 days) provided to Appellate authority. Therefore, condonation application filed by the appellant is liable to be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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