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TMI Blog2022 (8) TMI 970X X X X Extracts X X X X X X X X Extracts X X X X ..... r than heading 8487, 8548 or 9033) are in all cases to be classified in their respective headings. In the instant case, the parts accessories of hearing aids are goods that are specifically covered under heading 9021 9010 and hence they merit classification in their respective heading i.e. 9021 9010. Also Note 2(b) implies that it covers only those other parts and accessories which can t be classified in terms of Note 2(a) - In other words Note 2(a) is applicable to the instant case and Note 2(b) has to be considered in case Note 2(a) is not applicable. Thus the parts accessories of hearing aids are rightly classifiable under heading 9021 9010. The exemption is applicable only to supply of goods, the description of which is specified at column (3) of the schedule falling under the tariff item, sub-heading, heading chapter as specified at corresponding entry at column (2). Thus the exemption is applicable only to the supply of goods described under column (3) and not to all the goods falling under the corresponding entry in column (2) - It is clearly evident from the entry no.142 that the said entry covers only goods described as hearing aids and not the parts accessories of the hea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8% GST, in terms of entry No.453 of Schedule III to the Notification 1/2017-CT (R) dated 28.06.2017. 4.3 The applicant seeks advance ruling on classification and rate of tax on supply of parts & accessories that are suitable for use solely with the hearing aids. 5. Applicant's Interpretation of Law: 5.1 The applicant wishes to draw the attention to Explanation (iv) to 1/2017-CTR which provides that "the rules for the interpretation of the First Schedule of 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." Insertion of this Explanation inevitably means that interpretation of First Schedule of Customs Tariff along with its Section that Chapter Notes are borrowed for interpretation and classification of goods under GST Law. 5.2 Hearing aids and parts and accessories of hearing aids find place in Chapter 90 to the Customs Tariff Act. As already stated above, hearing aids supplied by the Applicant are classifiable under HSN 9021 40 90. For classification of parts and accessories suitable for use solely with the hearin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tifications are at 4-digit HSN level and not at 8-digit HSN level. Therefore, we draw reference to the text of chapter heading 9021 of Customs Tariff for understanding 8-digit HSN level classification of parts and accessories. In this regard, Chapter heading 9021 and two specific tariff entries therein which are relevant are reproduced below: "HSN 9021: ORTHOPAEDIC APPLIANCES, INCLUDING CRUTCHES, SURGICAL BELTS AND TRUSSES; SPLINTS AND OTHER FRACTURE APPLIANCES; ARTIFICIAL PARTS OF THE BODY; HEARING AIDS AND OTHER APPLIANCES WHICH ARE WORN OR CARRIED, OR IMPLANTED IN THE BODY, ID COMPENSATE FOR A DEFECT OR DISABILITY: HSN 902140-Hearing aids, excluding parts and accessories: HSN 90214010: Frequency modulated hearing aid system used for hearing by handicapped persons in group situation HSN 90214090: Other HSN 902190-Other: HSN 90219010: Parts and accessories of hearing aids HSN 90219090: Other" 5.6 As can be seen above, parts and accessories of hearing aids are not mentioned in the text of the Chapter heading 9021. Since the parts and accessories supplied by the Applicant are suitable for use solely with the hearing aids, in terms of Note 2 (b) to Chapter 90, the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y with hearing aids also gets excluded from the ambit of SL. No. 221 (12% rate of tax). The Applicant considers that Si. No. 221 of 1/2017-CTR has no relevant to the case in hand. Parts and accessories having been excluded from Sl. No. 221 of 1/2017-CTR and by virtue of Chapter Note 2(b0 already discussed supra, finds a place under Sl. No. 142 of 2/2017-CTR which exempts hearing aids from GST. Since hearing aids is covered under Sl. No. 142 of 2/2017-CTR, and it does not exclude its parts and accessories from the said entry, the Applicant believes that parts and accessories are also covered under the said entry and are exempted from GST. 5.10 The above principle and understanding have been similarly clarified in Para 9 of Circular No. 113/ 32/2019-GST dt. 11.10.2019 (hereon referred to as 'Circular). The said Para clarifies regarding the classification of parts and accessories suitable for use solely with a medical device, which reads as under: "9. Applicability of GST on the parts and accessories suitable for use solely or principally with a medical device: 9.1 Representations have been received seeking clarification on applicability of GST on the parts of ophthalmic equipmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e for use solely with hearing aids) are exempt from GST and are covered under Sl. No. 142 of 2/2017-CTR. PERSONAL HEARING PROCEEDINGS HELD ON 22.06.2022 6. Sri Sandesh S Kunikar, Chartered Accountant & Authorised Representative of the applicant appeared for personal hearing proceedings and reiterated the facts narrated in their application. FINDINGS & DISCUSSION 7. At the outset we would like to make it clear that the provisions of CGST Act, 2017 and the KGST Act, 2017 are in pari-materia and have the same provisions in like matters and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the KGST Act. 8. We have considered the submissions made by the applicant in their application for advance ruling. We also considered the issues involved on which advance ruling is sought by the applicant and relevant facts along with the arguments made by the applicant & the submissions made by their learned representative during the time of hearing. 9. The applicant is engaged in the business of trading of hear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g 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. We also invite reference to the Customs Tariff Act 1975, Chapter subheading 9021 and relevant tariff entries therein which are as under: Tariff Item Description of goods 9021 ORTHOPAEDIC APPLIANCES, INCLUDING CRUTCHES, SURGICAL BELTS AND TRUSSES; SPLINTS AND OTHER FRACTURE APPLIANCES; ARTIFICIAL PARTS OF THE BODY; HEARING AIDS AND OTHER APPLIANCES WHICH ARE WORN OR CARRIED, OR IMPLANTED IN THE BODY, TO COMPENSATE FOR A DEFECT OR DISABILITY 9021 10 00 - Orthopeaedic or fracture appliances 9021 21 00 - Artificial teeth and dental fittings : 9021 29 00 -- Artificial teeth 9021 31 00 -- Other - Other Other artificial parts of the body : 9021 39 00 -- Artificial joints 9021 40 -- Other 9021 40 10 - Hearing aids, excluding parts and accessories: 9021 40 90 --- Frequency modulated hearing aid system used for hearing by handicapped persons in group situation 9021 50 00 --- Other 9021 90 - Pacemakers for stimulating heart muscles, excluding parts and accessories 9021 90 10 - Other : 9021 90 90 --- Pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s applicable to the instant case and Note 2(b) has to be considered in case Note 2(a) is not applicable. Thus the parts & accessories of hearing aids are rightly classifiable under heading 9021 9010. 16. The applicant sought to rely on the Circular No.113/32/2019-GST dated 11.10.2019, issued with regard to classification of parts of ophthalmic equipment. Clarification provided in the said circular is not relevant to the present facts of the case, in as much as there was no separate tariff heading/item for parts of ophthalmic equipment, where as in the instant case specific tariff heading 9021 9010 is mentioned for the parts and accessories of hearing aids. 17. Now we proceed to examine the applicability of entry number 142 of the Notification No.2/2017-Central Tax (Rate) dated 28.06.2017, which is as under: GOVERNMENT OF INDIA MINISTRY OF FINANCE (Department of Revenue) Notification No. 2/2017-Central Tax (Rate) New Delhi, the 28th June, 2017 G. S. R. (E).-In. exercise of the powers conferred by sub-section (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, being satisfied that it is necessary in the public interest so to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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