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TMI Blog2021 (6) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... itely not made of base metal nor it has a working edge as required of a tool under this Chapter and therefore the applicant's product by no stretch of imagination could be classified under Chapter 8201, as claimed by the applicant. Classification under a Heading is to be governed only by the relevant Tariff-entries, Heading-description, etc. Heading 8201, does not envisage that all items used in an agriculture field would be covered therein. The instant product can also not be classified under 8201 as Hand tools, such as spades, shovels, mattocks, picks, hoes, forks and rakes; axes, bill hooks and similar hewing tools; secateurs and pruners of any kind; scythes, sickles, hay knives, hedge shears, timber wedges and other tools of a kind used in agriculture, horticulture or forestry - The impugned product is purely a support made of bamboo for creeper vegetables/ crops. Thus the conclusion that the applicant is not eligible for exemption from tax on the said waterproof Trellis support for climbing plants using Bamboo and High-Density Polyethylene', provided under Notification no. 2/2017-Central Tax (Rate), dated 28-6-2017. Section II CHAPTER 14 of Customs Tariff covers Veg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ress caused due to pulling. High-Density Polyethylene protects the encased bamboo material from rapid weathering, thus taking advantage of both that is the strength and tensile strength of bamboo and the rugged nature of HDPE respectively. The design has been equipped with a ground anchor to hold the structure steadily into the ground. The ground anchor is made using Nylon 66 plastic which provides great strength and ensures that there is no rotting. The ground anchor has a self-drilling mechanism to make the installation and used of this design of trellis support easy and weather friendly due to its pressure bearing capacity. 2.2 The applicant has also submitted that Garden vegetables and fruits can produce much higher yields when they are allowed to reach the plants' maximum height. For example, tomatoes, cucumbers, pole beans, squashes and many other vegetables may grow up to heights exceeding 8-10 feet and, in turn, will produce fruit proportionally. Although support devices for garden vegetables are well known, current devices in the market do not provide the area to support plants to this height, nor can these devices typically accommodate multiple plants on the same s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their aforesaid product named ''Waterproof Trellis support for climbing plants manufactured by using bamboo and High-Density Polyethylene . 3. Contentions of the applicant:- 3.1 That, as per Notification No. 2/2017-Central Tax (Rate) dated 28th June, 2017, Sr.No. 137 (HSN 8201) Agricultural implements manually operated or animal driven i.e. Hand tools, such as spades, shovels, mattocks, picks, hoes, forks and rakes; axes, bill hooks and similar hewing tools; secateurs and pruners of any kind: scythes, sickles, hay knives, hedge shears, timber wedges and other tools of a kind used in agriculture, horticulture or forestry other than ghamella has been exempted. 3.2 Accordingly, in view of the above, applicant's claim is that their aforesaid product viz. waterproof Trellis support for Climbing plants using bamboo and High-Density Polyethylene is a tool used in agriculture, horticulture or forestry and meriting classification under heading 8201 of Custom Tariff Act, 1975, attracting NIL rate of GST. 4. Personal Hearing:- Keeping with the established principles of natural justice, personal hearing in the matter was extended to the applicant in person, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us for determination is whether their product named 'waterproof Trellis support for climbing plants using Bamboo and High-Density Polyethylene' supra, falls under ''Tariff item / sub-heading / heading / Chapter 8201, eligible for exemption from GST as a tool used in agriculture, as claimed by the applicant. 5.3 For sake of reference, the text of aforesaid Notification no. 2/2017-Central Tax (Rate) dated 28th June, 2017 is reproduced here under:- 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 ft public interest so to do, on the recommendations of the Council, hereby exempts intro-State supplies of goods, the description of which is specified in column (3) of the Schedule appended to this notification, falling under the tariff item, sub-heading, heading or Chapter, as the case may be, as specified in the corresponding entry in column (2) of the said Schedule, from the whole of the Central tax leviable thereon under Section 9 of the Central Goods and Services Tax Act, 2017 (12 of 2017). SCHEDULE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d High-Density Polyethylene', is bamboo treated with High density polyethylene solely with an aim to make it resistant to heat, light and water and other natural eventualities so as to enhance the life of this bamboo support to ensure the required sturdiness, preventing it from breaking or to make it break resistant. This treatment of bamboo avoids it from any impact due to climate change extending the life spans of the support by avoiding rotting at the grounded end. Besides this for easy installation of the poles, it has been equipped with a ground anchor which has a self-drilling mechanism to get the frame easily grounded for the plantation of climber plant. AM this is very well evident from the technical data about their product, as furnished by the applicant as discussed above. 5.5 It will also be not out of place to mention here that classification of goods for the purposes of GST is based on the entries in the First Schedule to the Customs Tariff Act, 1975. Also it is worth noting that, as per explanation (iii) and (iv) to Notification No. 2/2017-Central Tax (Rate), dated 28-6-2017 supra, tariff heading, sub-heading, heading and chapter shall mean respectively a tarif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8201 10 00 - Spades and shovels kg. 8201 30 00 - Mattocks, picks, hoes and rakes kg. 8201 40 00 - Axes, bill hooks and similar hewing tools kg. 8201 50 00 - Secateurs and similar one-handed pruners and shears (including poultry shears) kg. 8201 60 00 - Hedge shears, two-handed pruning shears and similar two-handed shears kg. 8201 90 00 - Other hand tools of a kind used in agriculture, horticulture or forestry kg. 5.7 On perusal of the above Section notes, Chapter Note and Chapter heading, it gets amply clear that 'Base metals and articles of base metals' are only covered under Section XV of the Customs Tariff Act. Further as per Section Note 3 'Base metals' means iron and steel, copper, nickel, al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plates, sticks, tips and the like, for tools (heading 82.09). .. Tools, cutlery, etc., do not in general fall in this Chapter unless the blade, working edge, working surface or other working part is of base metal, of metal carbides (see the Explanatory Note to heading 28.49) or of cermets (see the Explanatory Note to heading 81.13); provided, however, that this condition is met, they remain in the Chapter even if fitted with non-metallic handles, bodies, etc., of a weight exceeding that of the metallic working part, (e.g., a wooden plane with a metal blade). The Chapter also, however, includes tools if the working part is of natural, synthetic or reconstructed precious or semi-precious stones (e.g., black diamonds) fitted onto a support of base metal, metal, carbides or cermets; further, in certain cases, the working part may be of base metal fitted or covered with abrasive materials. There are exceptions to these general rules in the case of certain articles specifically mentioned in the headings (e.g., portable forges and grinding wheels with frameworks). Moreover, very few abrasive tools remain in the scope of the Chapter (see the Explanatory Notes to hea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der this Chapter and therefore the applicant's product by no stretch of imagination could be classified under Chapter 8201, as claimed by the applicant. Classification under a Heading is to be governed only by the relevant Tariff-entries, Heading-description, etc. Heading 8201, does not envisage that all items used in an agriculture field would be covered therein. The instant product can also not be classified under 8201 as Hand tools, such as spades, shovels, mattocks, picks, hoes, forks and rakes; axes, bill hooks and similar hewing tools; secateurs and pruners of any kind; scythes, sickles, hay knives, hedge shears, timber wedges and other tools of a kind used in agriculture, horticulture or forestry. We find no rationale in the opinion put forth by the applicant in as much as, assuming but not acceding if the said interpretation of applicant is considered then even the wire fence used for a boundary in agricultural field would also qualify being termed as agricultural tool/ implements. The impugned product is purely a support made of bamboo for creeper vegetables/ crops. Thus we come to the conclusion that the applicant is not eligible for exemption from tax on the said wat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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