9911796707
TMI Blog2023 (5) TMI 125X X X X Extracts X X X X X X X X Extracts X X X X ..... polyethylene. The ACPs are sandwich panels comprising two aluminium sheets bonded to a non-aluminium core. Therefore the ACPs should be classified as if they consisted of the material or component which gives them their essential character i.e. Aluminium in the present case and not the polythene core which binds the both Aluminium panels in the ACPs. The goods made by applicant is not a structure or part of a structure. The goods at the time of manufacture are in the form of sheets of various dimensions/measurements. As declared by the applicant, the same has to be further cut to different size and shape depending on the shape and size of the structure as the ACPs made are not ready to be used as it is, but the same requires cutting, routing, drilling; etc. process and only then they can be used in structure or fabrication or as the case may be. Thus, the goods made by him are not ready to use in the form in which they are made but needs further processing such as cutting, grooving/routing, bending etc. before being put to use. Therefore, it cannot be said that the impugned goods in the form in which it is presented are prepared for use in structure . Thus, the claim of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the applicant is called as Aluminium Composite Panel , often it is called as Sandwich Panel or ACP Sheet . The same is manufactured in 4 width (Fixed) and length of 89, 10* or 12 as required by the purchases. In fact the product is Plastic sheet laminated with Aluminium Sheets . If recycled plastic is used in manufacturing, it can be said to be Re-cycled plastic Aluminium Composite Panel Sheet . Aluminium composite panels are sandwiched type panel consisting of Nontoxic polythene core firmly laminated with thin Aluminium sheet on top and bottom (One Side affixed with adhesive polythene film for protection) and are being used as Industrial Product. The dealer has manufacturing unit of at Haridwar. 3. The applicant procures the ACP Sheets from his factory situated in Uttarakhand or from the other plivalgs of business situated in India as branch transfer and sells the same in Maharashtra. Once the applicant has imported the same product from out of India and the documents relating to import also says that the product is covered under CETH 3920. 4. In fact the product is Plastic sheet laminated with Aluminium Foils . If re cycled plastic is used in manufacturing, it can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nting and like purpose by the builders and on tractors engaged in works contract. Form the sheets by drilling, routing, cutting and other process components, parts are prepared for use in construction /structure. (2) In Railways in coach building (3) In signage Industries for manufacturing of advertisement boards, name boards etc. (4) In passenger ship building industries, (5) In manufacturing of Furniture and Fixture, (6) In automobile Industries in manufacturing of passenger motor vehicles, (7) In interior decoration, (8) In construction of pedestrian bridges etc. This is not ready to be used as it is, but the same requires cutting, routing, drilling; etc. process and then can be used in structure or fabrication or as the case may be. II. Statement containing the applicant s interpretation of law based on the facts, in respect of the aforesaid questions: 1. In VAT Period, the applicant use to sell the product under Central Excise Tariff Heading (CETH) 3920, after DDQ in the matter of Kevin Enterprises and others under CETH 7606. Commissioner of Sales Tax, Maharashtra while deciding the issue of rate of tax held the same product falling under CETH 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isement material, small samples of the product sold by the applicant, photographs and video describing manufacturing process etc. in following order; 1988, and that cotton fabric based laminates are classifiable under Heading 3922 90 till February 28, 1988 and under Heading 3926.90 on and after March 1, 1988. As regards paper based insulators it was held that same are classifiable under Heading 8546.00. In taking the said view the Tribunal has followed its earlier judgments in Amit Polymers Composited Ltd., Hyderabad v. CCE Hyderabad, 1989 (20) ECR 454, and M/s Meghdoor Laminate Pvt. Ltd. v. CCE Ahmedabad, Order Nos, 553 to 572/89 dated September 29, 1989. As regards paper based insulators the Tribunal has placed reliance on its decision in CCE Ahmedabad vs Metro Wood Engineering Works, 1989 (22) ECR 369. Civil Appeals Nos. 1852-53 of 1991 have been filed by the Revenue against the said judgment of the Tribunal. III. ISSUES REQUIRING ADVANCE RULING: 1. The applicant submits the following questions for Advance Ruling and their interpretation on the questions as under: 1. Whether Aluminium composite penal/sheet is covered under HSN 3920 or HSN 7610 or HSN 7606? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laminated, supported or similarly combined with other materials. As seen from the above narration in Chapter 39 of the GST Tariff, it pertains to Plastics and articles thereof. Chapter 3920 covers other plates, sheets, film, foil, tape strip, of plastics, non-cellular and not reinforced, laminated, supported or similarly combined with other materials. The applicant has clearly stated that the product sold by them is Plastic sheet laminated with Aluminium Sheets ; it is clear from the reading of Tariff Heading 3920 that the impugned products, being plastic sheets laminated with aluminium sheets, are not covered under Tariff Heading 3920. Alternative tariff headings proposed by the applicant before the Authority for Advance Ruling are 7606 and 7610. The tariff Heading 7610 covers: Aluminium structures (excluding prefabricated buildings of heading 9406) and parts of structures (for example, bridges and bridge sections, towers, lattice masts, roofs, roofing frameworks, doors and windows and their frames and thresholds for doors, balustrades, pillars and columns); aluminum plates, rods, profiles, tubes and the like, prepared for use in structures. According to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as aluminium plate. However the commodity produced by the applicant contains both aluminium plates as well as plastic sheet which are in extricably bound with each other by a process of manufacture after the aluminium plates as well as the plastic sheets have come into existence in an anterior manufacturing process and are only raw materials in the production of the Composite Panels . As seen from the ACP product information, the respective weight of aluminium and plastic are in the ratio of maximum 2.75 kgs per m2 of aluminium to maximum 5.75 kgs per m2 of plastic. Therefore the commodity is neither plastic nor aluminium wholly. The new commodity which came into existence as a result of manufacturing process cannot be classified either as plastic or aluminium based on the substance/substances from which it has been made. It is a new commodity having specified uses and therefore a separate marketability. Hence this is a commodity which is not specified in Schedule I, II, IV, V or VI of the Notification No. 01/2017 dt. 28.06.2017 and hence would fall in residuary entry at Serial No. 453 of Schedule III and attract the tax at the rate of 9% CGST 9% SGST each. The facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f goods specified in Schedule I, (ii) 6 per cent. in respect of goods specified in Schedule II, (iii) 9 per cent. in respect of goods specified in Schedule III, (iv) 14 per cent. in respect of goods specified in Schedule IV, (v) 1.5 per cent. in respect of goods specified in Schedule V, and (vi) 0.125 per cent. in respect of goods specified in Schedule VI appended to this notification (hereinafter referred to as the said Schedules), that shall be levied on intra-State supplies of goods, the description of which is specified in the corresponding entry in column (3) of the said Schedules, falling under the tariff item, subheading, heading or Chapter, as the case may be, as specified in the corresponding entry in column (2) of the said Schedules. Tariff item , sub-heading heading and Chapter 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). 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 2 of the CUSTOMS TARIFF ACT, 1975 Duties specified in the Schedules to be levied . The rates at which duties of customs shall be levied under the Customs Act, 1962 (52 of 1962), are specified in the First and Second Schedules. 7. Rule 3(b) of the General Rules for the interpretation of the Customs Import Tariff Schedule states Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to (a), shall be classified as if they consisted of the material or component which gives them their essential character, in so far as this criterion is applicable. 8. Therefore the mixtures, composite goods and sets that cannot be classified by use of the previous Rules should be classified as if they consisted of the material or component which gives them their essential character. 9. As per the relevant provisions under Section 3 of the CUSTOMS TARIFF ACT, 1975, the Rule 3(b) of the General Rules for the interpretation of the Customs Import Tariff Schedule also applies for determination of the applicable IGST rate on the Goods. 10. As the rules for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nderstood with reference to the aluminium sheets. This panel is used to improve water resistance, heat resistance, dust repelling property etc. of a building as also to impart an aesthetic appeal to it. By no stretch of imagination can it be said that these purposes would be attained by the polyethylene sandwiched between the aluminium sheets. The essential character test is, therefore, to be undertaken by considering the aluminium component of the goods in question. Classification of any composite material has to be determined on the basis of its essential character rather than the percentage of components thereof. 14. Hon ble Supreme Court of India in the case of State of Tamil Nadu Vs Pyare Lal Malhotra and Ors. AIR 1976 SC 800 held that where commercial goods, without change of their identity as such goods, are merely subjected to some processing or finishing or are merely jointed together, they may remain commercially the same goods, so long as they retain their identity as goods of a particular type. 15. The applicant has submitted that Aluminium composite panels (impugned goods) are sandwiched type panel consisting of Nontoxic polythene core firmly laminated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d size of the structure as the ACPs made are not ready to be used as it is, but the same requires cutting, routing, drilling; etc. process and only then they can be used in structure or fabrication or as the case may be. Thus, the goods made by him are not ready to use in the form in which they are made but needs further processing such as cutting, grooving/routing, bending etc. before being put to use. Therefore, it cannot be said that the impugned goods in the form in which it is presented are prepared for use in structure . Thus, the claim of the applicant to classify the said goods under CTH 7610 is not correct. 21. It is found that the subject product is covered by the decision of the Hon ble Tribunal in the case of Commissioner of Customs (Imports), Chennai versus ICP India Pvt. Ltd 2018 (7) TMI 546 CESTAT Chennai . The Hon ble Tribunal observed as follows:- The Ld.Counsel has produced a sample plate of the impugned goods(ACPs) before us. It is in the form of a sheet and definitely is not a structure, or part of structure falling under 7610. It cannot be used as structure or part of structure and is only plates that are generally used for cladding the surfaces. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is covered under Heading 7606 of the GST Tariff and the rate of GST on the impugned product is 18% (9% each under CGST and SGST). 27. The applicant has submitted a few case laws in their application but most of the referred case laws are not applicable in the instant case because the facts of the matter in the said case laws are different from the matter at hand. In view of the above discussions, the question raised by the applicant is clarified as per the below ruling: Questions Ruling 1. Whether Aluminium composite panel/sheet is covered under HSN 3920 or HSN 7610 or HSN 7606? As the Aluminium Composite Panel/Sheet attribute most of its characteristics to the two aluminium sheets from which it is made, the ACP has to be classified under the tariff heading 7606 as per Rule 3(b) of the General Rules for the interpretation of the Customs Import Tariff Schedule read with Notification No.1/2017-Central Tax (Rate) dated 28th June,2017. 2. Rate of SGST and CGST applicable on the same. 9% SGST and 9% CGST Referring the application to Appellate Aut ..... X X X X Extracts X X X X X X X X Extracts X X X X
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