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TMI Blog2024 (2) TMI 1052X X X X Extracts X X X X X X X X Extracts X X X X ..... riateness for placement within this specific classification. This thorough assessment facilitates a nuanced understanding of the produces nature and contributes to Its compliance with regulatory standards. - SRI. K. RAVI SANKAR, AND SRI. B. LAKSHMI NARAYANA, IRS, MEMBER Represented by : R. Kushal Choudhary ORDER (Under sub-section (4) of Section 98 of Central Goods and Services Tax Act, 2017 and sub-section (4) of Section 98 of Andhra Pradesh Goods and Services Tax Act, 2017) 1. At the outset we would like to make it clear that the provisions of CGST Act, 2017 and SGST Act, 2017 are in pari materia and have the same provisions in like matter 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 APGST Act. 2. The present application has been filed u/s 97 of the Central Goods Services Tax Act, 2017 and AP Goods Services Tax Act, 2017 (hereinafter referred to CGST Act and APGST Act respectively) by M/s. Zuari Farmhub Limited (hereinafter referred to as applicant), reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed before the authority: The applicant seeks advance ruling on the following: 1. Whether the products referred supra i.e., Mangala Borosan and Mangala G1 are Classifiable under Chapter Heading 3105 as Fertilisers? 2. If the answer to the question no. 1 is in negative, what would be the appropriate? Classification of the said micronutrient Fertilisers? On Verification of basic information of the applicant, it is observed that the applicant is under State jurisdiction i.e, Autonagar Circle, Vijayawada-II Division. Accordingly, the application has been forwarded to the jurisdictional officer and a copy marked to the Central Tax authorities to offer their remarks as per Sec. 98(1) of CGST /APGST Act 2017. In response, remarks are received from the Central jurisdictional officer concerned stating that no proceedings lying pending with the issue, for which the advance ruling sought by the applicant. 5. Applicant's Interpretation of Law: Applicant's submissions are broadly summarised based on the following: A. Products in question (Mangala Borosan and Mangala G1) are nothing but Fertilisers. B. Most appropriate classification of the Fer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said the products in question are nothing but fertilisers . B. Most appropriate classification of Fertilisers will be under chapter 31 of the First Schedule to The Customs Tariff Act, 1975. 1.6. At the outset, the Applicant invites attention to the provisions of Chapter 31 to the First Schedule to the Customs Tariff Act, 1975, which prescribes for the classification of Fertilisers . Further, relevant entry that provides for mineral or chemical Fertilisers (including other Fertilisers) is 3105. The relevant extract from Chapter 31 is reproduced hereunder: HSN Disclosures 3105 Mineral or chemical fertilisers containing two or three of the fertilising elements nitrogen, phosphorus and potassium; other fertilisers ; goods of this chapter in tablets or similar forms or in packages of a gross weight not exceeding 10 kg 310590 - Other 3105 90 90 --- Other 1.7. Further, in the scheme of classification i.e., First Schedule to Customs Tariff Act, 1975, where classification of Fertilisers i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accepted by various tribunal decisions, which confirms that micronutrients used as Fertilisers are classifiable under Chapter 31 and in specific 3105 9090. Details of ruling along with relevant extracts is provided below for immediate reference: (a) In the case of CIBA India Ltd. Versus Commissioner of Customs, Chennai - 2009 (237) E.L.T. 207 (Tri. -Chennai); (b) Commissioner of Customs, Chennai Versus SLV Fertichem 2018 (363) E.L.T 847 (Tri. -Chennai). 1.8. Relevant extract of the ruling referred in (a) supra is as below: ..The imported item contains Ethylene Diamine Tetraacetic Acid (EDTA) which is a chelating agent and also contains nitrogen, zinc, manganese and iron. There is no dispute that it is used as a fertilizer. As per Note 6 to Chapter 31 of the CETA, 1985, the term other fertilizers applies only to products of a kind used as fertilizers containing, as an essential constituent (emphasis applied) at least one of the fertilizing elements nitrogen, phosphorous or potassium. The department has relied upon clarification issued by the Regional Fertilizer Control Laboratory, Chennai under cover of letters dated 30-10-2006 and 4-1-2007 that the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which provides for classification of chemical products and preparations of chemical industry or allied industries is also considered in various fora. The relevant extract from Chapter 38 is reproduced hereunder: 1.11. HSN Disclosures 3824 Prepared binders for foundry moulds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included 38249 -Other 3824 99 00 --Other 1.12. Given the extract, it is identifiable that the said Chapter is providing a miscellaneous/generic description of all mixtures which are not classifiable under any other chapter. As stated supra from Para 2.1 to 2.9 the products in question are clearly classifiable under Chapter 31, specifically under 3105 90 90 and hence resort to Chapter 38 and in specific heading 3824 would be incorrect and inappropriate. 1.13. The above is further justified by reading Rule 3(a) of General Rules of Interpretation of First ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or IGST 18%) 2.2. From the above table, two things emerge i.e., chemicals or minerals used as Fertilisers, will be classified under Schedule I to the Notification No. 01/2017 - Central Tax (Rate) dated 28.06.2017 read with relevant State Rate Notification and taxable at 5% GST. Whereas, if such chemicals or minerals cannot be used as Fertilisers, then such items will be classified under Schedule Ill to the said notifications and taxable at the rate of 18% GST. 2.3. In this backdrop, where Applicant's products sold and used, as Fertilisers, in agriculture, the said products will be classifiable under Schedule I to the above referred Notifications and taxable at the rate of 5% GST. The applicant additional submission: The applicant are subsidiary of Zuari Agro Chemicals Limited, an Adventz Group Group, involved in trading and marketing of chemicals fertilisers, water soluble fertilisers, seeds, pesticides and supply of allied services, all used in agriculture. The Applicant operates from 23 States/UTs in India. Alternate classification would be Chapter 28 as Micronutrients- To reiterate, we submit that the most appropriate classification of the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvance ruling is sought by the applicant and the relevant facts along with arguments made by the applicant and also their submissions made during the time of the personal hearing. Basing on the above minute details, the following point emerges: Upon scrutiny of the subject product, it is imperative to highlight its divergence from the category of micronutrient blends. Rather, its composition is distinctly characterized by a fusion of inorganic chemicals. The subject product doesn't fall under the category of Micronutrients, which are covered under serial number 1 (g) of Schedule 1, Part (A) of the Fertilizer Control Order, 1985. The distinctive attribute serves as the basis for its categorization under Tariff Item 28332990, a classification substantiated by findings in pertinent literature. The prevailing evidence strongly indicates that the product's primary essence resides in its sulphate composition. The determination to classify the product under 28332990 is fortified by a meticulous examination of relevant scholarly works. In contrast to its characterization as a blend of micronutrients, the product unequivocally comprises inorganic chemicals. This classificat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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