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TMI Blog2024 (10) TMI 494X X X X Extracts X X X X X X X X Extracts X X X X ..... fly ash content would not be applicable Fly Ash Bricks or Fly Ash Blocks and accordingly the rate of GST applicable to the products manufactured by petitioner would be 5% as per the Entry No. 225B. The orders passed by the Advance Ruling Authority and the Appellate Authority is set aside - petition allowed. - HONOURABLE MR. JUSTICE BHARGAV D. KARIA AND HONOURABLE MRS. JUSTICE MAUNA M. BHATT Appearance : For the Petitioner(s) No. 1: Aaditya D Bhatt (8580). For the Petitioner No. 1: Mr Sneh Purohit, Advocate. For the Petitioner(s) No. 1. Chandni S Joshi (9490). For the Respondent(s) No. 1: Mr Chintan Dave, AGP. For the Respondent(s) No. 3: Mr Hirak Shah, Advocate for Mr Nikunt K Raval (5558.) For the Respondent(s) No. 2: Served By Rpad (N). ORAL JUDGMENT (PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA) 1. Rule. Learned Assistant Government Pleader Mr. Chintan Dave waves service of notice of Rule on behalf of the respondent No. 1 State and learned advocate Mr. Hirak Shah for learned advocate Mr. Nikunt Raval waives service of notice of Rule on behalf of respondent No. 3. 2. By this petition under Article 226 of the Constitution of India the petitioner has prayed for the following rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturing and selling of Fly Ash Bricks and Fly Ash Blocks. According to the petitioner, the manufacturing process of Fly Ash Bricks is as under:- 3.1 Fly Ash Bricks are made using the waste of thermal power plants. The ash of burnt coal is used as an input, thus reinforcing the idea of turning waste into wealth. In India itself, the annual generation of fly ash is expected to be around 200 million tonnes. The subject goods were cleared after provisional assessment of the relevant Bills of Entry, pending test report of representative samples drawn from each of the consignment. 3.2 The petitioner is manufacturing Fly Ash Bricks from the mixer prepared of the following raw materials in desired proportion with the use of machinery by the petitioner: A Cement (5% to 20%) B Fly Ash (40% to 60%) C Sand (35% to 55%) D Lime (5% to 20%) E Water (As per requirement) 3.3 That the Fly Ash Bricks are standard size of the bricks ie. 230mm x 110mm x 70mm Fly Ash Bricks are sound, compact and uniform in shape, size and colour. Smooth rectangular surfaces of the bricks are accompanied with sharp and square corners. They are free from visible cracks, warpage, flaws and organic matter. They are Eco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the aforementioned prayers. 4. Learned advocate Mr. Aaditya Bhatt for the petitioner has submitted that the petitioner has explained in detail about the manufacturing process, however the same is not taken into consideration by the Advance Ruling Authority as well as the Appellate Authority to come to the conclusion that the Fly Ash Bricks manufactured by the petitioner does not contain 90% fly ash. 4.1 Learned advocate Mr. Bhatt further submitted that as per the notification issued by the Ministry of Environment and Forest dated 03.11.2009, minimum fly ash content for building material is prescribed in amendment made in Paragraph 1C of the said notification which provides that the bricks, blocks and tiles etc made with fly ash should contain 50% of the total input materials. It was therefore submitted that the reasoning given by the Advance Ruling Authority is contrary to the notification issued by the Ministry of Environment and Forest. 4.2 Learned advocate Mr. Bhatt further submitted that the Advance Ruling Authority and the Appellate Authority had wrongly applied the condition of 90% or more tiles content to the product in question to classify the same under Entry No. 453 in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vocate Mr. Nikunt Raval for the respondent submitted that in view of the notification No. 179/11/2022 dated 03.07.2022 the issue of levy of GST @ 18% could not survive as the applicable GST rate would be 5% on the Fly Ash Bricks manufactured by the petitioner. 5.1 In support of his submissions reliance was placed on the averments made in the affidavit-in-reply filed on behalf of the respondent wherein it is contended as under:- 6. With respect to contentions raised in para. B, it is submitted that the recommendation of the GST rates of Fly Ash Bricks in the 23rd GST Council as recommended by the committee, was 5% (2.5% CGST + 2.5% SGST). Thus, in respect of agenda item 6 (i), the Council decided to reduce the tax rate on fly ash bricks from 12% to 5%. The same recommendations are notified by virtue of any specific notification/ Circular/ orders vide Notification No. 41/2017 Central Tax dated 14.11.2017 to reduce the tax rate from 12% to 5% on fly ash bricks with 90% or more fly ash content (Sl. No. 225A). As the goods, i.e., Fly Ash Bricks supplied by the Appellant having only 40 to 60% of fly ash content, therefore the grounds for appeal before Hon'ble High Court of Gujarat ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, it is clarified that the condition of 90 per cent. or more fly ash content applied only to Fly Ash Aggregates and not to fly ash bricks and fly ash blocks. Further, with effect from 18th July, 2022 the condition is omitted from the description. 7. In view of above, the findings arrived by the Advance Ruling Authority would not be applicable in the facts of the case inasmuch as the Entry No. 176 of Schedule-II with description of goods as Fly Ash Bricks or Fly Ash Aggregate with 90% or more fly ash content and if Fly Ash Blocks attracts GST rate of 12% and therefore the confusion has arisen about the applicability of 90% condition of Fly Ash Aggregates and Fly Ash Bricks. The circular has clarified that as per recommendation of the GST Council in 23rd meeting the condition of 90% or more fly ash content was applicable only for Fly Ash Aggregate and accordingly it was clarified that 90% or more fly ash content applied only to Fly Ash Aggregate and not to Fly Ash Bricks and Fly Ash Blocks and w.e.f. 18.07.2022 the condition is omitted from the description. 8. Hence, in view of above clarification, as per the Notification No. 04/2018-Central Tax (Rate) dated 31.12.2018 Entry No. 22 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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