2019 (11) TMI 421 - AAAR - GST

Appellate ruling on Tata Harrier's ground clearance for Cess rates under Tariff Item 8703

The Appellate Authority set aside the Advance Ruling Authority's classification of Tata Harrier under Tariff Item 8703 32 91 and ruled that for the ... Measurement of ground clearance in laden condition - application of Indian Standard IS-9435 for measurement of vehicle dimensions - reference to statutes in pari materia for interpretative aid - role of ARAI certification and Central Motor Vehicles Rules in determining vehicle specificationsMeasurement of ground clearance in laden condition - application of Indian Standard IS-9435 for measurement of vehicle dimensions - role of ARAI certification and Central Motor Vehicles Rules in determining vehicle specifications - Ground clearance specified in the Explanation to Sr. No. 52B of the Cess Rate Notification is to be measured in laden condition. - HELD THAT: - The term 'ground clearance' is not defined in the GST / Compensation Cess enactments; therefore the authority applied the doctrine of reference to statutes in pari materia and looked to the Central Motor Vehicles Act, 1988 and the rules thereunder and the Indian Standard IS-9435. Clause 5.8 of IS-9435 expressly provides that the measurement of minimum ground clearance 'has to be done on fully laden vehicle to the maximum authorized GVW.' ARAI, the prescribed testing authority under section 56 of the Motor Vehicles Act, certifies vehicle dimensions in accordance with IS-9435. Given that the Cess Rate Notification does not prescribe a methodology for measuring ground clearance and that vehicle certification and dimension standards are governed by the Motor Vehicles regime and IS-9435, the correct legal conclusion is that ground clearance for the purpose of Sr. No. 52B must be determined in the laden state. The Advance Ruling Authority's contrary view - that unladen measurement should be used because passenger weight varies - was rejected as inconsistent with established standards and relevant precedents applying standardized passenger weight for payload calculations. [Paras 19, 20, 21, 23, 24]Ground clearance for Sr. No. 52B must be measured in laden condition.Measurement of ground clearance in laden condition - application of Indian Standard IS-9435 for measurement of vehicle dimensions - A vehicle whose ground clearance is more than 170 mm in unladen condition but below 170 mm in laden condition does not fall within Sr. No. 52B of the Cess Rate Notification. - HELD THAT: - Because the regulatory standard (IS-9435) requires measurement of ground clearance in the fully laden state and the Cess Rate Notification's Explanation incorporates ground clearance as a qualifying parameter, the qualifying threshold of 170 mm must be satisfied in the laden condition. Consequently, a vehicle meeting the 170 mm threshold only in the unladen state but falling below it when measured laden does not satisfy the Explanation and therefore is not classifiable under Sr. No. 52B. [Paras 20, 21, 24]Vehicle with unladen >170 mm but laden