2019 (11) TMI 421 - AAAR - GST

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

In Re: M/s. Tata Motors Limited

In Re: M/s. Tata Motors Limited - 2019 (31) G.S.T.L. 544 (App. A. A. R. - GST) Issues Involved:1. Classification of Tata Harrier under the appropriate tariff item.2. Applicability of the conditions in the main clause and explanation of Sr. No. 52B of the Cess Rate Notification.3. Consideration of ground clearance in laden or unladen condition for the purpose of Cess Rate Notification.4. Applicability of GST Compensation Cess @ 22% to Tata Harrier.5. Condonation of delay in filing the appeal.Detailed Analysis:1. Classification of Tata Harrier:The Appellant, Tata Motors Limited, sought a ruling on whether Tata Harrier is classifiable under Tariff Item 8703 32 91 or 8703 32 99 of the First Schedule to the Customs Tariff Act, 1975. The Advance Ruling Authority (ARA) classified Tata Harrier under Tariff Item 8703 32 91.2. Applicability of Conditions in Sr. No. 52B of Cess Rate Notification:The Appellant questioned whether a vehicle must satisfy both the main clause and the conditions in the explanation (length exceeding 4000 mm and ground clearance of 170 mm and above) to be covered under Sr. No. 52B. The ARA ruled that the vehicle must satisfy both the main clause and the conditions mentioned in the explanation.3. Consideration of Ground Clearance:The core issue was whether the ground clearance for the purpose of Sr. No. 52B of the Cess Rate Notification should be considered in laden or unladen condition. The ARA ruled that ground clearance must be measured in the unladen condition. The Appellant argued that ground clearance should be measured in the laden condition, as per the standards set by the Automotive Research Association of India (ARAI) and Indian Standard IS-9435, which states that ground clearance should be measured in a fully laden vehicle to the maximum authorized Gross Vehicle Weight (GVW).4. Applicability of GST Compensation Cess @ 22%:Based on the ARA's ruling that Tata Harrier falls under Sr. No. 52B, the ARA concluded that GST Compensation Cess @ 22% is applicable to Tata Harrier.5. Condonation of Delay:The Appellant filed the appeal beyond the 30-day period stipulated under Section 100(2) of the CGST Act, 2017. The Appellant requested condonation of the 20-day delay, citing reasons such as being busy with financial year-end activities and technical glitches on the GST portal. The jurisdictional officer did not oppose this request. The Appellate Authority condoned the delay, allowing the appeal to be heard on merits.Appellate Authority's Findings:Ground Clearance Consideration:The Appellate Authority found that the term 'ground clearance' is not defined in the GST Law, including the GST (Compensation to States) Act, 2017. Therefore, they referred to the Central Motor Vehicles Act, 1988, and the rules made thereunder, which are in pari materia with the GST (Compensation to States) Act, 2017. As per IS-9435, ground clearance is to be measured in a fully laden state. The Appellate Authority concluded that the ARA's ruling to measure ground clearance in the unladen condition was arbitrary and ungrounded.Final Order:The Appellate Authority set aside the ARA's ruling and concluded:- For the purpose of Cess @ 22% under Sr. No. 52B of Cess Rate Notification, the ground clearance of the vehicle is to be considered in the laden condition only.- A vehicle whose ground clearance in the unladen condition is more than 170 mm but below 170 mm in the laden condition will not get covered under Sr. No. 52B of Cess Rate Notification.This comprehensive analysis ensures that the significant phrases and legal terminology from the original text are preserved, providing a thorough understanding of the judgment.