Classification and GST Rate for Concrete Additive under Tariff Item 3824 40

The case involved determining the classification and applicable GST rate for a product used in concrete applications. The product was classified under Tariff Item 3824 40 as a prepared additive for cements, mortars, or concretes. The applicable GST rate for the product was determined to be 18% (9% CGST + 9% WBGST) under Notification No. 1/2017-Central Tax (Rate). The ruling remained valid unless declared void under Section 104(1) of the GST Act.

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Issues Involved:
1. Classification of the product under the appropriate HSN Code.
2. Applicable rate of GST on the product.

Issue-Wise Detailed Analysis:

1. Classification of the Product under the Appropriate HSN Code:
The applicant sought an advance ruling to determine the HSN Code and applicable tax rate for the supply of aerobic micro-organism/protein derived thereof used as a biological agent to reduce the requirement of cement in all cementitious/concrete applications.

Applicant's Submission:
- The applicant manufactures aerobic micro-organism/protein that reduces cement requirements in concrete applications.
- The product undergoes a series of processes including culturing, centrifugation, and mixing with silica powder.
- The applicant argued that the product should be classified under chapter sub-heading 3101.00 of the heading 3101, similar to bio-fertilizers or organic manure, as per previous rulings in the cases of M/s. Rhizo Organic and M/s. Elefo Biotech Pvt. Ltd.

Revenue's Submission:
- The revenue officer suggested that the product should be classified under HSN Code 3002 90 30, which covers "Cultures of micro-organisms (excluding yeast)" and attracts a GST rate of 12%.

Authority's Observations:
- The Authority noted that the product is neither a bio-fertilizer nor organic manure, distinguishing it from the cases cited by the applicant.
- The Authority also rejected the revenue's classification under HSN Code 3002 90 30, as the product does not fall under "Pharmaceutical products."

Final Classification:
- The product is identified as an additive used in concrete technology for enhancing strength and durability and imparting self-healing properties.
- The appropriate classification for the product is under Tariff Item 3824 40, which covers "Prepared additives for cements, mortars or concretes."

2. Applicable Rate of GST on the Product:
Authority's Findings:
- The product, classified under HSN 3824 40, falls under entry serial number 97 of Schedule-III of Notification No. 1/2017-Central Tax (Rate) dated 28-6-2017 and corresponding W.B. State Tax Notification No. 1125 F.T. dated 28.06.2017.
- The applicable GST rate for the product is 18% (9% CGST + 9% WBGST).

Ruling:
- The product, aerobic micro-organism/protein derived thereof used as a biological agent to reduce the requirement of cement in all cementitious/concrete applications, is classified under HSN 3824 40.
- The applicable GST rate is 18% (9% CGST + 9% WBGST).

This ruling is valid subject to the provisions under Section 103 until declared void under Section 104(1) of the GST Act.

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