Classification of partially coated polyester fabric under HSN 5903 by AAR

The Authority for Advance Ruling (AAR) determined that the partially coated polyester fabric in question should be classified under HSN 5903, aligning with the guidelines set forth in the Explanatory Notes to HSN 5903. This decision was based on the fabric's characteristics and manufacturing process, despite the applicant's arguments for alternative classifications. The ruling emphasized that advance rulings are binding solely on the applicant and the relevant officer, affirming the correct classification of the fabric under HSN 5903.

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Issues Involved:
1. Classification of partially coated polyester fabric under relevant chapter headings (50 to 55, 58 or 60) or under Tariff Heading 5903.

Issue-wise Detailed Analysis:

Issue 1: Classification of Partially Coated Polyester Fabric

Applicant's Submission:
M/s. Supercoat India supplies partially coated polyester fabric used as interlining fabric in garments. The fabric undergoes a micro-dot coating process using specific chemicals and machinery, resulting in a product partially coated on one side with scattered dots. The applicant argues that this product should not be classified under heading 5903 of the Customs Tariff Act, 1975, which deals with impregnated, coated, covered, or laminated textile fabrics. Instead, they believe it should fall under chapter headings 50 to 55, 58, or 60, specifically under chapter 54 due to the synthetic nature of the polyester fabric.

Applicant's Arguments:
1. The coating on the fabric is visible to the naked eye.
2. The fabric can be bent manually without fracturing.
3. The fabric is not completely embedded in plastic nor coated on both sides.
4. The product does not fall under heading 5811, which covers quilted textile products.
5. The fabric is partially coated and used for interlining, which does not make it impervious.

Revenue's Submission:
The Revenue contends that as per Chapter Note 2 of the Customs Tariff Act, 1975, textile fabrics impregnated, coated, covered, or laminated with plastics are covered under heading 5903.

Findings:
The Authority for Advance Ruling (AAR) examined the applicability of HSN 5903, which covers textile fabrics impregnated, coated, covered, or laminated with plastics. The key points considered were:
1. The coating on the fabric is visible to the naked eye.
2. The fabric can be bent manually around a cylinder of 7 mm diameter without fracturing.
3. The fabric is not completely embedded in plastics nor coated on both sides.
4. The fabric is partially coated on one side with scattered dots, used for interlining by applying heat and pressure.

The AAR referred to the Explanatory Notes to HSN 5903 and found that the subject goods met all the specified conditions for classification under HSN 5903. The partially coated fabric is used as interlining fabric, with the coating visible to the naked eye and capable of bonding to other fabrics under heat and pressure.

Conclusion:
The AAR concluded that the subject goods, partially coated polyester fabric, are correctly classified under HSN 5903. The ruling was based on the detailed examination of the fabric's characteristics and the manufacturing process, aligning with the guidelines specified in the Explanatory Notes to HSN 5903. The applicant's reliance on previous rulings and circulars was noted, but the AAR emphasized that advance rulings are binding only on the applicant and the concerned officer.

Ruling:
The subject goods are classified at HSN 5903.

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