Classification of Aluminium Composite Panel/Sheet under HSN Code 7606 and Applicable Tax Rate Determination

The case involved the classification of Aluminium Composite Panel/Sheet under the appropriate HSN Code and the determination of the applicable tax rate under the SGST and CGST Acts. The authority ruled that the ACP Sheets should be classified under HSN Code 7606, which covers aluminium plates, sheets, and strips. Consequently, the applicable tax rate for the ACP Sheets under both the SGST Act and the CGST Act is 18%, with 9% each under CGST and SGST.

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Issues Involved:
1. Classification of Aluminium Composite Panel/Sheet under appropriate HSN Code.
2. Determination of the applicable rate of tax under SGST and CGST Acts.

Issue-wise Detailed Analysis:

1. Classification of Aluminium Composite Panel/Sheet under appropriate HSN Code:

The applicant, M/s. Aludecor Lamination Private Limited, sought to determine whether their product, Aluminium Composite Panel/Sheet (ACP Sheets), should be classified under HSN Code 3920, 7606, or 7610. The ACP Sheets are described as "Plastic sheet laminated with Aluminium Sheets," consisting of a non-toxic polythene core laminated with thin aluminium sheets on both sides.

The jurisdictional officer submitted that the ACP Sheets should be classified under HSN Code 7606, which covers "Aluminium plates, sheets and strip, of a thickness exceeding 0.2 mm," and carries a tax rate of 18%. The officer argued that HSN Code 3920 pertains to plastic sheets not reinforced or laminated with other materials, which does not apply to ACP Sheets as they are laminated with aluminium. HSN Code 7610 pertains to aluminium structures and parts thereof, which also does not fit the description of ACP Sheets.

The authority reviewed the manufacturing process and use cases of the ACP Sheets, noting that the product is used in various industries such as construction, railways, signage, shipbuilding, furniture, and automobiles. The essential user characteristics of the product, such as protection from heat and water, are attributed to the aluminium lamination rather than the plastic core.

The authority referred to the decision in Commissioner of Customs (Imports), Chennai vs. ICP India Pvt. Ltd (2018), where it was held that similar products are classified under HSN Code 7606. The authority concluded that the ACP Sheets should be classified under HSN Code 7606, as they are primarily aluminium products with a thickness exceeding 0.2 mm.

2. Determination of the applicable rate of tax under SGST and CGST Acts:

The applicant also sought clarification on the applicable rate of tax for ACP Sheets under the SGST and CGST Acts. The jurisdictional officer and the authority both confirmed that the tax rate for products classified under HSN Code 7606 is 18%, with 9% each under CGST and SGST.

Conclusion:

The authority ruled that the Aluminium Composite Panel/Sheet is covered under HSN Code 7606. Consequently, the applicable rate of tax for the ACP Sheets under both the SGST Act and the CGST Act is 18% (9% each under CGST and SGST).

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