Fins Tube Heat Exchange Chapter 84

[Manish Sulakshane]

We wish you inform that we are manufacturers of Finned Tube Heat exchangers used in Refrigeration and Air Conditioning Industries.

In short we manufacturer Air Cooling Units called Evaporators and Condensers which are mainly used in assisting the change in the temperature of the Room. These are all Industrial Products used mainly in cold Storages, Dairies, Food Processing plants for maintaining the desired room temperature which are required for storing the products.

We sell our Products to the Cold Storage owners as well as Dairies whose are the end users and cannot take the set off the GST paid and its a cost to them as their services are exempted from from GST.

Prior to GST, when Excise was in force, we registered our Product under the Chapter heading 8418 6990 while our competitors registered their products under the chapter heading 8419 5090. Both the chapters attracted excise duty of 12.5%.

Subsequently, when GST came in force, we classified our products under 28% GST and so were our competitors. In the recent council meeting held on 9th & 10 November 2017, the GST Council has changed the GST of 8419 to 18% while our product has be retained at 28%.

Now due to change in the scenario, we are unable to sell our products to the end Customers by charging extra 10% GST on our Product which is an additional cost to the end user.

Can we also sell our Products mentioning the HSN Code 8419 against our products which we similar to our competitors.

You are request to kindly do let us have your valuable advice as how should be proceed.

[DR.MARIAPPAN GOVINDARAJAN]

In my view it can be done.

AI Summary

GST classification shift affects finned tube heat exchangers; advised that using competitor HSN code to obtain lower rate is possible. The manufacturer of finned tube heat exchangers supplies end users who cannot claim input tax credit and faces a higher GST rate due to its products being classified under a different HSN heading than competitors. The specific question is whether the manufacturer may list its goods under the competitor's HSN heading to obtain the lower GST rate; the respondent's view is that this course of action can be taken.