TaxTMI 
TaxTMI 
2018 (12) TMI 1276
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....mount of admissible input tax credit shall be made, unless the applicant or the appellant has been given an opportunity of being heard. 2. Under Section 103 (1) of the Act, this advance ruling pronounced by the Appellate Authority under Chapter XVII of the Act shall be binding only (a) On the applicant who had sought it in respect of any matter referred to in sub-Section (2) of Section 97 for advance ruling; (b) On the concerned officer or the jurisdictional officer in respect of the applicant. 3. Under Section 103 (2) of the Act, this advance ruling shall be binding unless the law, facts or circumstances supporting the original advance ruling have changed. 4. Under Section 104 (1) of the Act, where the Appellate Authority finds that advance ruling pronounced by it under sub-Section (l) of Section 101 has been obtained by the appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab-initio and thereupon all the provisions of this Act or the rules made thereunder shall apply to the appellant as if such advance ruling has never been made. ******* 1. The subject appeal has been filed unde....
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....mpugned goods"; and separately as "Mridaparikshak"/"Minilab" and "Refilling reagents" respectively. The appellants had stated that the impugned goods were used for determining / verifying soil health in terms of the parameters i.e., soil pH, Electrical Conductivity, Organic Carbon etc. The appellants claimed that the impugned goods were covered by the exemption entry at Sl.No.137 of Notification No. 2/2017 -Central Tax (Rate) dated 28-6-2017^1 which reads as follows: Sl. No. Chapter/Heading/Subheading/Tariff item Description of Goods Rate 137 Schedule- of Notification No.2/2017 Central Tax (Rate) 8201 Agricultural implements manually operated or animal driven i.e. Hand tools, such as spades, shovels, mattocks, picks, hoes, forks and rakes; axes, bill hooks and similar hewing tools; secateurs and pruners of any kind; scythes, sickles, hay knives, hedge shears, timber wedges and other tools of a kind used in agriculture, horticulture or forestry Nil The appellants contended that the Minilab and Refill Reagents were exclusively used for Agriculture and hence fall for consideration as "Agricultural implements" of Heading 8201 as mentioned in the above entry. ....
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....ompany. The hearing was accordingly adjourned. 6.2. At the next hearing held on 17-9-2018, Sri T.S.R. Murthy, Senior Research Officer (Technical person) of the company appeared, apart from the representatives of the appellant and Department, mentioned above. Both the parties filed written submissions; the appellants also submitted copies of certain documents viz., a leaflet of the item "Mridaparikshak", Operation manual/Working Protocol for "Mridaparikshak-Minilab", Soil Health Card apart from a compilation of case-laws relied upon by them. 6.3. Sri T.S.R. Murthy, the technical person explained the various aspects pertaining to the impugned goods including the nature, composition, functionality, method & manner of usage, form of supply etc. in detail, as follows: (a) He produced before the Bench the main equipment "Mridaparikshak" and explained that the product described as "Mridaparikshak - MiniLab for Agriculture Soil Testing" as per the tax invoice on page 29 of the appeal booklet is actually a set of things / instruments / items / reagents (which are as shown in the photograph / leaflet submitted by them), and that out of these various items they are now showing to the....
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....es of the various parameters, the system gives recommendation in terms of fertilizers needed by the farmers. (c) On further query from the Bench, he explained that some parameters such as pH, EC (Electrical Conductivity) and OC (Organic Carbon) are directly measured by the system whereas some others for example "Available Nitrogen" are thereafter internally calculated based on in-built logic/software. For example, the value of the parameter "Available nitrogen" is calculated on the basis of the measured "Organic Carbon". He explained that the details in this regard are given in the manual filed by them. With this, the technical person concluded his deposition. (d) The Counsel mentioned that though it is true that the item "Mridaparikshak" is measuring various parameters of the soil and in fact the name itself i.e, Mridaparikshak means 'tester of soil', but the fact remains that the item is working on soil, that the item is used for farmer, that the item is used for agriculture, and that therefore going by the end-use test it should be classified in Chapter 82 as 'Agriculture tools'. He also referred to the case laws which he has filed as per which the benefit of doubt should ....
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....ibid as held by the Adv. Ruling Authority ? (ii) Whether the goods viz., Refill Reagents merit classification under Heading 8201 of the Tariff as claimed by the appellant; or they are classifiable under Heading 9027 ibid as held by the Adv. Ruling Authority ? (iii) Whether the goods i.e, Mridaparikshak-Minilab as also the Refill Reagents are covered by the entry at Sl.No. 137 of Notification No. 2/201 7-Central Tax (Rate) dated 28-6-2017 with 'NIL' rate of tax as claimed by the appellant; or they are chargeable to 9 % CGST + 9 % SGST as per the impugned Order? 9. In order to determine the aforesaid questions, first the nature, usage etc. of the goods involved (hereinafter also referred to as "impugned goods") are to be considered, followed by the relevant Tariff entries and statutory provisions etc.; and thereafter, the applicability or otherwise of the exemption-Notification entry to the impugned goods. [Applicability/otherwise of the case-laws cited by appellant is dealt at appropriate places in the course of our discussion & findings]. 10. Details regarding the description, nature, functionality, usage etc. of the impugned goods are as available in the detailed recor....
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....rst supply of the Minilab includes the Reagents, while subsequent refills are supplied depending on requirement. 11.1. Under GST statute, levy / rates of tax in respect of supplies consisting of two or more supplies of goods, is governed by Section 8 of the Act read with the definitions of the terms "composite supply", "principal supply" and "mixed supply" as given in the Act. In the instant case, admittedly the Soil Testing Minilab consists of the main instrument along with various other accessories etc., as supplied. However, the aforesaid aspect of whether supply of Minilab is a composite supply or mixed supply, does not find any mention / discussion / examination in either the proceedings before the Adv. Ruling Authority or the impugned order nor also put forth before us, by either parties to the appeal. 11.2. As seen, the appellants had, in their initial application sought a single classification under Heading 8201 for the Agriculture Soil Testing Minilab as such (and not merely for the Mridaparikshak instrument) even though mentioning that the said Minilab comprises the main electronic instrument Mridaparikshak and also other items/accessories, which are supplied togeth....
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.... METALS AND ARTICLES OF BASE METAL Notes : 1. This Section does not cover : ........................ (i) instruments or apparatus of Section XVIII^5, including clock or watch springs; ........................ Chapter 82 Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal Notes : 1. Apart from blow lamps, portable forges, grinding wheels with frameworks, manicure or pedicure sets, and goods of heading 8209, this Chapter covers only articles with a blade, working edge, working surface or other working part of: (a) base metal; (b) metal carbides or cermets; (c) precious or semi-precious stones (natural, synthetic or reconstructed) on a support of base metal, metal carbide or cermet; or (d) abrasive materials on a support of base metal, provided that the articles have cutting teeth, flutes, grooves, or the like, of base metal, which retain their identity and function after the application of the abrasive. .............. Tariff Item Description Unit (1) (2) (3) 8201 HAND TOOLS, THE FOLLOWING: SPADES, SHOVELS, MATTOCKS , PICKS, HOES, FORKS AND RAKE....
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....sure meters); microtomes 9027 10 00 - Gas or smoke analysis apparatus u 9027 20 00 - Chromatographs and electrophoresis instruments u 9027 30 - Spectrometers, spectrophotometers and spectrographs using optical radiations (UV, visible, IR) : 9027 30 10 --- Spectrometers u 9027 30 20 --- Spectrophotometers u 9027 30 90 --- Other u 9027 50 - Other instruments and apparatus using optical radiations (UV, visible, IR) : 9027 50 10 --- Photometers u 9027 50 20 --- Refractometers u 9027 50 30 --- Polarimeters u 9027 50 90 --- Other u 9027 80 - Other instruments and apparatus: 9027 80 10 --- Viscometers u 9027 80 20 --- Calorimeters u 9027 80 30 --- Instruments and apparatus for measuring the surface or interfocial tension of liquids u 9027 80 40 --- Nuclear magnetic resonance instruments u 9027 80 90 --- Other u 9027 90 - Microtomes; parts and accessories : 9027 90 10 --- Microtomes, including parts and accessories t....
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....more complete or precise description of the goods. (b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to (a), shall be classified as if they consisted of the material or component which gives them their essential character, in so far as this criterion is applicable. (c) When goods cannot be classified by reference to (a) or (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration. 4. Goods which cannot be classified in accordance with the above rules shall be classified under the heading appropriate to the goods to which they are most akin". [Rules 5, 6, General Notes and Additional Notes are not reproduced since not relevant] 13.1. First, we deal with classification of the Mridaparikshak Minilab. On considering the nature, functions, usage etc. of the said Minilab vis-d-vis Heading 8201 claimed by appellant, the following position emerges: (i) Heading 8201 covers goods which are Hand-tools, of the types specifically enumerated thereunder i.e, 'Spades....
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....ed by the respondent. Shital International ".....14. There is no dispute that knitted pile fabrics are to be classified under heading No.60.01 of the Tariff Act. The issue is whether the processes of shearing and back-coating which do not figure in Chapter Note 4 to Chapter 60 of the Tariff Act, would fall within the ambit of "any other process" referred to in the said note. It is well settled that general terms following particular expressions take their colour and meaning as that of the preceding expressions, applying the principle of ejusdem generis rule, therefore, in construing the words "or any other process", the import of the specific expressions will have to be kept in mind. (See: Collector of Central Excise, Bombay vs. Maharashtra Fur Fabrics Ltd. (2002) 7 SCC 444 = 2002 (9) TMI 108 - SUPREME COURT OF INDIA). Therefore, the processes, with which we are concerned in the present appeals must take their colour from the process of bleaching, dyeing, printing, shrink- proofing, tentering, heat-setting, crease-resistant processing, specifically mentioned in the note. Grasim Industries Ltd. "10.In the background of what has been urged by the assessee it h....
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....r, and is not even remotely in the nature of the various hand tools listed in the entry 8201. 14.1. The appellants had laid much emphasis on the aspect that the Minilab was used exclusively for agricultural purpose and hence to be classified under Heading 8201 as 'tools of a kind used in agriculture'. This reason, can have no bearing nor relevance in the given context where the classification under Heading 8201 is to be governed only by the relevant Tariff-entries, Heading-description etc. Heading 8201 , as detailed above, does not provide any scope for nor in any manner envisages that all and every items used for agriculture would be covered therein. 14.2. Further, the Tariff specifically covers various items such as harvesting machinery, threshing machinery etc., which are also used exclusively in agriculture; under other headings; examples given below. 196. 8432 Agricultural, horticultural or forestry machinery for soil preparation or cultivation; lawn or sports-ground rollers 197. 8433 Harvesting or threshing machinery, including straw or fodder balers; grass or hay mowers; machines for cleaning, sorting or grading eggs, fruit or other agri....
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....ble Fe and Zn, and hot water soluble method for available B". (iv) The Manual further provides a detailed description as to the method and manner of usage of the instrument as also the various accessories, Reagents etc., for the purposes of testing the soil-samples; along with specific parameter-wise description of the procedures to be undertaken etc., which are all in the nature of chemical analysis of the samples to discern / determine the desired parameters. In fact, at various places, the Manual-description refers to and mentions the processes / procedures undertaken as "analysis"; some excerpts being as under: (i) "Most Important: It may be noted by the user that for the analysis of Organic C, Available P, K, S, Zn, Fe, Mn, Cu, and B, the instrument has to be set at zero level with distilled water... This has to be separately done before every analysts"^7 (ii) "1) Please note that entire analysis of micronutrients has to be done in double layer distilled water"^8, (iii) "These filtrates will be used for the analysis of Fe, Mn and Cu as explained below"^9, (emphasis added). (v) In fact, the meaning of the words "Reagents" as per standard dict....
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....planatory Notes, the instruments viz., "Wet chemical analysers" [for determining inorganic/organic components of liquids] and pH meters [used to measure the factor expressing the acidity or alkalinity of a solution] are specifically mentioned under Heading 9027. 18.2. As detailed above, by the nature, functions and usage etc., the Mridaparikshak instrument / Minilab falls within the specific phrase "instruments for physical or chemical analysis" used in Heading 9027. Hence, we find that this classification would be applicable under the primary criterion 'according to the terms of Headings' vide Rule I of the Interpretative Rules, mentioned earlier. 18.3. Notwithstanding the above, we find that Heading 9027 in the Tariff mentions the names of only some such instruments for physical / chemical analysis illustratively, as referred earlier. As such, the Adv. Ruling Authority was right in referring to the HSN Notes and in arriving at the conclusion basing on the specific mention therein of pH meter, Wet Chemical Analyser; which are used for the similar functions of measuring / determining the pH factor, inorganic / organic components etc., as done by the impugned Mridaparikshak / ....
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....been sought for in respect of Refill Reagents; which are subsequently supplied as per requirement as stated by the appellants; in the initial supply, they are supplied as part of the Minilab classification of which has been determined above. 22. For the reasons alike as detailed above, with regard to a classification under Heading 8201, we find that the Refill Reagents are not classifiable under the said Heading since these do not qualify to be considered as 'Hand tools' by any means. Appellants have also not put forth any separate grounds/contentions in support of their claim for classifying the Refill reagents under Heading 8201, other than those which we have already dealt earlier. 23.1. In so far as classification of Refill Reagents under Heading 9027 - as held by the lower Authority - is concerned, we find as follows. The lower Authority's reasoning and findings are that Refilling Reagents are part of Soil Testing Minilab; hence, parts and accessories identifiable as being solely or principally for use with instruments / apparatus of Heading 9027 are also to be classified under Heading 9027. This is apparently by applying Note 2 (b) to Chapter 90 supra, though not expres....
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.... (v) The question arises whether the Refill Reagents being chemicals used / consumed in the procedures / tests conducted for soil-testing / analysis can be considered as 'accessories' to the Minilab. In State of Uttar Pradesh vs M/s. Kores (India) Ltd. 1977 AIR 132, 1977 SCR (1) 837 = 1976 (10) TMI 131 - SUPREME COURT OF INDIA, Hon'ble Supreme Court dealing with the question of whether 'ribbon' is accessory or part of typewriter; held as under: "..Regarding ribbon also to which the abovementioned rule of construction equally applies, we have no manner of doubt that it is an accessory and not a part of the typewriter (unlike spool) though it may not be possible to use the latter without the former. Just as aviation petrol is not apart of the aero-plane nor diesel is a part of a bus in the same way, ribbon is not a part of the typewriter though it may not be possible to type out any matter without it." (vi) Similarly, in Annapurna Carbon Industries Co vs State of Andhra Pradesh 1976 AIR 1418 = 1976 (3) TMI 156 - SUPREME COURT OF INDIA, Hon'ble Supreme Court held that 'Cinema Arc Carbons' are accessories to Cinematographic equipment. (vii) Ratio of the above decision....
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....ever, in the given context of the Notification-entry mentioning a specific Tariff Heading against the description, the said phrase cannot have an extended / extrapolated meaning to cover any/all goods which do not fall under the said Heading itself, such as the impugned goods. 26. Accordingly, w.r.t. the third question for our determination we hold that the impugned goods are not covered by the entry SI.No. 137 in the exemption Notification as claimed by the appellant. 27.1. The appellant has cited various case laws in their grounds of appeal / further submissions; the broad details of which are as follows: Sl.No. Case law cited Forum Issue involved & Relevant Statute / Notification etc. 1. Sun Export Corporation vs. Collector of Customs, Bombay 1997(93) ELT.641 (S.C.) = 1997 (7) TMI 117 - SUPREME COURT OF INDIA Cited by appellant as STC 111 (page 69) Hon'ble SC Pre-mix of Vitamin AD-3 (feed) grade not for medicinal use, whether falls under "Animal feed supplement" and exempted under Notification 234/82-CE dated 01-11-1982 2. D.H. Brothers Pvt Ltd vs. Commissioner of Sales Tax, UP Lucknow = 1991 (8) TMI 288 - SUPREME COURT OF INDIA Hon'b....
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....hese decisions that 'in cases of two views or doubt /ambiguity, the view favourable to the assessee is to be preferred'; 'that among different applicable entries the lower rate of tax has to be applied'; 'that the end-user test has to be considered for classification'. However, we find that the above principles were applied in the situations involving an ambiguity / doubt as to the classification / eligibility for exemption vis-d-vis the statutory provisions / entries. In the instant case, as per our discussions and findings detailed above, the coverage of the impugned goods under Heading 9027 and the non-applicability of Heading 8201 as per the Tariff-entry as also the non-eligibility to the exemption-entry, are clear, unambiguous and without any scope for doubt. Hence, in our view, the aforesaid principles are not applicable to the present case. (iv) We may further mention that it is well-settled legal position that precedent decisions can have application / binding value only in respect of identical (and not merely similar) set of facts and circumstances. Hon'ble Supreme Court in Collector of C.Ex., Calcutta vs Alnoori Tobacco Products 2004 (170) ELT.135 (SC) = 2004 (7) TMI 9....
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.... enough because even a single significant detail may alter the entire aspect, in deciding such cases, one should avoid the temptation to decide cases (as said by Cordozo) by matching the colour of one case against the colour of another. To decide therefore, on which side of the line a case falls, the broad resemblance to another case is not at all decisive." "Precedent should be followed only so far as it marks the path of justice, but you must cut the dead wood and trim off the side branches else you will find yourself lost in thickets and branches. My plea is to keep the path to justice clear of obstructions which could impede it." 28. In view of the above, we find that none of the case laws cited by the appellant are applicable to the matter on hand. 29. In sum and having regard to the above discussions and findings, we hold that the impugned goods are correctly classifiable under Heading 9027 of the Tariff; they are not classifiable under Heading 8201 ibid. Further the impugned goods are not eligible for the exemption vide entry Sl.No. 137 of the Notification No. 2/2017- Central Tax (Rate) dated 28-6-201 7. The appellants have not made out any case for interferen....
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....pper". 9. Page 33 of the Manual under the heading "Procedure for iron, manganese and copper" after point (7). 10. www.dictionary.com 11. en.oxforddictionaries.com 12. Webster Comprehensive Dictionary, International Edition meaning as referred by Hon'ble Supreme Court in para 11 of 1997 (94) ELT.28 (SC) - United Copies India Pvt Ltd vs Commissioner of Sales Tax. = 1996 (3) TMI 142 - SUPREME COURT OF INDIA 13. Webster's Third New International Dictionary meaning referred by Hon'ble Supreme Court in Annapurna Carbon Industries Co vs State of Andhra Pradesh 1976 AIR 1418 = 1976 (3) TMI 156 - SUPREME COURT OF INDIA. ============= Document 1 ICAR Lab to Land Technology at Farmers' Doorstep..... हर कदम, हर डगर किसानों का हमसफर à¤à¤¾à¤°à¤¤à¥€à¤¯ कृषि अनà¥à¤¸à¤‚धान परि Agresearch with a human touch मृदापरीकà¥à¤·à¤• मृदा परीकà¥à¤·à¤....