TaxTMI 
TaxTMI 
2019 (2) TMI 188
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....r 1st Street, Bhavani - 638 301. (hereinafter referred to as Applicant) are the manufacturers of Stick-Bags / Wedding Gift Bags / Packing Bags made of Non-woven Fabrics of Polypropylene / 100% Cotton (Grey Fabrics). They are registered vide GSTIN: 33AEVPT0022L1Z9. They have sought Advance Ruling on "Classification of Bags made of Non-Woven Fabrics of Polypropylene / 100% Cotton (Grey Fabrics) used the Packing of goods, commonly called as Stick Bags, Wedding Gift Bags, Re-useable Shopping Bags, Draw-String, Gift Bags, Garment Bags, etc., and the rate of tax payable under the GST Act 2017." The Applicant has submitted the Advance Ruling in Form GST ARA - 01 and had enclosed challan for payment of fees of Rs. 5,000/- each under sub-rule (1) of Rule 104 of CGST Rules 2017 and SGST Rules 2017. 2.1 The Applicant has stated that they manufacture Stick-Bags / Wedding Gift Bags / Packing Bags made of Non-woven Fabrics of Polypropylene / 100% Cotton (Grey Fabrics); Their bags are mainly purchased by the Show Rooms (Cars, Bikes, Vehicle Parts and Spectacles), Textile Shops, Silk Emporiums, Jewellery Shops, Retail Outlets of Commercial products etc. for the purpose of packing of their....
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....is levied based on the value of the product, i.e., @ 2.5% - for value not exceeding Rs. 1000 per piece and @ 6%- for sale value exceeding Rs. 1000 per piece. In the present case, the sale value of 'Bags made of Non-woven Fabrics of Polypropylene/woven fabrics of cotton" is less than Rs. 1,000/- per piece and therefore, it appeared that the impugned/disputed goods attract GST at the rate of @ 5% ad vide entry No.224 of Schedule I of both CGST and SGST notifications. The Applicant has also stated that the bags manufactured by them are rightly classifiable under Chapter Heading 6305 and relied on the decision of Advance ruling Authority, State of Kerala in the case of M/s. JJ Fabrics, Ernakulam. 3. The Applicant was personally heard. During the hearing, they have stated that they purchase raw material namely Polypropylene/Non-Woven Fabrics and Cotton in rolls. They die certain fabrics. They cut both to requirement and print using offset printing and screen printing on jobwork basis 85 stitch into carry bags. The design is given by their buyers. They produced copies of Invoices of Inward and Outward supplies. They also produced samples of Non-woven Bag/ Cotton Bags. 4. Conten....
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.... --- Plastic coated or paper cum polythene lined jute bags and sacks kg. 25% - 6305 10 70 --- Paper laminated hessian jute kg. 25% - 6305 10 8O --- Jute soil savers kg. 25% - 6305 10 90 --- Other kg. 25% - 6305 20 00 - Of cotton kg. 25% - - Of man-made textile materials : 6305 32 00 --- Flexible intermediate bulk containers kg. 25% - 6305 33 00 -- Other, of polyethylene or polypropylene strip or the like kg- 25% - 6305 39 00 -- Other kg. 25% - 6305 90 00 - Of other textile materials kg. 25% - 6306 TARPAULINE AWNINGS AND SUNBLINDS: TENTS HSN explanatory Notes to chapter 6305 states: This heading covers textile sacks and bags of a kind normally used for the packing of goods tor transport, storage or sale. These articles, which vary in size and shape, include in particular flexible intermediate bulk containers, coal, grain, flour, potato, coffee or similar sacks, mail bags, and small bags of the kind used for sending samples of merchandise by post. The heading also inc....
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....bags and shopping bags, of cotton u 10% 4202 22 30 --- Hand-bags and shopping bags, of Jute u 10% 4202 22 40 --- Vanity-bags u 10% 4202 22 90 --- Other u 10% 4202 29 -- Other : 4202 29 10 --- Hand bags of other materials excluding wicker-work or basket work u 10% 4202 29 90 --- Other u 10% From the above, it is seen carry bags or shopping bags are covered in the Customs Tariff under CCTH 420222 depending on the material they are made up of. Shopping bags made of cotton are classified under CTH 42022220 and those made of non-woven fabrics are classifiable under CTH 42022210. 5.3 Having decided the classification, the next to be answered is the applicable rate of tax. Non-woven and cotton carry bags supplied by the Applicant were taxable to 9% CGST and 9% SGST as per SI no 126 and 127 of Schedule III of Notification No. 01/2017-CT (Rate) dated 28.06.2017 and G.O. (Ms) No. 62 dated 29.06.2017 No. II (2)/CTR/532(d-4)/2017 as amended respectively. The relevant entries are found in Schedule III attracting 9% tax as give....