TaxTMI 
TaxTMI 
2019 (3) TMI 1472
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....s specified otherwise, a reference to a Section or Provision of the CGST Act shall also mean a reference to the same Section or Provision under the MGST Act. Further, a reference to GST Act shall mean a reference to CGST Act and MGST Act. 02. FACTS AND CONTENTION - AS PER THE APPLICANT The submissions, as reproduced verbatim, could be seen thus- 1. "Shradha Polymats" is a Manufacturer of Floor Mats. The mats are made up by interweaving the straws manufactured from extrusion of PP Granules. These mats are popularly known as Polypropylene Mats (PP Mats) herein after referred to as 'the mats'. An alternate term used for the concerned product is 'Plastic Satranj'. 2. Manufacturing Process can be briefly explained as under: 1) Primary forms (PP Granules) is the basic raw Material used which may be either Virgin or made up from the Waste Plastic (Flakes). 2) These forms are put up in mixers for giving them desired Colour. 3) The Coloured Granules are then passed through extruders to take form of straws. 4) The straws are then interwoven using a thread to form Floor mats. 3. The Classification of above product Polypropylene Mats, is interpreted to be classified ....
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....laiting materials plaits and similar products of plaiting materials, placed side by side and bound together, in the forms of sheets, whether or not the binding materials are of spun textile materials" which perfectly creates the picture of Plaiting Material being straws made from the above mentioned process of extrusion and then bound together in parallel/ perpendicular strands to form the Mats. (2). It specifically excludes (a) wall coverings of heading 4814; (b) twine, cordage, ropes or cables, plaited or not (heading 5607); (C) footwear or headgear or parts thereof of Chapter 64 or 65; (d) vehicles or bodies for vehicles of basketware (Chapter 87); or (e) articles of Chapter 94 (for example, furniture, lamps and lighting fittings). 3. Thus the Mats appropriately complies with the Chapter Heading 4601 expression and the above five exclusions nowhere considers the Mats. The tariff Item 4601 99 00 'Other' excludes from itself the kinds of vegetable material as there are separate tariff Items 4601 29 00 'Other' and 4601 94 00 'Of Other vegetable material'. 10. From all the above it is being interpreted that the Polypropylene Mats falls under the HSN classific....
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....of tariff items, the first four-digits of which are 4601. For the Chapter 46 the expression "plaiting materials" means materials in a state or form suitable for plaiting, interlacing or similar processes; it includes straw, osier or willow, bamboos, rattan, rushes, reeds, strips of wood, strips of other vegetable material (for example, strips of bark, narrow leaves and raffia or other strips obtained from broad leaves), unspun natural textile fibres, monofilament and strip and the like of plastics and strips of paper. For the purpose of heading 4601 The expression "plaiting materials, plaits and similar products of plaiting materials, bound together in parallel strands" means plaiting materials, plaits and similar products of plaiting materials, placed side by side and bound together, in the form of sheets, whether or not the binding materials are of spun textile materials" which perfectly creates the picture of Plaiting Material being the hollow tubes and then bound together in parallel / perpendicular strands to form the Mats popularly called as PP Mats. The Sample of Plaiting material and Mat prepared there from is hereby made available for your honour's kind perusal. 2....
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....the HSN Notes below Heading No. 46.01, mats and matting (whether rectangular or in other shapes) made by weaving or binding parallel strands of plaiting material, twine, cord etc. are mentioned as goods falling within the scope of Heading No. 46.01 of the HSN. 4. In view of the above, it is clarified that plastic mat/matting (Satranji) would be appropriately classified under Heading No. 46.01 of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986). 3. It was also stated at the last of aforementioned circular that 'All the pending assessments may be finalized on the basis of above guidelines'. Thus Honourable CESTAT (Customs, Excise and Gold Tribunal - Delhi) in Supreme Industries Ltd. VS Commissioner of Central Excise-2004-(170) ELT 432 = 2004 (5) TMI 378 - CESTAT, NEW DELHI upheld the Classification of the Mats under the Chapter Heading 4601 not only from the date of aforementioned circular but also for the period before the date of the circular. (Copy of Judgment Enclosed) 4. We wouId again like to submit that, the Circular No. 4/2018 dated 24.01.2018, Amending All Industry Rates of Duty Drawback' effective from 25.01.2018 (Customs) Having File ....
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....ay be either virgin or made up from the waste plastic • Compounding - Polypropylene granules are mixed using a high speed mixer along with certain adhesives pigments and master batches are added to form the desired color shade. • Extrusion - The compound is added in extruders to form tubes of various length. • Knitting - The tubes are knitted or weaved with the help of P.P. thread to form mats of various length. The weaving Pattern can be a 2/2 will Structure or 3/1 Structure. • Finishing/ Testing - The Finishing and quality Control department ensures that edges of every mat are trimmed and every mat is Checked to see for any manufacturing defects. • Tailoring - The edges of the mat are double stitched with a polyester or non-woven Fabric tape to ensure its long usage. • The Classification of polypropylene mats - There is no Clear Provision for HSN Code of polypropylene mats. Hence it is always ambiguity for dealer that which HSN Code is used for P.P. Mats. The ambiguity is cleared by the custom department vide Circular no.4/2018 dated 24/01/2018 amending all industry Rates of Duty Drawback effective f....
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....ene is correct? Opinion - The HSN Classification Of polypropylene Mats is 4601. 2. If the answer to above question is affirmative, whether entry No. 198A (inserted vide Notification No 27/2017) is to be applied or Entry no 103 should be considered. In other words whether CGST /SGST Tax Rate us to be considered as 2.5% or 6% respectively? Opinion - Now as per central notification vide no-21/2018 of Central Tax (Rate) dated-26/07/2018, Rate for H.S.N code -4601 & 4602 is at the rate of 2.5% for CGST and MGST accordingly. 04. HEARING The Preliminary hearing in the matter was held on 28.11.2018, Sh. Saurabh Lodha C.A. Appeared and requested for admission of application as per contentions made in their application. Jurisdictional Officer was not present but forwarded the written submissions. The application was admitted and called for final hearing on 18.12.2018, Sh. Saurabh Lodha C.A. Appeared and made an oral and written submissions. The Jurisdictional Officer Sh. Sharad Patil, Asstt. Commr. of State Tax, Jalgaon appeared and made additional written submission. Both the parties were heard. 05. OBSERVATIONS We have gone through the facts of the case. The issue p....
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....of poly propylene mat, and applicability of the notification issued under the provisions of GST for which we have to first find the HSN Classification of PP Mat for which we may now refer to the terms of headings of 4601 and 4602, Chapter notes and the HS (Harmonized System) Explanatory Notes to chapter 46 which are reproduced below verbatim. Chapter No. 46 Manufactures of straw, of esparto or of other plaiting materials; basket ware and wickerwork NOTES : 1. In this Chapter, the expression "plaiting materials" means materials in a state or form suitable for plaiting, interlacing or similar processes; it includes straw, osier or willow, bamboos, rushes, reeds, strips of wood, strips of other vegetable material (for example, strips of bark, narrow leaves and raffia or other strips obtained from broad leaves), unspun natural textile fibres, monofilament and strip and the like of plastics and strips of paper, but not strips of leather or composition leather or of felt or non-wovens, human hair, horsehair, textile rovings or yarns, or monofilament and strip and the like of Chapter 54. 2. This Chapter does not cover: (a) wall coverings of heading 4814; (....
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....g 05.11 or Section XI). (ii) Monofilament of which no cross-sectional dimension exceeds 1 mm, or strip or flattened tubes (including strip and flattened rubes folded along the length). whether or not compressed or twisted (artificial straw and the like), of man-made textile materials, provided that the apparent width (i.e., in the folded, flattened, compressed or twisted state) does not exceed 5 mm (Section XI). (iii) Textile rovings (except when wholly covered with plastics as described in paragraph (5) above) (Section XI). (iv) Textile yarn impregnated, coated, covered or sheathed with plastics (Section XI). (v) Strips of leather or composition leather (generally Chapter 41 or 42) or of felt or nonwovens (Section XI) or human hair (Chapter 5, 59, 65 or 67). In addition the Chapter does not cover: (a) Saddlery and harness (heading 42.01). (b) Products or articles of bamboo, of Chapter 44. (c) Wall coverings of heading 48.14. (d) Twine, cordage, rope or cables, even if plaited or of unspun fibres (heading 56.07). (e) Narrow fabrics consisting of warp without weft assembled by means of an adhesive (bolducs) (heading 58.06).....
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....ushed vegetable materials assembled simply by twisting. The above goods are mainly used in millinery, but are also used for the manufacture of certain furniture, shoes, mats, baskets or other receptacles. The goods of this heading may contain spun textile yarn serving primarily for assembly or reinforcement purposes, whether or not having a supplementary decorative effect. 46.01 (B) Plaiting materials, plaits and similar products of plaiting materials, bound together in parallel strands or woven, in sheet form, whether or not being finished articles (for example, mats, matting, screens). The goods of this group are obtained either directly from plaiting materials as defined in the General Explanatory Note to the Chapter or from the plaits or similar products of plaiting materials described in Part (A) above. Those obtained directly from plaiting materials are either formed of strands woven together, generally in the manner of warp and weft fabrics, or made of parallel strands placed side by side and maintained in position in the form of sheets by transverse binding threads or strands holding the successive parallel strands. The woven goods may consist wholly of....
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....from the already assembled products of heading 46.01, i.e., from plaits or similar products, or from the products bound together in parallel strands or woven in sheet form. The heading does not. however. cover finished articles of heading 46.01, that is. plaiting materials, plaits and similar products of plaiting materials, which have acquired the character of finished articles by reason of being bound together in parallel strands or woven, in sheet form (for example. mats, matting or screens) : see the Explanatory Note to heading 46.01. paragraph (B) (2); and (iii) articles or loofah (gloves, pads, etc.) lined or not. Such articles include : (1) Baskets, panniers, hampers and basketware containers of all kinds, whether or not fitted with rollers or castors. including fish baskets, creels and fruit baskets. (2) Similar baskets or boxes of interlaced chipwood. But chipbaskets of non-interlaced chipwood are excluded (heading 44.15). (3) Travelling-bags and suitcases. (4) Handbags, shopping-bags and the like. (5) Lobster pots and similar articles; birdcages and beehives. (6) Thays, bottleholders, carpet-beaters, tableware, kitchenware and other household ....
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....led "Plastic Satranj " (i.e. Mats) under the Chapter Heading 4601. We also find that, Circular No. 4/2018 dated 24.01.2018, amending All Industry Rates of Duty Drawback effective from 25.01.2018 (Customs) issued from File No. 609/12/2018- DBK re-confirms the classification of Polypropylene Mats under tariff Item 460101 in Part 2 (c) of the same and deletes any other entry from the drawback schedule for Polypropylene Mats. The applicant submits that due to unknown reason, the First Schedule to the Customs Tariff Act, 1975 does not incorporate their products in heading 4601 and therefore are seeking a ruling on the classification of their product. The concerned officer also concurs that there is no clear HSN code of polypropylene mats. In order to understand the reason for this ambiguity we need to compare the entries at heading 4601 in the HSN (World Customs Organization's Harmonized System of Nomenclature) and in the First Schedule to the Indian Customs Tariff, 1975 because as India is a contracting party to WCO's HS Convention, the entries in the Customs Tariffs of the contracting parties are bound to be aligned with the HSN up to six digit (Sub-Heading) level. And the....