TaxTMI 
TaxTMI 
2020 (8) TMI 246
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....h as Couplers, Knuckle, Locks, Toggle, Yoke etc., & the applicable GST rate thereon. The applicant, at present, is supplying the aforesaid parts to M/s. Sanrok Enterprises, Faridabad, as per the specifications & drawings, who in turn supply the same to the Indian Railways, on classifying the said goods under HSN 8607 & on discharging the GST @5%. 3. The applicant stated that a consultant opined that the impugned goods are liable to be classified under HSN 7325 and the applicable rate of GST is 18%. Hence the applicant filed the instant application, seeking advance ruling on the following question: Railway parts such as Couplers, Knuckle, Locks, Toggle, Yoke etc., manufactured and supplied by us to our buyer Sanrok Enterprises (who in tum supply to Indian Railways after assembly) be classified under HSN 8607 or to be classified under HSN 7325 as other cast articles of Iron or Steel? 4. Admissibility of the application: The question is about classification of the goods and hence is admissible under Section 97(2)(a) of the CGST Act 2017. 5. Applicant's interpretation of Law: 5.1 The applicant stated that the buyer M/s. Sanrok Enterprises, Faridabad, placed the ord....
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....he following grounds. a) The ultimate consumer of the impugned castings is Indian Railways, though the buyer is M/s. Sanrok Enterprises, Faridabad & also the said castings can't be used by anyone other than Indian Railways. b) The classification of any goods can't be changed during the different stages of supply chain & hence the impugned castings can't be classified under chapter heading 7325 for the transaction between Applicant & Buyer and be classified under chapter heading 8607 for the transaction between M/s. Sanrok Enterprises (Buyer) and the Indian Railways. c) Classification of Iron castings under chapter heading 7325 is a general entry. However when specific entry is provided on the basis of usage, specific entry overrides the general entry. In this regard the applicant quoted Rule 3(a) & 2(a) of General Rules of Interpretation of Import Tariff under Customs Tariff Act 1975. d) The buyer has given affidavit to the effect that the impugned castings are meant for supply to only Indian Railways. e) The applicant, with regard to the issue that the castings are further processed by the buyer (M/s. Sanrok Enterprises), contends as under: "Some small cast....
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....pecial grade of material called M-201, as specified by Indian Railways. Also the said coupler parts are mandatorily need to be procured only from 'class A foundry' & the applicant is one such approved class A Foundry, approved by RDSO, Lucknow. All these facts prove that the coupler parts being manufactured and supplied by us are Railway Parts classified under chapter heading 8607. j) The applicant also intend to rely on the Tribunal Judgment in the case of Poona Radiators Vs Collector of Central Excise (15.02.1990) = 1990 (2) TMI 182 - CEGAT, NEW DELHI wherein it is held that Radiators supplied to Railways are classifiable under chapter heading 8607. They also quoted ruling of this authority in the case of VST Tillers Tractors Ltd., Bangalore and also the decision of GST council's 37th meeting to stress upon the usage of the manufactured product & contends that the rat of GST is purely depends on the usage. They conclude that the impugned castings are rightly classifiable under chapter heading 8607 & attract 5% GST. 8. DISCUSSION & FINDINGS: We have considered the submissions made by the Applicant in their application for advance ruling as well as the submissions ma....
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....e impugned goods have given an affidavit that the said goods supplied by the applicant are in turn supplied only to Indian Railways & the said goods are not useful for anyone other than the Indian Railways and thus the impugned goods are suitable for use solely with the Railway Locomotives. It is observed from the photographs submitted by the applicant that the goods are suitable only for coupling the railway bogies/wagons and hence the first conditions is fulfilled. 8.8 Now we proceed to examine the fulfillment of the second condition as to whether the impugned goods have been excluded by the provisions of the Notes to Section XVII or not. Section Notes 2 & 3 of Section XVII are relevant, among the five Notes, to the issue of parts or parts & accessories. Note 2 specifies that the expressions 'parts' and 'parts & accessories' do not apply to certain listed articles, whether or not they are identifiable as for the goods of Section XVII and the impugned goods are not covered under the list of articles specified in Note 2. Thus the impugned goods have not been excluded by the provisions of the Note 2 to Section XVII. Further Note 3 of the said section specifies as under: ....