TaxTMI 
TaxTMI 
2021 (4) TMI 558
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....cant has stated that the relevant entries in the respective Schedules of Notification No.01/2017-Central Tax (Rate) dated 28.06.2017 as amended till date, for the purpose of the applicant's product in question reads as under: Sch. Sl.No. Chapter/Heading/Sub-Heading Description of Goods Rate of Tax (GST) II 228 9503 Toys like tricycles, scooters, pedal cars etc. (including parts and accessories thereof) [other than electronic toys] 6% The applicant has stated that the aforesaid Notification contains the following explanation: (iii) "Tariff item", "sub-heading" "heading" and "Chapter" shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of this notification. 3. The applicant has submitted that a perusal of the aforesaid provisions read with explanation to the Notification No.01/2017....
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....s' carriages; dolls; other toys; reduced-size ("scale") models and similar recreational models, working or not; puzzles of all kinds: 9503 00 10 --- Of wood 9503 00 20 --- Of metal 9503 00 30 --- Of plastics 9503 00 90 --- Other 5. The applicant has submitted that as can be noticed from above that Customs Tariff Act, 1975 Chapter Heading No.9503 covers toys of various kinds for children. Tariff Item Nos.9503 00 10, 9503 00 20 and 9503 00 90 cover toys made of wood, plastics and metals. Tariff Item No.9503 00 90 is the residual entry under which other toys for children of similar nature (but not made of metal, wood or plastics) can be classified; that therefore, it is submitted, that the applicant's product i.e. Plastic toys, which are essentially made of PLASTIC, should be classified under Tariff Item No.9503 00 30 itself; that it can be said that as far as Notification No.01/2017-Central Tax(Rate) dated 28.06.2017 as amended till date broadly classifies toys into two categories i.e. (1) Other than Electronic Toys and (2) Electronic Toys; that toys which are other than Electronic Toys attract CGST 6% and SGST 6% falling under Tariff headin....
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....e has been corrected and in view of the same, assessee like the applicant can now claim Input Tax Credit in such circumstances. The applicant has stated that in the circumstances and in view of the above position of law, they request the Advance Ruling Authority to hold that the applicant shall be entitled to claim Input Tax Credit in relation to CGST-SGST charged separately in debit notes issued by the supplier in current financial year i.e. 2020-21, towards the transactions for the period 2018-19. 7. The applicant has asked the following questions seeking Advance Ruling on the same: "(1) What is the appropriate classification and rate of GST applicable on supply of the PLASTIC TOYS under CGST and SGST? (2) Can the applicant claim Input Tax Credit in relation to CGST-SGST separately in debit notes issued by the supplier in current financial year i.e. 2020-21, towards the transactions for the period 2018-19?" DISCUSSION & FINDINGS: 8. We have considered the submissions made by the applicant in their application for advance ruling as well as the arguments/discussions made by their representative Shri Nishant Shukla at the time of personal hearing. We have ....
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....to the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) in order to find out the correct classification of the said products. Also, since the applicant in his question seeking Advance Ruling has stated that the toys of plastic manufactured by them would fall under 9503 00 30, we find it imperative to refer to Heading 9503 under Chapter 95 (Toys, games and sports requisites; parts and accessories thereof). Headings 9503 reads as under: 9503 TRICYCLES, SCOOTERS, PEDAL CARS AND SIMILAR WHEELED TOYS; DOLLS' CARRIAGES; DOLLS; OTHER TOYS; REDUCED-SIZE ("SCALE") MODELS AND SIMILAR RECREATIONAL MODELS, WORKING OR NOT; PUZZLES OF ALL KINDS 9503 00 - Tricycles, scooters, pedal cars and similar wheeled toys; dolls' carriages; dolls; other toys; reduced-size ("scale") models and similar recreational models, working or not; puzzles of all kinds: 9503 00 10 --- Of wood 9503 00 20 --- Of metal 9503 00 30 --- Of plastics 9503 00 90 --- Other 12. Chapter notes of Chapter 95 read as under: NOTES : 1. This Chapter does not cover : (a) Candles (heading 3406); (b) fireworks or other pyrotechn....
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....is Chapter includes articles in which natural or cultured pearls, precious or semi-precious stones (natural, synthetic or reconstructed), precious metal or metal clad with precious metal constitute only minor constituents. 3. Subject to Note 1 above, parts and accessories which are suitable for use solely or principally with articles of this Chapter are to be classified with those articles. 4. Subject to the provisions of Note 1, heading 9503 applies, inter alia, to articles of this heading combined with one or more items, which cannot be considered as sets under the terms of rule 3 (b) of the General rules for Interpretation of this schedule, and which, if presented separately, would be classified in other headings, provided the articles are put up together for retail sale and the combinations have the essential character of toys. 5. Heading 9503 does not cover articles which, on account of their design, shape or constituent material, are identifiable as intended exclusively for animals, for example, "pet toys" (classification in their own appropriate heading). SUB-HEADING NOTE Sub-heading 9504 50 covers : (a) Video game consol....
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....dings as well as the rates of Central Tax GST applicable to various goods which are covered under 6 schedules as under: (i) 2.5 per cent. in respect of goods specified in Schedule I, (ii) 6 per cent. in respect of goods specified in Schedule II, (iii) 9 per cent. in respect of goods specified in Schedule III, (iv) 14 per cent. in respect of goods specified in Schedule IV, (v) 1.5 per cent. in respect of goods specified in Schedule V, and (vi) 0.125 per cent. in respect of goods specified in Schedule VI On going through the aforementioned notification, we find that Sub-heading 9503 appears at Entry No.228 in Schedule-II of the said notification (wherein GST rate is 12% (6% SGST + 6% CGST). The same reads as under: Sr.No. Chapter/Heading/ Sub-heading/ Tariff item Description of goods 228. 9503 Toys like tricycles, scooters, pedal cars etc. (including parts and accessories thereof) [other than electronic toys] We therefore conclude that the Toys of plastic manufactured and supplied by the applicant fall under Sr.No.228 of Schedule-II of Notification No.01/2017-Central Tax(Rate) dated 28.06.2017 and the GST a....
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....tions for the period 2018-19. 17. In view of the above submission, we find it necessary to compare the relevant portion of sub-section (4) of Section 16 of the CGST Act, 2017 as it existed prior to assent of the Finance Bill, 2020 by the President of India to that of the relevant portion of the said sub-section after the assent of the Finance Bill, 2020. But, before that, we find it imperative to refer to sub-section(4) of Section-16 of the CGST Act, 2017 as it appeared prior to the enactment of the Finance Bill, 2020 which reads as under: (4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier. We have also gone through the Finance Bill No.12 of 2020 which was introduced in Parliament in 2020. On going through the same, we find that there is a proposal in Section-120 in the said Bill which proposes to omit the word....
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....e or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or debit note pertains or furnishing of the relevant annual return, whichever is earlier." 20. On comparing the two above, we find that in the fourth line, the words "invoice relating to such" before the words "debit note pertains" have been omitted vide the Finance Act, 2020. In other words, that portion of the sentence which read as "such invoice or invoice relating to such debit note pertains" will now read as "such invoice or debit note pertains". However, on going through the above as well as the submission of the applicant, we do not find it to be such a drastic or far reaching change affected by the Finance Bill, 2020 as interpreted by the applicant, as, irrespective of the fact as to whether the words "invoice relating to such" is connected to "debit note" or omitted, the fact remains that a debit note is always connected to the invoice and issued in relation to change in value of an invoice. Just because the words "invoice relating to such" connected to "debit note per....
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....been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient a debit note containing such particulars as may be prescribed." Further, as per the e-flyer issued by the Central Board of Excise and Customs, there is no prescribed format for debit note, but the debit note issued by a supplier to the recipient must contain the following particulars, namely: (a) name, address and Goods and Services Tax Identification Number (GSTIN) of the supplier (b) nature of the document (credit note or debit note) (c) a consecutive serial number that is unique and should not exceed 16 characters, be in one or multiple series, contain alphabets, numerals or special characters such as hyphen, dash, symbolised as "-"respectively, and any combination thereof, unique for a financial year. (d) date of issue. (e) name, address and Goods and Services Tax Identification Number or Unique Identity Number, if registered, of the rec....