TaxTMI 
TaxTMI 
2021 (9) TMI 319
X X X X Extracts X X X X
X X X X Extracts X X X X
....alled the Applicant) are registered under GST with GSTIN 33AAECE2203J1Z5. The applicant has sought Advance Ruling on: 1. Whether the supply of goods under HSN Code 8407 while principal supply is for fishing boats and vessels applying 5% GST rate is correct or not. 2. As per the earlier Advance Rulings issued in various states and circular issued from Ministry of Finance (Revenue Department) it clearly states that the GST liability for HSN 8408 is only 5% when it is supplied to fishing boats and vessels even though it is in higher taxable rate of 28% GST under the GST Schedule. Why it cannot adopt the same for HSN 8407 marine engines. 3. Goods of supply under HSN code 8409, 8483, 8902, 8487, 8501, 8502, 8415, 8418, 8413 which is also supplied to fishing boats and vessels mainly. Whether it can be adopted as per the circular. The Applicant has submitted the copy of application in Form GST ARA - 01 and also submitted a copy of Challan evidencing payment of application 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 are a private limited company incorporated in the ye....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d thereby would be taxable @ 5% GST as per SI No.252 of Schedule I of the Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. If it is used for some other purpose, the applicable tax rate would be 28% GST as per SI No, 135 of the said notification. iii.. The marine diesel engine and gear boxes supplied for use in vessels/ goods fading under heading 8901, 8902, 8904, 8905, 8906, 8907 will be deemed to be parts of such goods and thereby taxable (c)6% GST per Serial No.252 of Schedule-I of the Notification No, 1/2017 Central Tax (Rate) dated 28.06,2017. If it is used for some other purpose, the applicable" tax rate would be as per their respective TSH 8408 and 8433 at the rate of 28% GST as per SI Nos 115 and 135 of the said notification. They have also furnished copy of ruling issued by Maharashtra AAR in the case of CS Diesel Engineering Private Limited. 3.1 Due to the prevailing PANDEMIC situation and in order not to delay the proceedings, the applicant was addressed through the Email Address mentioned in the application to seek their willingness to participate in a virtual Personal Hearing in Digital media on 26.03.2021. The applicant vide return mail dated....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rs making the following products and hence are seeking ruling:: • Marine Engines & Marine Outboard Motors (OBMs) and spark-ignition type, falling under HSN 8407 & 8407 2100 (from Honda Marine, Japan) - primarily used for fishing boats & vessels under 8902, other than 8901, 8904, 8906 & 8907. • Marine Diesel Engines (for propulsion application) falling under HSN 8408 1093 (Hyundai Seasall, Korea) - primarily used for fishing boats & vessels under HSN 8902, work boats including passenger boats & barges under HSN 8901, other than 8904, 8906 & 8907. • Marine Outboard Engines and compression-ignition type and falling under HSN 8408 0101 (from Hyundai Seasall, Korea) - primarily used for fishing boats & vessels and alike with HSN: 8901, 8902, 8904, 8906 and 8907. • Marine Gensets falling under HSN 8501 & 8502 (from Hyundai Seasall, Korea) - primarily used for fishing vessels and alike with HSN: 8902, 8901,8904, 8906 & 8907. • Marine Gearboxes falling under HSN 8483 (from D-I, Korea) - primarily used for fishing boats & vessels and alike with HSN: 8901, 8902, 8904, 8906 and 8907. • Marine Generating Sets falling....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ferred to Notification No. 02/2021 Integrated Tax (rate) dated 02.06.2021 clarifying that maintenance, repair or overhaul services in respect of ships and other vessels, their engines and other components or parts will fall under 5% GST w.e.f. 2nd June 2021. They have submitted the Balance sheets for 2018, 2019 & 2020 of the entity without any notes to the Balance sheet. 3.3 On perusal of the above submissions, it was seen that the applicant has stated that they are providing complete sales & Service Support to all their customers and have multiple Service Centers/trained manpower across the Coastline for the same, whereas during hearing it was informed that they have not carried on this activity Pre-GST regime and also they don't have any purchase orders at present. The applicant was called upon to substantiate this contradiction with evidences like copy of invoice for sale/support extended, picture and technical write-up of the items dealt with presently & details of Service Support Centers; Pictures of the items for which the classification is sought along with the item-wise technical write-up. 3.4 The applicant vide their letter dated 29.07.2021 submitted the followin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....with pictures and item-wise technical write-up verbatim below: Outboard Motor (OBM}: from Honda Marine, Japan: Marine Diesel Engines & Marine Outboard Engines: Hyundai Marine Gensets: Hyundai Seasall Korea Marine Gearboxes: D-I. Korea Fuel water Separators - Griffin Filters, Singapore: Marine Air-Conditioning Systems: Technic old. USA Marine Refrigeration Systems - Sunwell, Canada: Marine sea water pumps: JMP Corporation, Korea Propellers for Marine Outboard Motors (OBM) and Marine Control & Steering Systems; Ultraflex, Italy Marine Spares & Accessories (HS 8409, 7507, 7616, 8543) 4. The Centre Jurisdictional authority who has administrative control over the applicant has furnished the following remarks: Q.No:1 As per Notification No.01/2017 dated 28.06.2017 Central Tax the HSN Code 8407 - it attracts rate of duty 28% (CGST 14% and SGST 14%) Question No.2 According to Notification No.01/2017 Central Tax - HSN Code 8408- there is a condition that if the Engine having capacity 15 HP it attracts 12% (CGST 6% and SGST 6%) otherwise it attracts rate of duty 28% (CGST 14% and SGST 14%) Question No.3 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....utboard Engines from Hyundai Seasall, Korea(HSN:8408 1093) • Marine Gensets from Hyundai Seasall, Korea (HSN 8502); • Marine Gear boxed from D-I, Korea (HSN:8483); • Fuel water Separators from Griffin Filters, Singapore (HSN 8421); • Marine Air-Conditioning System from Technicold, USA (HSN 8415); • Marine Refrigeration Systems from Sunwell, Cananda (HSN 8418); • Marine Sea Water Pumps from JMP Corporation, Korea(HSN:8413 and 8421); • Propellers for Marine Outboard Motors (OBM) and Marine Sterndrives from Solas, Taiwan (HSN:...) • Control & Steering Systems from Ultraflex, Italy(HSN 8483) • Marine Spares & Accessories(HSN: 8408, 8407, 8483, 8415, 8418, 8502, 8487 and 8421) Apart from the pictures and write-up, the applicant has not furnished any documents such as Bill of Entry, Tax Invoice, Purchase Order, address of sale & Service centers, letter/correspondences to support their argument that they are in discussion with the mentioned Principals, the class of buyers of such intended goods, agreement/letter entered into with such class of recipients, etc which are e....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tion; Floating Docks; Floating Or Submersible Drilling Or Production Platforms; • 8906- Other Vessels, Including Warships And Lifeboats Other Than Rowing Boats; • 8907- Other Floating Structures (For Example, Rafts, Tanks, Coffer-Dams, Landing-Stages, Buoys and Beacons). 7.4 In the case at hand, the applicant has stated that they have been established in March 2020 for the proposed supplies but had not furnished any documentary evidence to substantiate their proposed supply in the form of any Purchase Order from any class of recipient, List of goods to be supplied or any documentary evidence to prove the proposed business of the applicant, i.e., any correspondences with the proposed principal suppliers with whom they intend to enter into transactions or agreements/Purchase orders for further supply. In this situation, without the specifics of the proposed supply, substantiated with the material facts, this authority is constrained to rule on the applicability of the said entry to the proposed transactions, based on the clarification in the Circulars and the rulings extended by the Advance Ruling authorities of Kerala, Maharashtra, etc. It is pertinent t....