TaxTMI 
TaxTMI 
2020 (12) TMI 1335
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....ty, Distt, Pali-306104 (hereinafter also referred to as 'the Appellant') against the Advance Ruling No. RAVAAR/2020-21/01 dated 06.05.2020. BRIEF FACTS OF THE CASE 3. M/s. Sh. Sunil Kumar Gehlot (Trade name Sunil Kumar & Co.) (hereinafter refer to as Appellant) is registered with the GST department for manufacture of hair dye powder and is having GST Registration Number 08AAUHS7425MIZ6 and intends to manufacture Mehandi/Henna powder in future, therefore, Appellant filed an application for Advance Ruling before the Rajasthan Authority for Advance Ruling (hereinafter referred to as AAR) seeking clarification whether henna is classifiable under chapter 14 or 33 of GST Tariff? 3.1 MR has observed that Henna/Mehendi powder has a natural property of dye/tanning and is generally used as hair dye and issued ruling vide their order dated 06.05.2020 that Mehendi /Henna powder is covered under Chapter 33 and will attract GST @18% (CGST 9% + SGST 9%). 4. Aggrieved by the Ruling above, the Appellant has preferred the present appeal before this forum. The Appellant has filed appeal on line on 17.06.2020. The Appellant has deposited SGST fee of Rs. 10000/- on 15.06.2020 and CGST fee o....
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....al use of application on hands and feet by women on festive and auspicious occasions. Henna powder which is sold with absolutely no indication of its use as hair dye or an application for use on hair. It is to be noted that conversion of henna natural leaves (agricultural produce) into powder form is a simple process of grinding. The natural leaves which are powdered with the grinder without involving any other process do not change the characteristics and nature of henna leaf. The process of grinding does not involve any preparation. The appellant's submission was that the entry "Henna" rightly continues in the Departmental Publication. The learned MR has totally misinterpreted the amendment made vide Finance Act, 2006. In the amendments carried out in the Customs Tariff Act and Central Excise Act, it has been clearly stated that in the heading 1404, sub-headings and the entries relating thereto have been omitted. The whole heading has not been deleted. It is for this reason "Henna" continued to remain in the main heading of the Tariff. A bare reading of the Heading of Chapter 14 of the Tariff indicates that, both prior to as well as after 2006, it covered products "not elsewhere ....
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....r to the Customs Tariff. Customs Tariff is based on Harmonised System of Nomenclature (HSN). In the HSN, Henna Powder is included under Chapter 14, signifying that henna powder as vegetable product is included in Chapter 14 (HSN) and it is a settled law that while deciding the dispute of classification of a product, HSN and its explanatory notes should be referred to since the scheme of Customs Tariff is based by (HSN) and explanatory notes to HSN. Explanatory notes provide a safeguard for interpretation with regard to classification of an entry in the Customs Tariff. In view of the fact that 'Henna powder' is classified under Chapter 14 of (HSN) and explanatory notes thereto, it would merit classification only under Chapter 14 of Central Excise tariff. By placing reliance upon the HSN and its explanatory notes, the classification of henna powder can fall only under Chapter 14 and nowhere else. (iii) THAT after. introduction of the GST, manufacturers of Henna Powder and paste got themselves registered under GST. The registration was done on-line in the GST website - gst.gov.in. In the process of registration in the website, an option was asked from the assessee to provide ....
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....x payable (c) 5%. (vii) THAT if any manufacturer of pure henna powder (not mixed with any other ingredient) is selling henna powder with an indication or intention to be used as a preparation for hair dye, then the said powder would merit classification under Chapter 3305 and tax at the rate of 18%. The law is very clear on this point and the department while deciding classification of henna powder should note this very necessary and legal distinction. This will separate the wheat from the chaff i.e differentiate between henna powder sold for its predominant use i.e. for application on hand and feet by women and henna powder sold as preparation for use on hair. This strict test should be applied while deciding the classification of henna powder instead of treating every henna powder as a preparation for use on hair and classifying it compulsorily and wrongly under chapter 3305 and asking for duty @ 18%. While perusing the sub-heading of chapter 3305, one will find that this chapter deals with preparation which are exclusively used on hair and under this heading no specific sub-heading provides the entry as henna/mehandi powder under GST laws. On the other hand henna powder....
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....n for use on hair would merit classification under chapter 1404 1019 and if it is sold with the intention or is intended to be a preparation for use on hair then it would merit classification under chapter 3305 and as per the impugned notification duty g 8% ad valorem would be levied on this henna powder. Chapter heading 3305 inter alia covers to include preparation for use on hair. It was further opinioned in the short reply of the department since henna powder is usable as a preparation for use on the hair and it is so indicated in the literature or documents and there is no doubt about the intention as such, such henna powder would be classified under chapter 3305. The classification of a product is dependent on its use. Under the law it is the duty of the manufacturer to indicate the uses of the product. It was clearly stated in the short reply by the department that "there has been no mistake in notification No 4/2006-CE issued by the Govt. classifying henna powder not mixed with any other ingredient under heading 3305, as the same was intended to cover henna which was intended to be a preparation for use on the hair and Central Excise duty at the rate of 8% is chargeable. 'Th....
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.... Authority has not even discussed the manner in which the amendments have been carried out from time to time. The appellant in the submissions made herein above, has clearly referred to all the Notifications introduced from time to time dealing with the product Henna Leaves, Henna Powder and Paste. Therefore, without appreciating any of the above facts, the Advance Ruling Authority has abruptly jumped to the conclusion that Mehandi/Henna Powder is covered under Chapter 33 and would attract GST @ 18%. The learned Advance Ruling Authority ought to have considered each and every aspect of the case while giving the ruling on the classification of the product. Since the Advance Ruling Authority In the present case has totally failed to address any of the Issues mentioned hereinabove, the Impugned decision, is liable to be set aside. (xiii) THAT for the aforesaid reasons the appellant products Henna Powder has to be classified under Tariff Heading 1404 and not under 3304 or 3305, and the Impugned order deserves to be set aside in toto. (xiv) The appellant has also filed application for condonation of delay and submitted that the hard copy of the Advance ruling Order No.....
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....he limitation is prescribed under sub-section (2) of Section 100 of the CGST Act as 30 days. Admittedly, in the present case, if the date of receipt of the hard copy of the order is taken into consideration i.e. 18.05.2020, the period of limitation would expire on 17.06.2020 (excluding the date on which the order was received). The appeal in the present case has been filed online on 17.06.2020. In such a case, there is no delay in filing of the appeal. If the date of receipt of the order is taken as the date on which the impugned order has been uploaded in the website, there is delay of 10 days which, is, within the power of the Appellate Authority to condone it. 5.2 It was pointed out during the course of personal hearing that as to why the date of filing of the appeal should not be treated as the date on which the fee of Rs 10,000/- payable towards CGST has been paid. In this regard, it is submitted that the prescribed method of filing the appeal was E-Filing. The requisite fee for filing of the appeal is Rs 10.000/- towards CGST and Rs 10.000/- towards SGST. Unfortunately, the website while processing the filing and payment, the applicant was able to generate the challan and ....
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....eal was presented before the Tribunal and due acknowledgement is also given for the said date. Such a practice continues to be in force even today. 5.5 That the Hon'ble Tribunal in the case of Central India Tobacco Products Pvt Ltd v Collector of Central Excise, 1987 (29) ELT 472 while dealing with a case where there was deficiency in the court fee has held that in case the appeal is not properly stamped it ought to have been returned to the appellants for presentation after supplying (affixing) the requisite court fees stamp. There is no such express provision in the Central Excises and Salt Act, 1944 and yet there is no prohibition in the Act in resorting to the principles contained in Civil Procedure Code. 5.6 That the Hon'ble High Court of Delhi in the case of Union of India v Roshal Lal & another AIR 1968 DELHI - 165, at page 166 has in the context of paying deficient court fee held that a document not bearing proper Court-fee cannot be considered to be validly presented to the Court, but the principle underlying Section 149 suggests that the question of Court-fee is a question between the Revenue and the litigant and, therefore, the Court has a discretion albeit judicia....
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.... (1) An appeal against the advance ruling issued under sub-section (6) of section 98 shall be made by an applicant on the common portal in FORM GST ARA-02 and shall be accompanied by a fee of ten thousand rupees to be deposited in the manner specified in section 49. (2)-------- (3) The appeal referred to In sub-rule (1) or sub-rule (2), the verification contained therein and all the relevant documents accompanying such appeal shall be signed, - (a) in the case of the concerned officer or jurisdictional officer, by an officer authorised in writing by such officer; and (b) in the case of an applicant, In the manner specified in rule 26. 6.3 The Appellant has filed appeal on line on 17.06.2020. The Appellant has deposited SGST fee of Rs. 10000/- on 15.06.2020 and CGST fee of Rs. 10000/- on 22.10.2020. On perusal of appeal filed on 17.06.2020, it was found that the appellant has not filed the appeal in prescribed format. The appellant further filed the appeal in prescribed format on 02.11.2020. The appellant has submitted that the Advance Ruling dated 06.05.2020 was received by him on 18.05.2020. Hence, in terms of the provisions of Section 10....