TaxTMI 
TaxTMI 
2022 (9) TMI 727
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....cant submitted that they had already submitted all their submissions on the issue and has nothing more to add. 3. Question on which Advance Ruling is sought: The applicant has sought advance ruling on the classification of roof mounted Air-conditioning unit especially for use in railway coaches (manufactured as per railway design) i.e. whether they are classifiable under HSN- 8415 1090- IGST @ 28% or under HSN 8607 99 - IGST @ 18% as parts of Railway Coaches; Locomotives? 4. Eligibility of The Application For Advance Ruling: The Section 97(2) of the Central Goods and Services Tax Act, 2017, read with Section 97(2) of the Punjab Goods and Services Tax Act, 201 7, provides for the issues on which advance ruling can be sought. 97 (2) The question on which the advance ruling is sought under this Act, shall be in respect of, (a) classification of any goods or services or both; (b) applicability of a notification issued under the provisions of this Act (c) determination of time and value of supply of goods or services or both; (d) admissibility of input tax credit of tax paid or deemed to have been paid; (e) determination ....
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.... The effect of Note 3 is therefore that when a part or accessory can fall in One or more other Sections as well as in Section XVII, its final classification is determined by its principal use. Thus. the steering gear, braking systems, road wheels, mudguards, etc. used on many of the mobile machines falling in Chapter 84 arc virtually identical with those used on the lorries of Chapter 87, and since their principal use is with lorries, such parts and accessories are classified in this Section." The impugned goods are solely and principally for use in the manufacture of passenger coaches of railways. 5.2 The applicant has cited the following judgements along with submission. ✓ DIESEL COMPONENTS WORKS Vs. COMMISSIONER OF C.EX., CHANDIGARH (IN THE CEGAT, COURT NO. 1, NEW DELHI), 2000 (120) E.L.T. 648 (Tribunal) ✓ S. AUTO INTERNATIONAL LTD. Versus COLLECTOR OF C. EX., CHANDIGARH 2003 (152) E.L.T. 3 (S.C.) ✓ RAIL TECH Versus COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH 2000 (120) E.L.T. 393 (Tribunal) ✓ MECHANICO ENTERPRISES Versus COMMISSIONER OF C.EX., CALCUTTA-II, 1998 (104) E.L.T. 345 ('Tribunal) ✓ C....
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....o Note 3 to Section XVII (Criterion of sole or principal use) and has primarily contended that since the goods manufactured by them are solely and principally for use in the manufacture of passenger coaches of railways, they are specifically classifiable under HSN 8607. Section Note 3 to Section XVII, inter-ilia, prescribes as under: "3. References in Chapters 86 to 88 to "parts" or "accessories" do not apply to parts or accessories which are not suitable for use solely principally with the articles of those. Chapters. A part or accessory which answers to a description in two or more of the headings of those Chapters is to be classified under that heading which corresponds to the principal use of that part or accessory." We have gone through the prevailing GST law in this regard and find that the GST law prescribes that in case of any dispute regarding classification, it is the Customs Tariff, HSN and the Explanatory Notes to HSN that would determine the classification. Before proceeding further, we must go through HSN 8607 and 8415. HSN Code 8607 reads as under: 8507 PARTS OF RAILWAY OR TRAMWAY LOCOMOTIVES OR ROLLING-STOCK -- Bogies, bissel-bogies....
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....under: "This heading covers certain apparatus for maintaining required conditions of temperature and humidity in closed spaces. The machine may also comprise elements for the purification of air. They are used for air conditioning offices, homes, public halls, ships, motor vehicles, etc., and also in certain industrial installations requiring specific atmospheric conditions (e.g. in the textile, paper, tobacco or food industries)." Further, Explanatory Notes to Chapter 84 under Heading 'General' and sub heading `(B) General Arrangement of the Chapter' reads as under: (1)......................... (2) Headings 84.02 to 84.24 cover the other machines and apparatus which are classified mainly by reference to their function, and regardless of the field of industry in which they are used. 7.5 From the above, it can be inferred that Roof Mounted Air Conditioning unit manufactured and supplied by the applicant is squarely covered under HSN 84.15 irrespective of field of industry in which they are used. 7.6 Further, Chapter Note 2 to Chapter 86 of the Customs Tariff states as under: "2. Heading 8607 applies, inter alia, to: (a) ....
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....ories, even if identifiable as being for ships, etc., are therefore classified in other Chapters in their respective headings. The other Chapters of this Section each provide for the classification of parts and accessories of the vehicles, aircraft or equipment concerned. It should, however, be noted that these headings apply only to those parts or accessories which comply with all three of the following conditions: (a) They must not be excluded by the terms of Note 2 to this Section. (see paragraph (A) below). and (b) They must be suitable for use solely or principally with the articles of Chapters 86 to 88- (see paragraph (B) below). and (c) They must not be more specifically included elsewhere in the Nomenclature (see paragraph (C) below). (A) Parts and accessories excluded by Note 2 to Section XVII. This Note excludes the following parts and accessories, whether or not they are identifiable as for the articles of this Section: (1)----------------- (2)----------------- (3)----------------- (4)----------------- (5) Machines and mechanical appliances, and parts thereof, of headings 84.01 t....