TaxTMI 
TaxTMI 
2022 (10) TMI 307
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....y having Fishing Vessels/Boat and is engaged in fishing activities. The Combined Wire Rope having HSC code 7312 and specification 14mm diameter and construction 6xl9SCF supplied to those Customers for its usage primarily and solely as a part of Fishing Vessels having HSN code 8902. 4. The applicant has submitted that Combination Wire Rope with steel core, stainless steel (red tracer yam) PP-coated combination ropes are used by in trawl fishing all over the world. These ropes also are known as "Taifun Ropes". 5. The applicant has submitted that the goods of any chapter heading used as a parts of Fishing Vessels having chapter heading 8902 are eligible for 2.5% CGST as per Sr.No.252 of Schedule -I of Notification No. 1/2017-Central Tax (Rate).2.5% SGST vide corresponding Notification issued by Gujarat State Government and 5% IGST Notification No.1/2017-ITR. The said serial number is reproduced as under. Schedule-I Sr.No. Chapter/ Heading/ Subheading/ Tariff item Description of goods Rate 252 Any Chapter Parts of the Goods of heading 8901, 8902, 8904. 8905, 8906, 8907 2.5% 6. The applicant has submitted the Photos of applicant product as follows: ....
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.... ships and other vessels for processing or preserving fishery products: 8902 00 10 --- Trawlers and other fishing vessels 8902 00 90 --- Other 9.1 Further, Sr.No.247 of Schedule-1 of the Notification 1/2017-Central Tax (Rate) prescribes that the "Fishing Vessels; factory ships and other vessels for processing or preserving fishery products" classifiable under Chapter Heading 8902 are attracting 5% [2.5% CGST+ 2.5% SGST] and Sr.No.252 of Schedule-I of the said notification prescribes that "goods of any chapter" if used as ''parts of the goods of heading 8902" is also attracting 5% [2.5% CGST+ 2.5%SGST]. Rope is basic parts of Fishing Boat. 10. The applicant submit that there is difference between Vessels and Fishing Vessels. As the very name suggests. Fishing Boats/Vessels has a specific purpose i.e. of Fishing for which usage of. Fishing net is must. The fishing net is tied and hooked with Fishing Vessels with the help of Combined Wire Rope. 10.1 The basic parts of Fishing Boat are available for reference is downloaded from https://www.galatiyachts.com/yachting-news/parts-of-a-fishing-boat-valhalla-boatworks- center-console/ is scanned and pasted as ....
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....nce (Department of Revenue), Central Board of Indirect Taxes & Customs. New Delhi wherein at para 10.1 and 10.2 it is clarified as under.- 10.1 Applicability of GST on marine engine: Reference has been received seeking clarification regarding GST rates on Marine Engine. The fishing vessels are classifiable under heading 8902. and attract GST @5%, as per S. No. 247 of Schedule-1 of the notification No. 1/2017-Central Tax (rate), dated 28-6-2017. Further, parts of goods of heading 8902. falling under any chapter also attracts GST rate of 5%, vide S. No. 252 of Schedule I of the said notification. The Marine engine for fishing vessels falling under Tariff item 8408 1093 of the Customs Tariff Act, 1975 would attract a GST rate of 5% by virtue of S.No. 252 of Schedule-1 of the notification No. 1/2017-Central Tax (Rate), dated 28-6-2017. 10.2 Therefore, it is clarified that the supplies of marine engine for fishing vessels (being a part of the fishing vessels, falling under tariff item 8408 10 93 attracts 5% GST. 10.4 Though the aforesaid circular is clarification for "Marine Engine" used for Fishing Vessels, the ratio of the said circular is applicable in the applic....
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....Paper core, however, cannot be said to be used in the manufacture of paper in sheets as component part. 15. In Modi Rubber Ltd. v. Union of India, (1997) 7 SCC 13. the appellant had set up tyre and tube manufacturing plant and imported various plants and machineries. While using the plants and machineries. PPLF (Polypropylene Liner Fabric) was used as a device in the form of liner components to various machinery units to protect the rubber-coated tyre fabric from atmospheric moisture and dust. This Court held that the PPLF was not a component of the machine itself. It was not a constituent part. It was used as a Liner Fabric not only in tyre production but also in similar other industrial processes 12. The applicant has submitted that the test laid down by the Hon'ble Supreme court to determine what is component or part of an article in the aforesaid case is clearly applicable in the instant case. The Combined Wire Rope which constitutes its essential nature without which Fishing Vessels cannot function for Fishing activities in other words without which Fishing Vessels cannot be manufactured and is an integral part of the Fishing Vessels. 13. The applicant has p....
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....tal Bush/Bearing, Stuffing Box, Brass Tube/SS tube. Rudder shaft and blade. Sea cork/Water strainer, GM Gate Valve, MS Pipe, Propeller Nut/GM Nut, Coupling, SS Rods & Square, SS Fiat, GM Gland and Ring and MS Plate used in fishing or floating vessels? The authority for Advance Ruling Kerala in their order Advance Ruling No. KER/50/2019, dated 15-7-2019 reported at 2019 (28) G.S.T.L. 191 (A.A.R. - GST) has ruled that "Propeller. Shaft/SS road. Gun metal bush/bearing, Stuffing box. Brass Tube/SS Tube, Rudder Shaft and Blade, Sea Cork/Water Strainer, GM Gate Valve, MS Pipe, Propeller Nut/GM Nut. Coupling, SS Rods Square, SS Flat, GM Gland and Ring and MS Plate used as parts of fishing/floating vessels come under the HSN Code 8902 and are taxable @ 5% (2.5% CGST + 2.5% SGST) under Serial No. 252 of First Schedule of the Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017 (SRO. No. 360/2017, dated 30-6-2017)." Here it is pertinent to note that the goods for which ruling was sought for does not having exclusive use in the Fishing Vessels, however when it use as a part of warships, it was ruled by he Authority that the applicability ofSr.No.252 of the notification ibid co....
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....s of such goods and thereby taxable @ 5% GST per Serial No. 252 of Schedule 1 of the Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017. If it is used for some other purpose, the applicable tax rate would be as per their respective TSH 8408 and 8483 at the rate of 28% GST as per SI. Nos. 115 and 135 of the said notification. It is submitted by the applicant that the authority observed that goods for which ruling was sought for. it is categorically ruled that if the said goods is used for Fishing Vessels it will attract GST @ 5%, however if it is used elsewhere it will attract GST @ of 28% (v) In the case of DHARSAK. V.P. reported at 2018 (13) G.S.T.L. 426 (A.A.R. - GST) where in the Authority for Advance Ruling. Kerala has held that:- Parts of Fishing/Floating Vessels - Classification and taxability under GST - Advance Ruling thereon - Various parts such as marine propellers, rudder set, stern tube set, propeller shall and M.S. Shaft for couplings are supplied by applicant specific for use in said vessels and cannot be called general purpose parts - Hence, these are covered under Entry No. 252 of Schedule I of Notification No. 1/2018-C.T. (Rate),....
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....sing or preserving fishery products. The applicant made application for benefit of Sr. No. 252 of Schedule-I of the Notification No. 01/2017-Central Tax (Rate), corresponding Notification issued by the Gujarat Government and want to charge / pay GST on supply of the subject goods @ 5% instead of @18%. Relevant portion of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 is reproduced below; In exercise of the powers conferred by sub-section (1) of section 9 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby notifies the rate of the central tax of- i. 2.5 per cent, in respect of goods specified in Schedule I, ii.------------- iii. -------------- iv. -------------- v. -------------- vi. -------------- appended to this notification (hereinafter referred to as the said Schedules), that shall be levied on intra-State supplies of goods, the description of which is specified in the corresponding entry in column (3) of the said Schedules, falling under the tariff item, sub-heading, heading or Chapter, as the case may be, as speci....
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.... Applicant in their application for advance ruling as well as the submissions made by authorised signatory, during the personal hearing proceedings on 2-8-22 before this authority. We also considered the issue involved, on which advance ruling is sought by the applicant, relevant facts & the applicant's interpretation of law. 20. At the outset we would like to make it clear that the provisions of CGST Act and GGST Act are in '"pari materia" and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the GGST Act. 21. We find that the applicant is supplying the Combined Wire Ropes mainly to such customers having Fishing Vessels/Boat and are engaged in Fishing activities. The main issue here is to decide whether the Combined Wire Ropes is a part of fishing vessel or otherwise. 22. We find that the applicant is Authorized wholesale dealer for supply of Combined Wire Rope manufactured by M/s Kadambari Steel Wire Rope Pvt. Ltd and M/s Usha Martin Indi....
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....f India wherein it have laid down the test to ascertain what is parts in case of Saraswati Sugar Mills v. Commissioner of Central Excise Civil Appeal No. 5295 of 2003. decided on 2nd August, 2011 [2011 (270) E.L.T. 465 (S.C.)] Hon'ble Supreme Court of India observed:- 11. The meaning of the expression 'components' as defined in the dictionary is accepted and adopted by this Court in the case of Star Paper Mills v. Collector of Central Excise - (1989) 4 SCC 724 - 1989 (43) E.L.T. 178 (S.C.); and the same is quoted with approval in CCE v. Allied Air Conditioning Corporation - 2006 (202) E.L.T. 209 (S.C.). 12. In order to determine whether a particular article is a component part of another article, the correct test would be to look both at the article which is said to be component part and the completed article and then come to a conclusion whether the first article is a component part of the whole or not. One must first look at the article itself and consider what its uses are and whether its only use or its primary or ordinary use is as the component part of another article. There cannot possibly be any serious dispute that in common parlance, componen....
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....ed wire Rope is not a Part of the fishing Vessel. 26. We. now refer to the entry No. 252 of Notification No. 1/2017-CT (Rate) dated 286-2017 as amended and same is reproduced as follows : Schedule-I Sr. No. Chapter/ Heading/ Subheading/ Tariff item Description of goods Rate 252 Any Chapter Parts of the Goods of heading 8901, 8902, 8904, 8905, 8906. 8907 2.5% As per the said entry Parts of goods of chapter heading 8901, 8902, 8904, 8905, 8906, 8907 attracts CGST @ 2.5%. Fishing Vessel are classified under CTH No. 8902 of Customs Tariff and same is read as under : 8902 FISHING VESSELS; FACTORY SHIPS AND OTHER VESSELS FOR PROCESSING OR PRESERVING FISHERY PRODUCTS 8902 00 - Fishing vessels; factory ships and other vessels for processing or preserving fishery products : 8902 00 10 --- Trawlers and other fishing vessels 8902 00 90 --- Other 26.1 The applicant has argued that Combine Wire Rope is a part of fishing vessel and therefore is eligible for the GST rate @ 5 % under entry at Sr. No. 252 of the Not. No. 1/2017-CT (Rate) dated 28-6-2017. We have already discussed in the above paras that Combine Wire Rope is not a part of f....
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....hing net with the vessel for fishing in the sea/lake. Hence applicant goods Combined Wire Rope is not essential/integral part of fishing vessel but it is used in the fishing net for the fishing. 29. We find that the applicant has placed reliance on the following Advane Ruling pronounced by the various authority of Advance Ruling.- (i) The Authority of Advance Ruling, Maharashtra In the case of Excide Industries Ltd vide Order No. GST-ARA-39/2020-21/B-58, dated 9-9-2021 in Application No. 39 reported at 2021 (55) G.S.T.L. 195 (A.A.R. - GST - Mah.) has answered in affirmative to the question "Whether the supply of batteries by the required applicant for the use in warships such as submarines of the Indian Navy falls under Entry 252 of Schedule I to Notification No. 1/2017-Integrated Tax (Rale), dated 28-6-2017 and hence is taxable @5% GST?" (ii) The Authority for Advance Ruling, Karnataka in the case of SR Propellers Pvt. Ltd in their order KAR ADRG 78/2019. dated 24-9-2019 reported at 2019 (31) G.S.T.L. 382 (A.A.R. - GST) has ruled that "The concessional rate of 5% GST in terms of Entry Number 252 of Schedule I to the Notification No. 01/2017-Central Tax (Rate), dated 28-6-....
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.... falling under TSH 8483 when supplied for use in vessels/goods falling under Headings 8901, 8902, 8904. 8905. 8906, 8907 will be deemed to be parts of such goods and thereby would be taxable @ 5% GST as per SI. No. 252 of Schedule I of the Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017. If it is used for some other purpose, the applicable tax rate would be 28% GST as per SL No. 135 of the said notification. (c) Whether the Marine Diesel Engine (TSH 8408) and Gear Box (TSH 8483) of Customs Tariff Act, 1975 as adopted to GST can be treated as parts of Headings 8902. 8904, 8905, 8906 and 8907 attracting 5% of IGST (2.5% CGST + 2.5% SGST) as per Serial No. 252 of Schedule I of the Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017 or not? The marine diesel engine and gear boxes supplied for use in vessels/goods falling under Headings 8901, 8902, 8904, 8905, 8906, 8907 will be deemed to be parts of such goods and thereby taxable @ 5% GST per Serial No. 252 of Schedule I of the Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017. If it is used for some other purpose, the applicable tax rate would be as per their respective TSH 8408 and 8483....