GST – AAR Gujarat: Geomembranes being used for water proofing in ponds, and for agricultural application satisfy to be a textile article as per Chapter 59 Note 7(1Xa) hence classifiable under HSN 59111000 [Order attached]
Order Date – 18 October 2022
Key Pointers –
- The Applicant, M/s Shree Ambica Geotex Pvt. Ltd., is engaged in the business of manufacture and sale of textile products and articles like Geomembranes. The applicant has submitted that it also produces intermediate products like Tapes/Strips, but almost entire quantity of these intermediate products is used within the factory in relation to manufacture of the final products, viz. Geomembranes.
- However, the products are basically in the nature of fabrics, and they water proofing in ponds, and for agricultural applications. The BIS has laid down specifications for different types of woven Geomembranes. The applicant has BIS licence to manufacture different types of woven Geomembranes.
- The Issue involved here is whether the product Geomembrane is classifiable under Heading 5911 Sub Heading 59111000, as textile products and articles for technical uses?
- The AAR finds that it is used in aquaculture ponds teamed with Biofloc technology which is a highly beneficial bacterial colony based culture which keeps diseases at bay making it an ecologically sustainable symbiotic system. For Biofloc technology to be used, Geomembranes lined ponds are a must.
- It was held that from the technical uses of Geomembrane, Geomembrane passing the test of Section note XI(l)(g) to Section XI, Geomembrane satisfying the test of Chapter 59 Note 7(1Xa); hence 'Geomembrane' is a textile article.
- The AAR relying on the decision of Authority for Advance Ruling, Gujarat in case of M/s. Texel lndustries Ltd. vide Advance Ruling No. GUJ/GAAR/R/20221 held that the product viz. Geomembrane merits classification under HSN 59111000.