GST – AAR Karnataka: The products "Satin Rolls" and "Taffeta Rolls" with sizes between 19mm to 40mm, made up of manmade fibers are classifiable under tariff heading 5807 10 20, taxable @12% [Order attached]
Order date – 29 November 2022
Key Pointers –
- The applicant, M/s. Mean Light Co. a proprietary concern registered under GST, are the dealers of the products i.e. Satin Rolls and Taffeta Rolls which are not printed and are useful as label rolls for the purposes of printing wash care instructions & fabric contents
- Further some of their vendors classified the said product under HSN 5806, which attracts GST rate of 5% and some others under HSN 5807 that attracts GST rate of 12%.
- The issue involved here is whether the Satin Rolls and Taffeta Rolls with sizes between 19 mm to 40mm are classified under 5% or 12%?
- The AAR examined the Explanations (iii) and (iv) appended to the Notification No. 01/2017- Central Tax (Rate), dated 28.06.2017, and Chapter Note 5 of Chapter 5806 of the first schedule to the Customs Tariff Act, 1975 held that the impugned products qualify to get covered under “Narrow Woven Fabrics”.
- It is an admitted fact that the impugned products are woven products consisting of wrap and weft and are not assembled by means of an adhesive. Thus the products are not covered under tariff heading 5806.
- The AAR also finds that the impugned products are narrow woven fabrics made up of manmade fibers i.e. Polyester yarn and thus are squarely covered under tariff heading 5807 10 20.