Order date: 10 February 2023

Parties: Mega Flex Plastic Ltd. & ANR. V/s Union of India & ORS.

Facts –

• The Petitioner Mega Flex Plastic Ltd is a manufacturer of Polypropylene Leno Bags by weaving polypropylene strips (tapes), before the introduction of the Goods and Services Tax Act, 2017, he had voluntarily declared its finished product and enjoyed duty drawbacks.
• Except rate of tax no cogent reason has been shown by petitioner as to why and how Tariff heading of same product same classification sought to be changed from classification of product under new GST regime, same has been disallowed by authorities. Therefore, this petition is filed.

Issue –

• Whether petitioner’s request to change product classification, correct?

Order –

• The Hon’ble High Court observed that Petitioner has changed Tariff Heading 3923 29 90 for claiming duty drawback, and no explanation could be offered as to why the Tariff Heading should be changed now to 6305 33 00, it is not permissible under the doctrine of equitable estoppels.
• In the instant case moot point is that the Bags/sacks are not manufactured out of textile material as defined under 6305 of the Tariff Act and woven strips manufactured out of Polypropylene (i.e., made of plastics) as defined under 3923.
• It was held that the impugned goods are clearly classified under Chapter heading 3923 and cannot be termed as Textile or Textile Products. it would not be proper to consider the same to be classified under Chapter 6305 33 00.
• Accordingly, issue is decided in favour of authorities against petitioner by holding that the goods are classifiable under Chapter 39 of the Tariff Act being the plastic articles and the reasoning given by the aforesaid Appellate authorities finds convincing to the Court.