In re Arti Pitaliya (GST AAR Rajasthan)
The matter before the Authority for Advance Ruling Rajasthan concerned an application filed by an applicant engaged in the manufacture and trading of rubber parts used in agricultural irrigation systems, particularly sprinkler and drip irrigation systems. The applicant sought an advance ruling regarding the classification and applicable GST rate on rubber rings that are used as components in such irrigation systems.
The applicant manufactures rubber rings designed to be used as sealing or connecting parts in sprinkler and drip irrigation systems. These rings are manufactured through a process involving mixing, moulding and curing of rubber, resulting in vulcanized rubber products. The applicant stated that the rings are dimension-specific and application-specific, designed exclusively to fit particular sprinkler or drip irrigation components and have no independent use outside such systems. The products are supplied both as part of complete irrigation systems and separately as replacement spares to farmers, original equipment manufacturers, traders, and other users.
The issue raised by the applicant was whether rubber rings made of vulcanized rubber should be classified under heading 4016 as “other articles of vulcanized rubber” attracting GST at 18 percent, or whether they should be classified under heading 8424 as parts of sprinkler or drip irrigation systems, attracting a concessional GST rate applicable to such systems. The applicant relied on Entry No. 195B of Schedule II of Notification No. 1/2017-Central Tax (Rate), inserted through Notification No. 06/2018 dated 25.01.2018, which covers “sprinklers; drip irrigation system including laterals; mechanical sprayers.” The applicant also referred to various circulars clarifying that parts suitable for use solely or principally with sprinklers or drip irrigation systems fall under heading 8424.
