In re Bhavya Srishti Udhyog Private Limited (GST AAR Chhattisgarh)
GST classification of the product namely Waterproof tells support for climbing plants manufactured by using bamboo and high – density polythlene
Applicant’s product named “Waterproof Trellis support for climbing. plants using bamboo and High-Density Polyethylene” are not eligible for exemption provided under sr. no. 137 of Notification No. 2/2017-Central Tax (Rate), dated 28-06-2017. The said product merits classification under Custom Tariff Heading 14011000.
FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, CHHATTISGARH
M/s Bhavya Srishti Udhyog Private Limited , Prerna Vidhyalaya Campus, Kritpur Road, Katiya, Bemetara, Chhattisgarh GSTIN- 22AAICB8158P1Z5, [hereinafter also referred to as the applicant] has filed an application U/s 97 of the Chhattisgarh Goods & Services Tax Act, 2017 seeking advance ruling regarding GST classification of their product namely “Waterproof Trellis support for climbing plants manufactured by using bamboo and High-Density Polyethylene”.
2. Facts of the case:-
2.1 The applicant, M/s Bhavya Srishti Udhyog Private Limited, Bemetara, Chhattisgarh holding GSTIN- 22AAICB8158P1Z5 is engaged in manufacturing of waterproof Trellis support for Climbing plants using bamboo and High-Density Polyethylene. The applicant has in their application specified that this invention relates to the field of chemical engineering and Agriculture more particularly a system to design waterproof Trellis suppc5rt for climbing plaits with sturdy bamboo sticks by extending its life span by coating it with High-Density Polyethylene. High-Density Polyethylene is highly resistant to heat, light and water and other forces of nature along with to the stress caused due to pulling and the ability to bend to take the strain due to high winds. The details and specification of the said product has also been furnished as Annexure-I. It has further been specified by the applicant that this invention comprised of a design and mechanism of a trellis support made using bamboo coated with High-Density Polyethylene which is highly resistant to heat, light and water and other forces of nature along with to the stress caused due to pulling. High-Density Polyethylene protects the encased bamboo material from rapid weathering, thus taking advantage of both that is the strength and tensile strength of bamboo and the rugged nature of HDPE respectively. The design has been equipped with a ground anchor to hold the structure steadily into the ground. The ground anchor is made using Nylon 66 plastic which provides great strength and ensures that there is no rotting. The ground anchor has a self-drilling mechanism to make the installation and used of this design of trellis support easy and weather friendly due to its pressure bearing capacity.
2.2 The applicant has also submitted that Garden vegetables and fruits can produce much higher yields when they are allowed to reach the plants’ maximum height. For example, tomatoes, cucumbers, pole beans, squashes and many other vegetables may grow up to heights exceeding 8-10 feet and, in turn, will produce fruit proportionally. Although support devices for garden vegetables are well known, current devices in the market do not provide the area to support plants to this height, nor can these devices typically accommodate multiple plants on the same support device. Many support devices in the market place are not taller than six feet and do not enable the user to adjust the height of the device according to the desired type of plant or specific individual plant and vegetable needs. In addition, current gardening support devices generally lack the structural strength to support plants exceeding five feet in height. Frequently, support devices and garden trellises are made of wood and, in turn, are fastened to the ground using wood stakes. Although treated, these wooden support devices are not fully weather-proof and thus are often subject to rot and excessive wear or splitting over a period of time. Such rot is most often found near the lower end of the wood support or about the stakes due to constant exposure to ground moisture. As a result, such support devices will become out of line, tilt or even break due to winds and/or the weight of the plants. According to the applicant, this invention of trellis support is designed from the utilization of bamboo sticks treated with High Density Polyethylene which is highly resistant to heat, light and water & other forces of nature. The coating ensures that the life of the bamboo support is extended and it provides the required sturdiness without breaking. It avoids any form of impact due to climate ‘change extending the life spans of the support by avoiding rotting at the grounded end. For easy installation of the poles, it has been equipped with a ground anchor which has a self-drilling mechanism.to get the frame easily grounded for the plantation of climber plant.
2.3 Based on the details furnished, the applicant have themselves summarized their product as under:-,
(a) A Trellis support consists of bamboo sticks coated with High-Density Polyethylene to make the bamboo weather proof and to avoid rotting and breaking under any pressure or stress of pulling or others.
(b) The bamboo sticks in a Trellis support are coated with High-Density Polyethylene making it resistant to heat, light and water and other forces of nature.
(c) The Trellis support has self-drilling mechanism designed into a ground anchor for self-installation of the post.
(d) The Trellis support has the ground anchor made using Nylon 66 plastic with glass filled raw material.
2.4 It is in this back drop, that the applicant is seeking ruling regarding GST classification of their aforesaid product named “Waterproof Trellis support for climbing plants manufactured by using bamboo and High-Density Polyethylene”.
3. Contentions of the applicant:-
3.1 That, as per Notification No. 2/2017-Centra Tax Rate) dated 28’h June, 2017, Sr. No. 137 (HSN 8201) “Agricultural implements manually operated or animal driven i.e. Hand tools, such as spades, shovels, mattocks, picks, hoes, forks and rakes; axes, bill hooks and similar hewing tools; secateurs and pruners of any kind; scythes, sickles, hay knives, hedge shears, timber wedges and other tools of a kind used in agriculture, horticulture or forestry other than ghamella” has been exempted.
3.2 Accordingly, in view of the above, applicant’s claim is that their aforesaid product viz. “waterproof Trellis support for Climbing plants using bamboo and High-Density Polyethylene” is a tool used in agriculture, horticulture or forestry and meriting classification under heading 8201 of Custom Tariff Act, 1975, attracting NIL rate of GST.
4. Personal Hearing:-
Keeping with the established principles of natural justice, personal hearing in the matter was extended to the applicant in person, as requested by them and accordingly, Shri Gopal Krishna Tawaniya, Advocate and authorized representative of the applicant appeared before us for hearing on 31.C3.2021 and reiterated their contention. He also furnished a written submission dated 31.03.2021, which has been taken on record.
5. The legal position, analysis and discussion: – At the very outset, we would like to make it clear that the provisions for implementing the CGST Act and the Chhattisgarh GST Act, 2017 (hereinafter referred to as “the CGST Act and the CGGST Act”) are similar and thus, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the CGGST Act, 2017. Now we sequentially proceed to discuss the issues involved in the ruling so sought by the applicant and the law as applicable in the present case.
5.1 As elaborately brought out by the applicant in their application, they are engaged in the making of waterproof Trellis support for Climbing plants using bamboo and High-Density Polyethylene which consists of bamboo sticks coated with High-Density Polyethylene so as to make the bamboo weather proof and to avoid rotting and breaking under any pressure or stress of pulling or others. These bamboo sticks are coated with High-Density Polyethylene making it resistant to heat, light and water and other forces of nature. This Trellis support has self-drilling mechanism designed into a ground anchor for self-installation of the post and it has the ground anchor made using Nylon 66 plastic with glass filled raw material. The applicant in their instant application before us, has opined that the said “Waterproof Trellis support for Climbing plants using bamboo and High-Density Polyethylene” is a tool used in agriculture, horticulture or forestry meriting classification under heading 8201 of Custom Tariff Act, 1975, in terms of Sr. No. 137 (HSN 8201) of Notification No. 2/2017-Centra Tax (Rate) dated 28th June, 2017 attracting NIL rate.
5.2 Thus we proceed to discuss the issues involved regarding classification of their above said product and its applicability to the exemption as provided under Notification No. 2/2017-Centra Tax (Rate) dated 28th June, 2017. We have carefully considered the various submissions made by the applicant and the applicable statutory provisions. The issue before us for determination is whether their product named ‘waterproof Trellis support for climbing plants using Bamboo and High-Density Polyethylene’ supra, falls under “Tariff item”! “sub-heading”/ “heading” / “Chapter” 8201, eligible for exemption from GST as a tool used in agriculture, as claimed by the applicant.
5.3 For sake of reference, the text of aforesaid Notification No. 2/2017-Centra Tax (Rate) dated 28th June, 2017 is reproduced here under:-
In exercise of the powers conferred by sub-section (I) of Section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby exempts intro-State supplies of goods, the description of which is specified in column (3) of the Schedule appended to this notification, falling Linder the tariff item, sub-heading, heading or Chapter, as the case may be, as specified in the corresponding entry in column (2) of the said Schedule, from the whole of the Central tax leviable thereon under Section 9 of the Central Goods and Services Tax Act, 2017 (12 of 2017).
SCHEDULE
