In re Oriental Carbon & Chemicals Ltd. (GST AAR Haryana)
Although, the applicant has submitted that it is supplying the goods in question in domestic market (i.e. within the Country) under the heading 2802 and charging GST @ 18% and intends to continue doing same yet it doesn’t seem logical that the same good for the purpose of export out of country may be classified under different headings. Moreover, the applicant has failed to provide any logical reason on which basis his goods may be said to fall in more than one heading even under the application of interpretation rules.
H.S. code system seeks to provide a universal system of classification and purpose is to ensure that each product can be simply and unequivocally assigned under a single heading and sub-heading and the general rules of interpretation are provided to achieve this objective.
General Interpretative Rule 1 is the foremost rule of classification. It specifies the elements that can legally be used to classify products. These identified elements are the terms of headings, Section or Chapter Notes, and if not classified by the two elements above, the remaining General Interpretative Rules.
General Interpretative Rule 2 is in two parts. It seeks to ensure that articles and products are not left unclassifiable by reason of being incomplete, unfinished, unassembled or disassembled, mixed or made of multiple materials.
General Interpretative Rule 3 provides classification principles for goods which, prima facie, fall under two or more headings. It has three parts which are applied sequentially until a classification is determined.
General Interpretative Rule 4 deals with goods which (for example because they have just appeared on the world market] are not covered by any heading of the Harmonized System, even by the material that they are made from. In the unlikely event it is needed, this GIR provides for classification with the goods to which are most similar in nature. General Interpretative Rule 5 relates to containers and packaging for goods.
Finally, General Interpretative Rule 6 requires the whole process to be repeated again as a separate exercise to choose the five-digit subheading and then again for the six-digit subheading level as required.
In light of application of above rules, there seems no possibility that any goods may be classified under more than one heading / sub-heading and therefore, there seems no rationale to allow use of different codes for a commodity while exporting.
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, HARYANA
