In re Royal Carbon Black Private Limited (GST AAR Maharashtra)
Question. What is the (HSN) classification of Tyre Pyrolysis Oil and what is Current rate of tax applicable?
Answer: – The said question cannot be answered in view of non-submission of full details by the Applicant as mentioned under the Observations and Findings section of the order.
Read AAAR Order: AAAR Maharashtra directs AAR to pass ruling on Merits
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, MAHARASHTRA
The present application has been filed under Section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MOST Act” respectively ] by ROYAL CARBON BLACK PRIVATE LIMITED, the applicant, seeking an advance ruling in respect of the following questions.
What is the (HSN) classification of Tyre Pyrolysis Oil and what is Current rate of tax applicable?
At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression `GST Act’ would mean CGST Act and MGST Act.
2. FACTS AND CONTENTION — AS PER THE APPLICANT
The submissions made by the applicant is as under:-
2.1 M/s Royal Carbon Black Pvt. Ltd., the applicant, has raised the question regarding classification of Tyre Pyrolysis Oil and the rate of tax applicable thereon. The manufacturing process and a test report in respect of the impugned product i.e. Pyrolysis Oil is submitted.
2.2 As per the submission, Tyre is made out of 30% to 35% Carbon, 35% to 40 % rubber and 10% to 15% steel. Once the tyres are removed from the car it becomes a waste. This waste is recycled by the applicant and the rubber component of the tyres is converted into oil which can be used for heating purposes and can be called as pyrolysis oil. Like Biodiesel, Pyrolysis oil can also be sold in similar applications as a liquid fuel.
2.3 Applicant has submitted that pyrolysis oil should be qualified as either a Biodiesel (HSN 3826) as it is derived from rubber part of the Tyre which is renewable in nature just like Palm Oil made from Palm fruit used to make biodiesel or as a Marine Fuel (HSN 2710) as its specifications meet that of Marine fuels.
3. CONTENTION — AS PER THE JURISDICTIONAL OFFICER:
3.1 The jurisdictional officer has submitted a table as under and has stated that Pyrolysis oil is widely used as an industrial fuel to substitute furnace oil or industrial diesel. Pyrolysis oil is mainly used in Machines that do not require high quality fuel oil. Biodiesel is typically made by chemically reacting lipids (all organic sources) and pyrolysis oil is made of inorganic sources, hence cannot be treated as Biodiesel.
