In re Narendrakumar Manilal Patel (National Health Care (GST AAR Gujarat)
In this case, we find that the entry No. 257 of Schedule-I of Notification No.01/2017-Central Tax(Rate) dated 28.06.2017 provides a more specific description of the product manufactured and supplied by the applicant as there is a specific entry of ‘Urine Collection Bag’ at Entry No.8 of List 3(E) appended to the said Schedule whereas the Entry No.218 in Schedule-II of aforementioned Notification provides only a general description i.e. instrument/appliance used in the medical sciences. Therefore, in light of the aforementioned discussions as well as in light of Rule 3(a) of the General Rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), we conclude that the product ‘Urine Collection Bags’ manufactured and supplied by the applicant fall under Entry No.257 of Schedule-I of Notification No.01/2017-Central Tax(Rate) dated 28.06.2017 and the GST liability on it is 5% (2.5% + 2.5%).
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, GUJARAT
The applicant M/s. Narendrakumar Manilal Patel (National Health Care) vide their application for Advance Ruling has submitted that they are engaged in the manufacture and trading of Urine collection bags falling under HSN Code 90189099. They have stated that the Urine collection bags are covered under Serial No. Entry (8) of List 3 of Entry 257 of Schedule-I of Notification No:01/2017-Central Tax (Rate) dated 28.06.2017 attracting GST at the rate of 5%; that the subject goods is for disabled in the nature of Urine collection bags falling under HSN Code 90189099; that corresponding Column (3) to Entry No.257 of Schedule-I of the aforementioned Notification reads as “Assistive devices, rehabilitation aids and other goods for disabled, specified in List 3 appended to this Schedule”; that on a plain reading of entry at Serial No.E(8) of List 3 of Entry 257 of Schedule-I and General Entry at Serial No.218 of Schedule-II of Notification No.01/2017-Central Tax (Rate), it is evident that Urine collection bags are specifically covered under the entry at Serial No.E(8) of List 3 of Entry 257 of Schedule I whereas the entry at Sr.No.218 of Schedule-II is a general entry that covers all instruments and appliances used in medical, surgical, dental or Veterinary sciences including scientigraphic apparatus, other electro medical and sight-testing instruments and the GST liability under the said heading is 12% (6% SGST + 6% CGST).
2. The applicant have further stated that for the purpose of classification and the determination of applicable rate for a supply of goods under the CGST Act, 2017, the various Chapter Headings, sub-headings, Interpretative Rules and Chapter Notes under the Customs Tariff Act, 1975 has been adopted by Notification No.01/2017-Central Tax (Rate) dated 28.06.2017 and the explanation appended to the above Notification reads as follows:
“(iii) “Tariff item”, “sub-heading” “heading” and “Chapter” shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975).
(iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of this notification.”
2.1. The applicant has further stated that accordingly, the appropriate classification as determined under the Customs Tariff Act, 1975 including on an application of the Chapter Notes and General Explanatory Notes, would apply for the purpose of levy of GST. As per Rule 3 of the General Rules for Interpretation of Import Tariff the heading that provides the most specific description shall be preferred to headings providing a more general description. Rule 3 reads as follows:
“Rule 3 – When by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows: (a) The heading which provides the most specific description shall be preferred to headings providing a more general description.”
2.2.The applicant has also stated that in view of the above, Urine collection bags are clearly and most specifically covered under Sr.No.E(8) of List 3 of Entry 257 of Schedule-I attracting 5% GST; that there is a similar entry under Sr.No.578-List 30 of Entry E(8) of Notification No.50/2017-Customs dated 30.06.2017 where the effective rate of Basic Customs Duty is NIL and the entry is reproduced below:
