Page 122 - GSTL_6th August 2020_Vol 39_Part 1

48 GST LAW TIMES [ Vol. 39
(g) Chenille Yarn : As per the write up given by the applicant, the
products are very much identifiable in the respective Chapter sub-
heading 5606 as “Chenille Yarn”, which attracts GST rate of 12%.
(h) Poly Propylene Extrusion Yarn/(i) Poly Propylene Texturized
Yarn/(j) Polyester Texturized Yarn : These are all “Synthetic Fila-
ment Yarns” and clearly identifiable in the respective Chapter Sub-
heading 5402, which attracts GST rate of 12%.
5. We have carefully examined the oral and written submissions made
by the Applicant and also comments furnished by the Jurisdictional authority,
the Commissioner, Coimbatore Commissionerate. The question raised seeking
ruling and is to be decided is :
What is the correct classification and rate of GST applicable on supply of
the following Goods?
Knitted Fabrics; Woven Fabrics; Woven Fabric bonded with Non-woven
Fabric; Covers for pillow, latex block, mattresses; Foot Runner; Pillow
Sheet; Chenille Yarn; Poly Propylene Extrusion Yarn; Poly Propylene
Texturized Yarn; Polyester Texturized Yarn.
6.1 The applicant is a Private Limited Company and are into manufac-
turing Knitted Fabric, Woven Fabric, woven Fabric bonded with Non-woven
Fabric, made-ups, Chenille Yarn, PP Extrusion Yarn, PP Texturized Yarn and
Polyester Texturized Yarn. They have sought the classification and the rate of
GST applicable on the goods manufactured and supplied by them. The applicant
has furnished the manufacturing process of each goods and the classification ap-
plicable to their goods as per their interpretation.
6.2 In terms of explanation (iii) and (iv) to Notification No. 1/2017-
Central Tax (Rate), dated 28-6-2017, tariff heading, 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 and the rules for
the interpretation of the First Schedule to the Customs Tariff Act, 1975, including
the Section and Chapter Notes and the General Explanatory Notes of the First
Schedule shall be applied for the interpretation and classification of goods. Fur-
ther HSN being a reliable source based on which Customs Tariff is structured,
gives a detailed description of the products classified under a particular heading.
Considering all the submissions, we take up the classification of the products.
7.1 Knitted Fabrics : The raw material used is Yarn-Polyester, Cotton,
Poly Propylene Yarn. The manufacturing process involves interloping of yarns
through loop formation in Jacquard Knitting Machine, which is softened using
chemicals applied on the padder of the stenter machine, through which the fabric
is run. After process, inspection is done and the fabrics are supplied. The appli-
cant has opined that the product is classifiable under CTH 60. The test report
298/2019-20 of the Regional Laboratory, Textiles Committee states that the sam-
ple described as ‘Knitted Fabric’, is of Polyester (100%), Weft Knit Fabrics of
yarns of different colours and the applicable HS code 6006.33 - Other knitted fab-
rics, of synthetic fibers’, of yarns of different Colours. In the submissions, it is
stated as raw material used is yarn-Polyester, cotton, Polypropylene Yarn. From
the input purchase invoice, it is seen that they procure 1200 Denier Yarn, 600 De-
nier Yarn, 900 Denier Yarn 20s Polyester Yarn, 30s Polyester Yarn, 150 Dyed
Yarn.

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