Page 126 - GSTL_6th August 2020_Vol 39_Part 1

52 GST LAW TIMES [ Vol. 39
1/2017-C.T. (R), dated 28-6-2017, provides the rate for Woven Fabric for man-
made textile fabrics’ falling under CTH 5407, 5408.
The applicable rate is 2.5% CGST provided vide Sl. No. 217 of Schedule I
of Notification 1/2017-C.T. (R), dated 28-6-2017 as amended and 2.5% SGST pro-
vided vide S. No. 217 of Schedule I of Notification No. II(2)/CTR/532(d-4)/2017
vide G.O. (Ms) No. 62, dated 29-6-2017
7.3 Woven Fabrics Bonded with Non-Woven Fabric : The raw material
used is Yarn-Polyester, POY, Chenille sourced from various mills. The applicant
has stated that the yarn is warped at first and weaving is done in the jacquard
machines. After weaving, Poly Propylene non-woven fabric falling under CTH
5603 is bonded with the woven fabric at the back side, using heated licocene Glue
(PP glue). Then on inspection the fabric is supplied. The applicant has opined
that the product will fall under CTH 5407. The Test report 299/2019-20 describes
the sample as Woven Fabric with back end (Non-Woven) and the test result
states that woven - one direction Polypropylene, other direction Polyester with
composition 60% polyester and 40% Polypropylene and Non-Woven portion -
one direction polypropylene with 100% Polypropylene composition. The report
describes the product as ‘60% Polyester 40% Polypropylene Woven Filament
Yarn Fabrics of yarns of different colours assembled in layers with 100% Poly-
propylene Non-Woven’ and the applicable HS Code 5407.73 - Woven Fabrics, of
synthetic filament yarn, other woven fabric, containing 85% or more by weight of
synthetic filaments of yarns of different colours’.
It is observed that the final product consists of two textile material i.e.
woven & Non-Woven fabric, the goods are sold in market is woven fabric as it is
the base material. As per the General Rules of Interpretation for HSN the classifi-
cation of goods consisting of more than one material or substance shall be ac-
cording to the principles of Rule 3. Rule 3a states that
The heading which provides the most specific description shall be preferred
to headings providing a more general description. However, when two or
more headings each refer to part only of the materials or substances con-
tained in mixed or composite goods or to part only of the items in a set put
up for retail sale, those headings are to be regarded as equally specific in re-
lation to those goods, even if one of them gives a more complete or precise
description of the goods.
Also, Section XI Note 2A of Customs Tariff Act states that Goods classifiable in
Chapters 50 to 55 or in Heading 5809 or 5902 and of a mixture of two or more
textile materials are to be classified as if consisting wholly of that one textile ma-
terials which predominates by weight over any other single textile material.
In the case of the product at discussion, the woven fabric made of syn-
thetic filament yarn is the predominant material and the Non-woven fabric is
bonded to strengthen the product, woven fabric. Applying the Section Note 2A
above, Woven fabric being predominant, the product is classifiable as ‘Woven
Fabric’ under CTH 5407. As already stated in Para 7.2, the classification is re-
stricted to four-digit level and accordingly concluded that the product Woven
Fabric backing with Non-Woven Fabric falls under CTH 5407. The applicable
rate is 2.5% CGST provided vide Sl. No. 217 of Schedule I of Notification 1/2017-
C.T. (R), dated 28-6-2017 as amended and 2.5% SGST provided vide S. No. 217 of
Schedule I of Notification No. II(2)/CTR/532(d-4)/2017 vide G.O. (Ms) No. 62,
dated 29-6-2017.

GST LAW TIMES  6th August 2020  126