Gujarat Authority for Advance Ruling: In an application sought for advance ruling on the question that, what is the Harmonized System of Nomenclature (HSN) and Goods and Services Tax (GST) rate of Kirloskar power sprayer, the two-member bench Milind Kavatkar and Amit Kumar Mishra has ruled that the 8-digit HSN code of the applicant’s product is 8424 89 90 and the applicable GST rate would be l8 percent.
The issue before the Authority is to decide the classification and applicable GST rate of the power-driven mechanical sprayer.
The applicant submitted that in the GST Tariff, mechanical sprayer is classified at 12 percent with tariff heading 8424 in the Notification No. 1/2017 of Central tax (Rate), however, agriculture and horticulture sprayer is classified at 18 percent GST.
The Authority noted that the applicant was procuring Horizontal Triplex Plunger (HTP) sprayer from importers or domestic manufacturers and engines from other vendors to manufacture H’TP Kirloskar power sprayer and the major parts used in manufacture of the sprayer are Petrol engine, base frame made of steel, V pully and power sprayer. Further, it noted that the sprayer is a mechanical pumping system which develops the required pressure to spray water and other liquids and its application is in agriculture field and other fields.
However, the applicant has submitted that the impugned goods can be used in any field as per their application can be used in various places as per the requirements and does not have exclusive used in agriculture and horticulture only.
The Authority has observed that there is no dispute to the classification of product, which would be under chapter head 8424 of the GST Tariff, as this heading covers machine and appliance for projecting, dispersing or spraying steam, liquids or solid materials. Thus, it was held that HTP Kirloskar Power Sprayer based on the use, merits classification under Harmonized System of Nomenclature (HSN) 8424 89 90, that provides for mechanical appliances (whether or not hand-operated) for projecting, dispersing or spraying liquids or powders; spray guns and similar appliances; steam or sand blasting machines and similar jet projecting machines other than fire extinguishers.
Moreover, it was observed that, Central Board of Indirect Taxes and Customs (CBIC) vide Circular No. 113/32/2019-GST has issued clarification on applicable GST rate on mechanical sprayer, that says all goods of heading 8424 attract GST at 18 percent. Thus, it was held that the applicant goods appear at Entry No. 325 in Schedule-III of the Notification No. 1/2017 of Central Tax (Rate), on which the applicable rate of GST is 18% (9% SGST + 9% CGST).
[Kirloskar Oil Engines Ltd., In re, 2022 SCC OnLine Guj AAR-GST 25, decided on 28.09.2022]
Advocates who appeared in this case :
Present for the applicant: Senior General Manager P. Ghosh
Senior Officer Y.M. Pandya