2018 (9) TMI 690 – AUTHORITY FOR ADVANCE RULING, DAMAN, DIU AND DADAR AND NAGAR HAVELI – 2018 (17) G. S. T. L. 350 (A. A. R. – GST) – Classification of activity – printing of leaflet – supply of goods or supply of services – mixed supply – whether the goods/service (under question) has to be considered as supply of goods falling under Chapter Sub-heading No.4901 or as a supply of service falling under SAC No.9989?
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Held that:- It is on record that the applicant have submitted one of the sample of a printed pamphlet along with their defence reply which is made for “Norethindrone tablets USP,0.35 mg”. On simple reading of the said pamphlet it appears that the buyer of the product wanted to convey certain message through the said pamphlet which is supplied alongwith their product. In fact, the product pamphlet in itself is nothing but a media to convey the message and the message or script what is to be printed, is supplied by the buyer of the product. The said supply is a mixed sup
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category of Supply of Service falling under SAC No.9989. – Order No. 02/AR/SK-CP/ Daman/2017-18 Dated:- 28-5-2018 – SHRI SATISH KUMAR AND CHARMIE KAMAL PAREKH MEMBER M/s Temple Packaging Pvt Ltd, Survey No 171/3 &7, Behind Olive Healthcare, Hatiyawad, village- Dabhel, Nani Daman – 396210. Having GSTIN Number 251800000005AR4, is engaged in the printing of leaflets (further divided as insert/outsert) .They have made an application on 19.03.2018 under advance Ruling for printed leaflet supplied by the Applicant to ascertain the correct classification as to whether the same falls under the category of supply of goods falling under CHS No. 4901 or supply of service under SAC No.9989 and for that they have paid the required fee amounting to ₹ 5,000/- for Central GST and ₹ 5,000/- for UT GST. Vide Challan Identification Number (CIN) -18022500004135 Date -23.02.2018. 2. The application for seeking Advance Ruling was forwarded vide letter dtd 20.03.2018 to the JAC for their rep
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same had to be considered as supply of goods falling under Chapter Sub-heading No.4901 attracting GST @5% as per Sr.No.201 of Schedule-1 of Noti.No.1/2017-CT (Rate) 28.6.2017 or as a supply of service falling under SAC No.9989 attracting GST @12% as per Sr.No.27 (1) of Noti.No.11/2017-CT (Rate) dated 28.6.2017, as amended (GST rate 18% up to 12.10.2017 and thereafter 12%) 3.1 They submitted that since 2005 they were clearing printed leaflets on outright sale basis and clearing the same under CSH No.4901 as exempted being not chargeable to duty. Accordingly w.e.f. 1.7.2017, the Applicant continued supplying the same under the category of goods falling under Chapter sub-heading No. 4901. However, w.e.f. 29.8.2017 the Applicant after intimating the Assistant Commissioner of CGST & CE vide their letter dated 29.8.2018 started supplying the same under the category of service falling under SAC No.9989. This was done on account of clarification issued by All India Federation of Master Pr
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as per which goods means every kind of moveable property other than money and security. Service was defined as per Section 2(102) of the CGST Act, 2017 as per which service means anything other than goods. The leaflet sold is nothing but one kind of moveable property and falls under the category of goods only. 3.3.2 They submitted that as per Para No.2 and 3 of CBEC Circular 11/11/2017-GST dated 20.10.2017 the printing contracts falls under the category of composite supply and the classification had to be decided on the basis of supply which constitutes the principal supply. Principal supply was defined at Section 2(90) as per which supply of goods or services which constitutes the pre-dominant element of composite supply and to which any other supply forming part of that composite supply was ancillary. In the given case mere supply of content by the customer was ancillary and the entire manufacturing cost of the products was comprising of own inputs used. Therefore, the principal supp
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by the publisher or a person who owns users right to the intangible inputs. The SAC No.998911 covers publishing on a fee or a contract basis and SAC No. 998912 covers printing and reproduction service of recorded media on a fee or a contract basis. There was no coverage of printed leaflet in SAC No.9989. Accordingly Sr.No.27 (1) of Noti.No.11/2017-CT (Rate) only covers publishing matter like news paper/books/generals/periodicals made on the basis of content supplied by publisher and Sr.No.27(2) inter-alia covers printing and re-production services of recorded media. 3.5 They submitted that accordingly printed leaflet manufactured with their own raw materials and as per content supplied by customer (other than publisher or person who owns the users right to the intangible input) does not fall under SAC No.9989 and merits classification under the category of goods only falling under CSH 4901. In other words, the above circular of CBEC supports applicant s case for classification under th
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= 2000 (12) TMI 404 – CEGAT, MUMBAI Books – Basic engineering technical documents and drawings consisting of about 300 pages of printed paper containing either written material or drawings bound in metal clip binding with covers on either side are books classifiable under Heading 49.01 of Customs Tariff Act, 1975 entitled to exemption under Notification No. 25/95-Cus. (para 4] 3 2001 (134) E.L.T. 156 (Tri. – Kolkata) = 2000 (11) TMI 681 – CEGAT, KOLKATA Advertising material – Folded leaflet titled 143 ways to export your sound -Classifiable under sub-heading 4911.10 of Customs Tariff Act, 1975 corresponding to ITC (HS) Exim Code No. 491110.02 which required a specific license for importation, [para 3] 4 2001 (136) E.L.T. 1420 (Tri. – Mumbai) = 2001 (7) TMI 615 – CEGAT, MUMBAI Trade Directory – Yellow pages – Tata press yellow pages containing list of paid advertisements, classifiable under Heading 49.11 of Customs Tariff Act, 1975 and not under Heading 49.01 ibid in view of Note 5 to C
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i. – All.) = 2017 (11) TMI 812 – CESTAT ALLAHABAD Carbon leaflets/Money receipts – Classification of – Product being a printed sheet running in length and used by specific customer for specified purpose classifiable under Chapter 49 of Central Excise Tariff as product of printing industry and not under Chapter 48 ibid, [paras 4, 5, 6] 7 2017 (349) E.L.T. 499 (Tri. – All.) = 2017 (8) TMI 991 – CESTAT ALLAHABAD Paper – Interleaved Carbon Papers/Money Receipts running in length meant for specific customer for specific purpose, classifiable under Chapter 49 of Central Excise Tariff as a product of printing industry, [paras 3,4, 5,6] 8 2018 (8) G.S.T.L. 444 (Tri. – All.) = 2018 (2) TMI 65 – CESTAT ALLAHABAD Interleaved Carbon Papers/Money Receipts running in length meant for specific customer for specific purpose – Chief Commissioner of Customs, Central Excise and Service Tax, Lucknow s communication No. (30)CCO/LKO/ Tech/12/2010/705 clarifying that Heading 4820 of Central Excise Tariff did
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Tariff as products of printing industry, [para 5] 10 Noti.No. 2005 (186) E.L.T. 532 (S.C.) = 2005 (8) TMI 657 – SUPREME COURT OF INDIA Books – Printed books – Designs, drawings and plans in the form of FEEP (Front End Engineering Package) imported under know-how and basic Engineering Agreement whether classifiable under Heading 49.01/49.06 of Customs Tariff Act, 1975 read with Notification Nos. 107/93-Cus. and 38/94-Cus. or classifiable under sub-heading 4911.99 ibid – CEGAT disposed off appeals merely on the basis of Larger Bench decision in case of Parasrampuria Synthetics Ltd. v. Commissioner [(Tribunal)] = 2000 (5) TMI 66 – CEGAT, COURT NO. III, NEW DELHI and not considered rival contentions on merits nor recorded findings thereon – Two Judges Bench of Supreme Court reversed decision of CEGAT in case of Parasrampuria Synthetics Ltd. – HELD : Expression book not being defined in Customs Tariff Act, natural and ordinary meaning of said expression to be kept in view – Some of tests a
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of Customs Tariff Act, 1975. [para 57] 11 2001 (133) E.L.T. 9 (S.C.) = 2001 (8) TMI 122 – SUPREME COURT OF INDIA Printed Matter – Printed drawings, designs and plans imported in 97 volumes under the Foreign Transfer of Technology Agreement for setting up a plant to manufacture Polyester, Polyester Filament Yarn and Polyester Staple Fibre -Contains documents in loose sheets merely put up in a folder – Not covered by the term printed book under SI. No. 10 of Notification No. 25/95-Cus. but are covered by SI. No. 15 as plans, drawings and designs – Appeals allowed -Headings 49.06 and 49.11 of Customs Tariff Act, 1975. – In terms of the agreement between the parties, these documents cannot but be attributed to be technical know-how in the shape of drawing, design, plan and other literature. It is a literature or specification for a particular plant to manufacture Polyester, Polyester Filament Yarn and Polyester Staple Fibre. Even without adverting to the general trade parlance of the word
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esenting by line, delineation without colour or with single colour -Corpus Juris Secundum defines it as a representation on a plane surface, by means of lines and shades – Notification No. 25/95-Cus. [para 7] Words and Phrases – Design in popular parlance is used as a synonym with plan or figure and includes a sketch – Design has within its ambit many facets including a criminal design which connotes on civil desire – Notification No. 25/95-Cus. [para 8] Words and Phrases – Book in common acceptance is a literary composition from which one may extend to advance his or her knowledge and learning – SI. No. 10 of Notification No. 25/95-Cus. [para 17] Words and Phrases – Word Manual means and implies a small book for handy use and includes a reference book, a hand-book as also a text book and does not cover a product of technology transfer between two countries – SI. No. 10 of Notification No. 25/95-Cus. [para 18] Interpretation of statute – Legislature intends to ascribe the ordinary comm
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volume was a collection of sheet paper containing printed matters. They were fairly securely fastened together at one end. They were protected by two covers also. It certainly looked like a book as well. Each volume if seen by a common man, he will treat it as a book, because each looks like a book. Even though the contents may not be of use to people at large as an ordinary book available in the market, it still continues to be a book. We hold that the understanding of the word book made by the High Court of Gujarat and Supreme Court must govern the issue before us. Accordingly, it is held that the materials imported by the appellants were books and books only. Clause 3 (a) of the Rules states that when goods are prima facie classifiable under two or more headings, the heading which provides the most specific description shall be preferred to headings providing a more general description. Heading 49.01 is a specific description printed books as against Heading 49.11 other printed matt
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h the issue under Customs Act not acceptable particularly when the word book has not been defined in the Customs Act. 1962 – [1999 (112) E.L.T. 353 S.C.] = 1999 (8) TMI 920 – SUPREME COURT OF INDIA relied. – A book, as understood by a common man, cannot change its character depending on the different statutes under which they are dealt with. This is more so when it is seen that the word book has not been defined under Customs Act, 1962. They submitted that as per the ratio of the above circulars/ judgments, the concept of principal supply for the purpose of Section 2(90) of the CGST Act, 2017 had to be decided and thereby the principal supply was supply of goods only and had no connection with supply of service. 3.7 They submitted that for printed matters, SAC 9988 or 9989 was relevant. SAC 9988 covers only when job work was attended on physical inputs (goods) owned by others. In this case there was no job work on inputs (goods) owned by the others and manufacturing of printed leaflet
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ro rated EPCG license whereby the applicant is supplying printed leaflets to SEZ units and EOU and fulfilling their export obligation by way of supply of goods under deemed export scheme. As per the EPCG license the applicant need to fulfill the export obligation by delivering the goods falling under 4901. SEZ and custom portal do not support service code dropped down for making GRN and lodging the Bill of Entry (BOE). Under no circumstances the impugned goods falls under the category of supply of service but the government was also needed to clarify as to how export obligation be fulfilled in the event of classification held under the category of services. 3.11. They finally requested that the applicants Advance Ruling application may be allowed by holding that the printed leaflets manufactured from own raw materials with contents supplied by customer and supplied on sale account to customers on principal to principal basis falls under the category of supply of goods falling under CSH
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CBEC Circular dtd 24.10.2017. He also made further written submission and provided the copies of various case laws in their defense. He finally requested that the product in question may be considered as supply of goods only & not as service. 5. Discussion and Findings In the present case we, the members of Advance Ruling, have to decide as to whether the goods/service (under question) has to be considered as supply of goods falling under Chapter Sub-heading No.4901 or as a supply of service falling under SAC No.9989. 5.1 To decide the issue, it is in the interest of justice to discuss the nature of product in question and its use. As per the evidence available before us, the applicant is engaged in the process of printing of the contents, supplied by the recipient of such printed goods (client), on the paper, purchased and owned by the applicant assessee, using the link also purchased and owned by the applicant. In simple language they are engaged in printing works for which the c
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ssification of the product which are as under- When the printing units are using content given by the customers, according to the department, they are prima facie engaged in producing customized printed materials and would be treated under Supply of service …. 5.3 We note from the said Pamplets/leaflets referred in the above para that the said pamplets have been printed to give the understanding of specific medicine. In normal parlance it is mandatory in the part of manufacturer of P.P.Medicaments to give the details of the product alog with actual product. This details is supplied in order to make aware the consumer about the contents, uses and side effects etc. of the product. Therefore, we find that primary nature of the product (leaflets) is to convey the message which is a form of Service and merits classification under SAC 9989. Our above findings can be seen from a sample leaflets printed below. 5.4 The applicant have relied upon circular No.11/11/2017-GST dtd. 20.10.2017
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ress or other contents supplied by the recipient of such supplies, would constitute supply of goods falling under Chapter 48 or 49 of the First Schedule to the Customs Tariff Act, 1975 (51of 1975) or supply of services falling under heading 9989 of the scheme of classification of services annexed to notification No. 11/2017-CT(R). 2. In the above context, it is clarified that supply of books, pamphlets, brochures, envelopes, annual reports, leaflets, cartons, boxes etc. printed with logo, design, name, address or other contents supplied by the recipient of such printed goods, are composite supplies and the question, whether such supplies constitute supply of goods or services would be determined on the basis of what constitutes the principal supply. 3. Principal supply has been defined in Section 2(90) of the Central Goods and Services Tax Act as supply of goods or services which constitutes the predominant element of a composite supply and to which any other supp
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lary to the principal supply of goods and therefore such supplies would constitute supply of goods falling under respective headings of under Chapter 48 or 49 of the Customs Tariff. 4. Difficulty if any, in the implementation of the circular should be brought to the notice of the Board. Hindi version would follow. Yours Faithfully, Rachna Technical Officer (TRU) Email: rachna.irs@gov.in 5.4.1 We note that the Para 4 of the said Circular specifically clarifies that in the case of printing of books, pamphlets, brochures, annual reports, and the like, where only content is supplied by the publisher or the person who owns the usage rights to the intangible inputs while the physical inputs including paper used for printing belong to the printer, supply of printing [of the content supplied by the recipient of supply] is the principal supply and therefore such supplies would constitute supply of service falling under heading 9
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ren Chemical Industries 2002 (139) E.L.T. 3 (S.C). = 2001 (12) TMI 3 – SUPREME COURT OF INDIA Relevant extract of the judgment is reproduced below: 9. We need to made it clear that, regardless of the interpretation that we have placed on the said phrase, if there are circulars which have been issued by the Central Board of Excise and Customs which place a different interpretation upon the said phrase, that interpretation will be binding upon the Revenue. 5.5.2 Further in the case of Madras Steel Re-Rollers Association 2012(278) ELT 584 (SC), = 2012 (8) TMI 788 – SUPREME COURT OF INDIA Hon ble Supreme Court has held as under: 7. Considering the facts and circumstances of the case and relying on the aforesaid decision of this Court, we hold that the Assessing Authorities as well as the Appellate and the Revisional Authorities are creatures of the Act and they perform the functions of the Quasi-judicial Authorities and the orders passed by them are also Q
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on Vs Binding nature of board circulars. the Circular No. 1006/13/2015-CX dated 21.09.2015 is issued in the context of decision of Apex Court in the case of Ratan Melting & Wire Industries, the decision although rules out that circulars contrary to the statutory provisions of law are not binding even on the departmental officers from the date of judgment but at the same time this decision also pronounces that even the revenue department has right to appeal against the clarifications issued by a board circular. This leads that the board circulars are binding on the revenue authorities till the provisions of the circular are not proved contrary to law by High Court or Supreme Court. 5.6 The applicant relied upon the Circular No. 1052/1/2017-CX, dtd 23.02.2017 to support their claim, However, on going through the contents of the said Circular it is noted that the referred Circular belong to pre GST era, hence, not applicable in the GST cases. Similarly, it is further noted
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