In Re : M\/s. Indo German Brakes (P) Ltd.
GST
2018 (6) TMI 369 – AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND – 2018 (14) G. S. T. L. 301 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND – AAR
Dated:- 14-3-2018
Ruling No. 02\/2017-18 In Application No. 03\/2017-18
GST
MR VIPIN CHANDRA (MEMBER) AND AMIT GUPTA (MEMBER)
\nFor The Applicant : Shri Vipil Dawar
\nRULING
\n1. This is an application under Sub-Section (1) of Section 97 of the CGST\/SGST Act, 2017 and the rules made thereunder filed by M\/s Indo German Brakes (P) Ltd) Khasra No. 323Mi, Central Hope Town, Selaqui, Dehradun seeking an advance ruling on classification and rate of applicable GST on “Disc Brake Pads & Brakes Shoes” being used in automobiles.
\n2. Advance Ruling under GST means a decision provided by the authority or the appellate authority to an applicant on matters or on questions specified in sub section (2) of section 97 or sub section (1) of section 100 in relation to the supply of goods or <\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n 5. Accordingly opportunity of personal hearing was granted to the applicant and department on 15.02.2018. Shri Vipul Dawar appeared for personal hearing on the appointed date and submitted that before GST regime, they were classifying the said product under chapter 6813 of the Central Excise Tariff but after GST regime advance ruling is requested to clarify whether the product in question is required to be classified under under chapter 68 or 87. No body appeared from the side of Revenue for the hearing. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n mounted, for brakes, for clutches or the like, with a basis of asbestos, of other mineral substances or of cellulose, whether or not combined with textile or other materials = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n al Fibre, Cellulose falls under the category of principle substances constituting most of the inputs. Whereas mineral substances namely Barium Sulphate and Graphite constitutes only a small percentage of the inputs used for making the aforesaid items. Therefore we observe that since mineral substances are not the principal or fundamental substance of Disc Brake Pads^and Shoes and, therefore, do not warrant classification under subheading 6813. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n goods in question are referred to in the market by those who deaf with them, be it for the purposes of selling, purchasing or otherwise. In the present case Disc Brake Pads and Shoes are nowhere referred to as the friction material and articles thereof and are known as parts of motor vehicle. Further, Disc Brake Pads and shoes also qualify the test to the effect that they are suitable for use solely or primarily with articles of Chapter Heading Nos. 8701 to 8705; accordingly they are classifiable under chapter heading 8708.' = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n be suitable for use solely or principally with products of Chapter 86 to 88; and (c) it must not more specifically be covered elsewhere in the Tariff; = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n different shape and its use no more remain t wide-ranging (as a friction material) but becomes further contoured (such as a brake pad in the instant case). Accordingly, it is observed that “Disk Brake Pads” and “Brake Shoes” which are in form of friction material already mounted on metal plate is not be covered under heading 6813 of the Tariff; = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n predetermined ratio to derive the desired friction material in powdered form. Their other main input is a metal sheet designed according to compatibility of the braking system of the vehicle upon which it is to be fitted to. The metal plate is 'shot blasted' to attain the desired surface\/strength. The friction material in powder form is poured into a mould\/die and along with the metal sheet it is fed into the moulding machine where the powder takes shape of a mould and gets fixed upon the metal plate. This product there after undergoes certain curing and finishing process to attain the desired marketable condition. The product [“disk brakes pads” and “brake shoes” for two\/four wheelers] is then packed in retail packs and in secondary packing in which it is cleared from the factory; = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" In Re : M\/s. Indo German Brakes (P) Ltd.GST2018 (6) TMI 369 – AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND – 2018 (14) G. S. T. L. 301 (A. A. R. – GST)AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND – AARDated:- 14-3-2018Ruling No. 02\/2017-18 In Application No. 03\/2017-18 GSTMR VIPIN CHANDRA (MEMBER) AND AMIT GUPTA (MEMBER) For The Applicant … Continue reading “In Re : M\/s. Indo German Brakes (P) Ltd.”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-12066","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/12066","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=12066"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/12066\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12066"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12066"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12066"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\n6. In the present application, applicant has requested for advance ruling on (I) classification of the product and (II) rate of applicable GST on “Disc Brake Pads 85'Brakes Shoes” being used in automobiles. Findings of the authority are as under :
\n7. “Classification of “Disc Brake Pads & Brakes Shoes” being used in automobiles” : Applicant in their application dated 5.12.2017 has submitted that in the chapter 6813 there is entry which specify that if friction material is not mounted,<\/p>\n
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\n8708: Parts and accessories of the motor vehicles of headings 8701 to 8705
\n7.2 Having gone through the aforesaid chapter heads we now proceed to determine the issue in hand.
\n7.3 Sub-heading 6813 provides for:
\n “Friction material and articles thereof (for example, sheets, rolls, strips, segments, discs, washers, pads), not mounted, for brakes, for clutches or the like, with a basis of asbestos, of other mineral substances or of cellulose, whether or hot combined with textile or other materials… Other….”
\nWord “Basis” as mentioned above is not defined in the GST Tariff. In the absence of any guidance in the Explanatory Notes, it is proper to use the principal that tariff terms are construed in accordance with their common and commercial meaning. “Basis” has been defined as follows:
\n (a) The main constitue<\/p>\n
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\n7.5 Further Chapter Heading 8708 covers parts and accessories of motor vehicles of headings 8701 to 8705, provided the parts and accessories fulfil the following conditions:
\n (i) They must be identifiable as being suitable for use solely or principally with the above-mentioned vehicles;
\n (ii) They must not be excluded by the provisions of Notes to Chapter 87
\n (iii) They must not be more specifically included elsewhere in the nomenclature…
\n7.6 The Disc Brake Pads and Shoes are not excluded by aforesaid Chapter Notes, and are dedicated and u<\/p>\n
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\n7.9 Irrespective of aforesaid we also find that products being manufactured by the applicant are meant to be used in' the braking system of vehicles of heading 8701 to 8705 of the Tariff. The parts and accessories of such vehicles are covered in heading 8708 of the Tariff;
\n (a) The said Chapter 87 falls under Section XVII of the Tariff Section Note 2 to Section XVII (covering Chapter 86 to 89) specifically excludes certain articles from the purview of the expres<\/p>\n
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\n (e) As regards to the product in question- “Disk Brake Pads” and “Brake Shoes” for automobiles, it is observed that there seems no dispute as regards to the fact that they are not excluded vide said Section Note 2 of Section XVII and that they are meant solely or principally for use in the braking system of automobiles. The only point of discussion, then, remains as to whether they could be taken out from the purview of Section XVII for the reason that they are more specifically classified elsewhere in the Tariff;
\n (f) The contesting heading, as stated by the applicant, is 6813 of the Tariff. Chapter 68 falls within Section XIII of the Tariff and this Section does not have any Section Notes. Heading 6813 reads “Friction material and articles thereof (For example, sheets, rolls, strips, segments, discs, washers, pads), not mounted, for<\/p>\n
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\n (h) Explanatory Notes to the Harmonized System of Nomenclature, pertaining to heading 6813 of the Tariff too have been perused and give a similar interpretation. The relevant portion reads as follows:-
\n ” … Owing to its high friction coefficient and its resistance to heat and wear, this material is used for lining brake shoes, clutch disc, etc., for vehicles of all kinds, cranes, dredges or other machinery…
\n According to the particular use for which it is intended, friction material of this heading may be in the form of sheets, rolls, strips, segments, discs, rings, washers, pads or cut to any other shape…
\n …..
\n The h<\/p>\n
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\n (j) In view of the foregoing report, authority observes that the “disk brakes pads” and “brake shoes” are meant for sale in the secondary market i.e. replacement market of various models of vehicles. The <\/p>\n
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