RATE OF TAX ON ITEM ‘CELLULAR/ CELUKA  PVC FOAM BOARDS’ MADE FROM PVC AND CALCIUM AS MAJOR INGREDIENTS ALONG WITH OTHER CHEMICALS UNDER DVAT ACT, 2004

Date: 23-05-2013

Assessee Submission: The product manufactured is cellular sheet made of PVC compound; it finds its place under entry no. 84(205) of Schedule III of the DVAT Act, 2004. Further,  the composition of product manufactured also falls under Chapter 39 of the Tariff and H.S.N code is 3921 12 00 (other plates, sheets, film, foils and other strips of Plastic- cellular of Vinyl Chloride).

 

Departmental Representative (DR): stated that entry no. 41A & 84 of the III schedule of the said Act cannot be read in isolation as these entries are governed by the notes as mentioned against the relevant entry under the Central  Excise Tariff Act, 1985 and notes appended to these two entries of the DVAT Act, 2004. The relevant notes of DVAT Act in respect of entry no. 41A & 84 of the Schedule III of the said Act which are common for both these entries have been reproduced as under:-

                         Note:-(1) The Rules for the interpretation of the provisions of the Central Excise Tariff Act, 1985 read with the Explanatory Notes as updated from time to time published by the Customs Co-operation Council, Brussels apply for the interpretation of this entry and the entry number 84 of this Schedule.

                       Note:- (2) Where any commodities are described against any heading or, as the case may be, sub-heading, and the description in this entry and in entry number 84 is different in any manner from the corresponding description in the Central Excise Tariff Act, 1985, then, only those commodities described in this entry and in the entry number 84 will be covered by the scope of this notification and other commodities though covered by the corresponding description in the Central Excise Tariff will not be covered by the scope of this notification.

                     Note:-(3) Subject to Note (2), for the purpose of any entry contained in this notification, wherein the description against any heading or, as the case may be, sub heading, matches fully with the corresponding description in the Central Excise Tariff, then all the commodities covered for the purposes of the said Tariff under that heading or sub-heading will be covered by the scope of this notification.

                   Note:-(4) where the description against any heading or sub-heading is shown as "other” then, the interpretation as provided in Note 2 shall apply. 

For the purposes of examining as to whether the item under determination is covered by both the Acts i.e. DVAT Act, 2004 and Central Excise Tariff Act, 1985, it must satisfy the condition of matching the entry in both these Act as given at note (3) or covered only under DVAT Act, 2004 as it falls in the above note (2) & (4). The relevant part of entry no. 84 and its sub-entry 205 of schedule III appended to the DVAT Act, 2004 have been reproduced for examining the product on the above mentioned conditions laid down in DVAT Act, 2004: -

Entry no. 84- Industrial Inputs….

Serial NO.	Description	Central Excise Tariff  Heading
205	Micro Cellular Sheets, Banwar Sheets & Hawai Straps.	None

                                                 

The HSN Code of the item under Central Excise Tariff Act, 1985 referred by the applicant reads as under:

Chapter: 39	Plastics and articles thereof
Heading: 3921	Other plates, sheets, film, foil and strip, of plastics
Sub-heading : 3921 12 00	Of polymers of vinyl chloride

The DR stated that on comparing the above two entries it is seen that the entry no. 84 (205) of Schedule III appended to the DVAT Act, 2004 differs from HSN code 3921 12 00 of the Central Excise Tariff Act, 1985, so rule as detailed out in note (2) given at the end of entry no. 84 of Schedule III of the DVAT Act, 2004 shall prevail and the HSN entry and its sub-heading will not play any part in deciding the product. He further stated that the item i.e. ‘Cellular/ Celuka  PVC Foam Boards’ is not covered in entry no. 84 (205) of Schedule III appended to the DVAT Act, 2004 and therefore, it is an unspecified item.

IN DR’s opinion the item ‘Cellular/Celuka  PVC Foam Boards’ is not covered by entry no. 84 of Schedule III or any other entry of the Schedules of DVAT Act, 2004 and is general unspecified item falling under section 4 (1) (e) of DVAT Act, 2004 and shall attract tax @12.5%. Held accordingly.

Regards

CA. Mona Singhal

Partner

Arpit Gupta & Associates

Chartered Accountants

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