M/S JJ FABRICS ERNAKULAM

The Applicant, a manufacturer of carry bags made of poly propylene non- woven fabrics used by industrial units, big retail outlets and textile shops for packing their commodities.

The Applicant has sought Advance Ruling for determination of rate of tax on such carry bags.

Applicant submitted that as per the clarification issued by the Commissioner of CGST and Central Excise, Madurai the said non-woven bags comes under HSN 6305 90 00 with 2.5% CGST and 2.5% SGST if sale value does not exceed Rs. 1,000/- per piece. Further, as per clarification order C3/17556/09 dated 29.09.2009, wherein it was clarified that packing bags, textile bags, and carry bags made out of non-woven fabrics of polypropylene is covered by the HSN code 6305 33 00 of the Customs Tariff Act.

In Custom Tariff, sacks and bags made of polypropylene strip or the like is classified under Chapter 63 of the Act i.e. 6305 33 00.

The above HSN appears both in Schedule I and Schedule II of Notification .No. 01/2017 Central Tax (Rate) based on the sale value of the product as follows:

SCHEDULE I
224                  63 [other than 6309]     other made up textile articles, sets, of sale value not exceeding Rs. 1000/ - per piece

SCHEDULE II
171                 63 [Other than 6309]         Other made up textile articles, sets of sale value exceeding Rs. 1,000/- per piece [other than Worn clothing and other worn articles; rags]

Crux -  The sale value of non-woven carry bags made of polypropylene is less than Rs. 1,000/- per piece, it will attract tax @ 5% vide entry No. 224 of schedule I of both CGST and SGST notification.