Dismissed

M/s Manishaben Vipulbhai Sorathiya

GST AAAR28 Feb 2025GUJ/GAAAR/APPEAL/2025/10

Case brief

AI extract

What is this about?

The Gujarat Authority for Advance Ruling rejected the appellant's appeal challenging the classification of PVC floor mats for four-wheel motor vehicles. The court dismissed a fresh plea for classification under HSN 5705 as not maintainable and upheld the lower ruling that the goods fall under CTH 8708 liable to 28% GST.

What did the court decide?

The appeal filed by the appellant against the Advance Ruling No. GUJ/GAAR/R/2023/10 dated 9.3.2023 was rejected, and the impugned ruling was upheld.

M/s Manishaben Vipulbhai Sorathiya — GST and Indirect Tax | GST AAAR (2025)

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GUJARAT APPELLATB AUTHORITY FOR ADVANCE RULING GOODS AND SERVICES TAX D/5, ItA.rYA KAIr IIHAVAN, ASIIRAM ROAD, ATIMEI)AI}AD^_ 380 OO9.

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ADVANCE RULTNG (APPEAL) NO. GUJ/GAAAR/APPEAL12}2S ll0 (IN APPLICATION NO. Advance Ruling/SGST&CGST 12023 I AR/06)

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Date:Z{.2.2025

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Nameandaddressofthe appellant	ManishabenVipulbhaiSorathiya, [Trade^{name: Autotech]} A-1418,Groundfloor, RoadMpl7,Udhyognagar, ljdhna,Surat-394210.
GSTIN ofthe appellant	24T+1ZPS84I8DIZL
JurisdictionOfficc	CenterCommissioncratc-Surat Division-II-Surat Range-[
Advance Date ItulingNo.and	GUJ/GAAR/R/2023Il0dated9.9.2023
Dateofappcal	17.04.2023
DateofPersonalHearing	21.r.2025
Presentforthe appellant	ShriChintanKotadiya,CAandShriDharmesh Kotadiya

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At the outset we would like to make it cle ar that the provisions of the Central Goods and Services^'fax Act, 2017 and Gujarat Goods and Services Tax Act, 2017 (hereinafter refcmed to as the 'CGST Act, 2Ol7' and the 'GGST Act, 2017 ') are pari materia and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a referencc to the CGST Act ,2017 would also mean reference to the corresponding similar provisions in the GGST Act, 2017.

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'l'he prescnt appcal is filed undcr scction 100 otthc CGS'I'Act,2017 and the GGST' Act, 2017 by M/s. Manishaben Vipulbhai Sorathiya (fo, shorr 'Appell ant' ) against the Advance Ruling No. G[]J/GAAR/R/2023110 dated 9.3.2023.

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Briefly, the facts are that the appellant is engaged in the manufacture & supply of floor mats for four wheel motor vehicles [cars], which are essentially made of PVC [poly vinyl chloride] material.

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4 As per the appellant, the PVC floor mat is made of thc following four raw materials viz:

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[i]^{PVC lcather commonly knownas artificial leather}

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It gives thc impression of lcather;

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It is derivcd by laminating PVC and fabric;

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It is chcaper than leather;

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It is classified under HSN 59031090 and leviable to GST @^12%

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[iiU'U^{Foamalso knownas polyurethane foam} o It is classificd undcr IISN 39211390 and leviable to GS'f @^18%

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Iiii]Xl,l'}E^{foam knownas cross linked polyethylene foam} o It's a cross linked closcd cell foam with^{compact feel;}

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Its rcsistant to water;

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It is classificd under I'ISN 39211390^{and leviablc to GS'I} @^l8%.

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[iv]l'VC^{mat, commercially knownas Ileel pad} o The heel pad is nothing but additional^{footsupport for the driver of the vehicle;} o It is classified under^{FISN 39211390 and leviable to GST} @^l8%.

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The manufacturing process of^{the said floor mat is stated to be as}

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follows:

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a PVC leather and PU foam are^{laminatedwitheach other;}

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a this laminated material undergoes^{embroidery & is further bonded with XLPE foam;} a thcrcaflcr cotton thrcad^{and adhesiveis used to put all the abovematerials together to} makc a complctc lloor^mat;

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a the floor mat is then^{cut as per the customizedvehiclcfloorpattern addingstitches&} piping wherever required;

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a after the process, Velcro^{is attachedat the bottom/base surface at the appropriate} places to form a firm grip;

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a finally IIeel pad made up^{of PVC is affixedlattached on thc cxposed surface lupper} surface] of one floor^{mat whichis for the vehicle driver's side.}

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6 The appellant before^{the GAAR therefore, contended that the floor mat} for four wheel motor^vehicles [cars]^{would merit classification under CTFI 3918,as}

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the product in^{question is a floor coveringof plastic.}

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7 . In view of the foregoing^{facts, the appellant sought Advance Ruling on}

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the following^{qucstions, viz:}

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What is the appropriate^{classificotion & rate of GST' applicable on supply of PVC floormats} [CarsJ^{under CGST andGGST?}

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Consequent to hearing the applicant, the GAART, recorded the following

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findings viz:

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a appellant's product is an admixture of PVC leather, PIJ Foam [polyurethane foam], XLPE [oam; that cotton thread and adhesivc is used to bind the materials and then Heel pad is affixed on the PVC mat;

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CTII 390410 covers items by tl-re description of PVC, not rnixcd rvith any other substances & this not being thc casc in thc disputed goods the PVCI mat would not fall undcr 390410;

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a tlrat for the goods to merit classification under 3901 to 39 74, it has to be in primary form; tlrat the PVC floor mat for motor vehicles would not fall within the arnbit of C'fH 3904;

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a that only the goods made up of textile articles, would get covered under section XI fTextilcs^{& ]'cxtilcsarliclcsl;that goingby the constitucnts/ingrcdicnts prescnt it would} gct cxcludcd l'rom section XI, by virluc of scction rrotc l(h) & thus r,vor,rlcl rrot flall undcr 5103;

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that PVC floor mats will not fall under 3918 but under 8708 because:

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the HSN note 8708 covers parts and accessories of the motor vehicles falling under 8701 to 8705 subject to two conditions first being that the goods in question must bc identifiable as bcing suitablc I'or use solcly or principally with thc vehiclcs mcntioned I'rom 87.0l to 87.05 which stands satisficd as the floor mats made of PVC, is suitable fior usc principally with thc motor vchiclcs for which it is being rnanufactured, it being a tailor made product;

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J'he second condition is that these goods must not be excluded by the provisions of the note 2 of Section XVII; that PVC floor mats for four wheel motor vchiclcs docs not fall in thc exclusion;

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undcr scotion notc 3 of IISN, parls and acccssorics which arc not suitablc for use solcly or principally with the articlcs of Chaptcrs 86 to 88 arc excluded; that in the present case, the floor mats used for four wheel motor vehicles [cars] supplied by thc applicant, is principally for use in motor vehicles;

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the parts and accessories of chaptcr 87 include floor mats; that it is not the applicant's casc that his product l'alls within this cxccption mcntioncd in the I ISN.

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that appcllants rcliar-rcc on the casc of Uni Products India l,td. 1,2020 ( I l6) taxrnann.corl 401(SC)] is not tenable owing to the aforementioned facts and also nowhere it is claimed that the production process in respect of their product was similar to the once mentioned in the said judgement.

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9 I'hc GAAI{, thereafter, vide the impugned ruling dated 30.5 .2024,

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held as follows:

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that the impugned goods i.e. PVC Jloor mats for use in cars supplied by the applicant is classifiable under CTII 8708 & applicable rate of GST' would be 28% fi 4% each oj tCSf ona sGSrl.

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Aggrieved, the appellant is before us, raising the following

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contentions, viz

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that thcir product falls undcr Sr. No. 146 of notification No. ll20l7-C'I'(ltatc) & is classifiable undcr C I'I I 5705;

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that the word 'such as' uscd in Sr. no. 146 ofthe notification ibid, is to illustrate the inclusion & not exclusion; that it only excludes goods mentioned in serial no.219 of Schcdulc I of the notification;

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that thc hcading 5705 covers othcr carpcts & other tcxtilc floor covcrings, which stands dcfined in notc 1 to chapter 57

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that all floor covcrings in which textile materials scrvc as thc cxposcd surfacc of the article when in use as carpets & other textile floor coverings; that the PVC leather

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1 Gujarat Authority for Advancc Ruling

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HoRtri I (Ui.a' o-q a)'(ft x c. .t-.{ JI A\i,\r-

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commonly known as artificial leather falling under 59031090 is the major input in the manufacture of floor mats;

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that since AAR has stated that the goods do not fall under 39, the exclusion of clause 1(h) would not apply;

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that thc floor mats are made of textile materials and not mercly plastic & hence cxclusion of 1(h) cannot apply;

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that if for any reason thc floor mats are classifiable undcr 5705 & 8708, then in terms of 3(a) of GRI, 5705 is applicable since it is the most specific description;

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that floor mats in question have been excluded from 8708 via explanatory notes.

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1 1. Personal hcaring in the matter was held on 21.01.2025 wherein Shri Chintan Kotadiya, CA and Shri Dharmesh Kotadiya appeared and reiterated the submissions made in the appeal. The submitted additional submissions during the coursc of personal hcaring, rciterating thc grounds already mcntioncd. fhcy also rclied upon the case of M/s. uni Products India Ltdz.

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FINDINGS :.

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We have carefully gone through and considercd the^{appealpapers,} written submissions filed by the appellant, submissions^{made at the time of} personal hearing, the impugned Advance Ruling and other materials^availableon record.

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We note that the applicant in his^{submissionbefore the GAAR had} stated that thc product is classifiable^{under 3918 or 3904 and had further relied} upon the^judgement in the case of^\zls. tlni^{Products India Ltd, ibid. This led the} GAAR to record the following findings^{in para 20 of the impugnedruling viz}

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We Jind that the applicant in^{para (5), page 7, oJ' his submission has} primarily contendecl that his PVC /loor^mats for^{motorvehicles mandacturedand} supplied by them is classifiable^{underCTH 3918. The applicanthas} further^{relied upon} the^judgement of Uni Products^{India Ltd.} [2020^{(l 16) taxmann.com401(SC)] in his} submission. Thus, we now^{need to examinewhetherthe productwould} fall^{under CTH} 3918, 5703 or 8708,

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However, before us, the^{appellanthas madethe followingprayersviz}

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PRAYER

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ln^{viewof the foregoingparas' we humblypray before your Honor to:} since^{it is} i. Set^{aside the impugned ad.lancl-rulingdated} provisions^{92''!3:'O'3 of law'} contrary^{to tt} "-il"t-" as well ." "pii""'tre ii. Classify^{the floor mats in questionunder heading 5705'}

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iii. Pass^{such other order as deemed fit in the interestof justice'}

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2 2o2o (372) lil- 46s (SC)

I)age 4 of 6

The appellant now feels that the product viz PVC floor mats for use in^cars would merit classification under HSN 5705, a claim never raised before GAAR.^The appellant himself seems unsure as far as the classification of the impugned^goods are concerned. Ilc that as it ffivy, this plea of classifying the product under^I-ISN having been made for the first time before an appellate authority cannot be entertained in terms of the^judgement of the Hon'ble Supreme Court in the case of M/s. I.T.C. Ltd3

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Doubtless the principle of res^judicata is a fundamental doctrine of law that there must be an end to litigation. (See Daryao v. The State of U.P., []962J I SCR 571 but the plea of res judicata has to be specifically and expressly raised.^(See . Medapati Surayya^v. Tondapu llala Gangadhara Ramalcrishna lleddi, AIR 35 (1948) PC 3, 7.T'his view has been recently reiterated in V. Rajeshwari v. T.C. Saravanabava, (2003) 10 Scale^768, where it is said that the foundation of the plea of res^judicata must be laid in the pleadings" If this was not done, no party would be permitted to raise it for the first time at the stage of the appeal. T'he only exception to this requirement is when the issue of res judicata is in.fact arguecl before the lower Court. In this case not onll; had the plea not been taken by the Revenue at any stage before any o/ the authorities, but arguments exactly to the contrary had been put forward by the respondent. We will not permil the plea to be raised now. In the circumstances, it is not necessary to consider the other arguments urged on the appellant to counter the respondent's submission on the applicability of the principles of res judicata.

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I{aving said so, it would not be appropriate to entertain the averments made by the appellant seeking classification of the impugned goods under HSN 570s.

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The other averments raised by the appellant is that that since GAAR has stated that the goods do not fall under 39, the exclusion of clause 1(h) would not apply.^'fhe finding given in para 25, bascd on which thc aforcmcntioncd avcrmcnt is made appears to be misconceived. The finding when read holistic ally, appears to have been given only to point out that the averment of the appellant wherein on one hand he was seeking a classification under chapter 39 and on the other hand was relying on a judgement of the Hon'ble Supreme Court in the case of [Jni Products India Ltd, ibid, which classified car mats under chapter 570390.90. Even otherwise, this ground was never raised before the GAAR.

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3 2004 (171) Er- 433 SC

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'I he next averment of the appellant that floor mats in question have been excluded from 8708 via explanatory notes already stands answered by GAAR as under:

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the parts and accessories of chapter 87 include floor mats (other than of textile material or unhardened vulcanized rubber), etc.. It is not the applicant's case that his product falls within this exception mentioned in the 11,S//.

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Further, the reliance on the^judgement of the Hon'ble Supreme Court in the case of Uni Products Ltd, ibid also stands addressed in para2Tof the impugncd ordcr.

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17 . What is not controverted by the appellant is the detailed reasoning given in para 25 of the impugned order, classifying the product under chapter 8708.

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We find that the GAAR vide its impugned ruling correctly held that the PVC floor mats for use in cars supplied by the applicant is classifiable^under CTH 8708 & would be lcviablc to GST @ 28%.

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In view of the above, we reject the appeal filed by appellant^M/s. Manishaben Vipulbhai Sorathiya, fTrade name : Autotechl^{againstthe Advance} Ruling No. GIIJ/GAAIVIVZ}Z31I} dated 9.3.2023,^passed by the^Gujarat Authority for Advance Ruling.

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( Rajeev opno ) Member (SGST)

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(B V Siva Naga Kumari) Member (CGST)

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Page 6 of6

M/s Manishaben Vipulbhai Sorathiya

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M/s Manishaben Vipulbhai Sorathiya

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