KERALA AUTHORITY FOR ADVANCE RULING

GOODS AND SERVICES TAX DEPARTMENT

Tax Tower, Thiruvananthapuram

M/s. Gurudev Metal Industries is engaged in manufacturing of fishing boat, fishing vessels, parts and accessories. They have requested for an advance ruling on the following items customized for fishing vessels and fishing boat.

Propeller, Shaft/SS Rad, Gun Metal Bush /Bearing, Stuffing Box, Brass Tube/SS tube, Rudder shaft and blade, Sea cork/ Water strainer, GM Gate Valve, MS Pipe, Propeller Nut /GM Nut, Coupling, SS Rods & Square, SS Flat, GM Gland and Ring and MS Plate used in fishing or floating vessels.

The authorized representative of the firm was heard. It is pointed out that the following items are purchased and exclusively used for the manufacturing of fishing boats, vessels and parts.

Propellers are used in fishing boats, fishing vessels, house boat and persin boat. The raw materials used for the manufacture are gun metal scrap, brass scrap, manganese bronze scrap, aluminium scrap, incords metal etc. These materials undergo casting in order to make propeller. Propellers -shaft are purchased as SS rod, SS shaft etc. After bending and straightening, through cutting, taper cutting and threading, it can be used as propeller shaft. Propellers are attached to this shaft.

Gun metal bush / bearing is made by casting scrap. It is used to maintain the steadiness of the shaft. The bush is attached to the stuffing box. Stuffing box is made by casting scrap.

Propeller shaft goes within the stuffing box. Brass tube l SS tube comes in between two stuffing boxes. These are used in boats that have a wooden body. After bend checking, machining, threading etc., stuffing box is attached to either sides of the tube and thus forms a Stem Gear Assembly set.

Rudder shaft and blade is fabricated from SS rod and MS plate. Sea cork / water strainer is made by casting scrap. This is the part that filters water into the boat's engine. This process is used to cool down the engine. GM Gate valve is attached to the sea cork. MS Pipe / seamless pipe are used in steel body boats. After bend checking, placing MS flange, welding and machining, stuffing box is attached to both sides to form a stern gear assembly set. This is used for steel body boats.

Propeller nut / GM nut is made by casting scrap. This is used to lock the propeller with the shaft. MS plate, MS bright bar and MS rod are generally used to make coupling and used to attach shaft with the engine, SS rod square is used to make key for shaft and SS rod for making nut and stud of stuffing box. Rudders of wooden body boats will be made of wood itself. Fabricated SS flat gives strength to them. Gland, which is a part of stuffing box, prevents water from getting into the boat while the propeller shaft is working. This product is made by casting scrap. Flange for making coupling and for placing in seamless pipe are made from MS plate.

The matter was examined in detail. As per order No.CT/5496/18-C3 Dt.29-05-2018 a ruling has been already been issued to the effect that commodities such as Marine Propellers, rudder set, stem tube set, propeller shaft and MS shaft for couplings used as a part of fishing floating vessels would come under Entry 252 of First schedule and taxable @ 5% GST.

As per Notification No.1/2017 Central Tax (Rate) dtd. 28-06-2017 vide Sl. No.247 of First Schedule, HSN 8902 fishing vessels, factory ships and other vessels for processing or preserving fishery products and as per Sl.No.252 part of goods of heading 8901, 8902, 8904, 8905, 8906 and 8907 falling under any chapter are taxable at the rate of 5% GST. Moreover as per order AAR No.KER /2018 dt.20-10-2018 ruling has been issued to the effect that all parts of fishing / floating vessels coming under the HSN Code 8902 are taxable @ 5% under Serial No.252 of first Schedule.

In view of the observations stated above, the following rulings are issued;

Classification of goods as 'part of fishing vessels' - Propeller, Shaft/SS Rod, Gun Metal Bush/Bearing, Stuffing Box, Brass Tube/SS Tube, Rudder Shaft and Blade, Sea Cork/water Strainer, GM Gate Valve, MS Pipe, Propeller Nut/GM Nut, Coupling, SS Rods & Square, SS Flat, GM Gland and Ring and MS Plate.

Propeller, Shaft/SS road, Gun metal bush/bearing, Stuffing box, Brass Tube/SS Tube, Rudder Shaft and Blade, Sea Cork/Water Strainer, GM Gate Valve, MS Pipe, Propeller Nut/GM Nut, Coupling, SS Rods & Square, SS Flat, GM Gland and Ring and MS Plate used as parts of fishing / floating vessels come under the HSN Code 8902 and are taxable @ 5% (2.5% CGST + 2.5% SGST) under Serial No.252 of First Schedule of the Notification No.01/2017 Central Tax (Rate) dtd.28-06-2017 (SRO.No.360/2017 dt.30-06-2017).