Monday, September 21, 2020

Interaction- M A Waheed, Director Technical, Perma Construction Aids

Bring about clarity and uniformity in Classification




Your assessment of the new GST regime? Do you think it will benefit companies with GST issues of ambiguity in interpretation of construction chemicals?

GST is expected to simplify the taxation process and bring about uniformity and better compliance. Not only construction chemicals manufacturers but entire manufacturing sector is expected to benefit from it. But we are facing a unique problem. Each manufacturer has over 100 different products, used in pre construction or post construction stage to ensure performance requirements of a structure. To find classification of these products under HSN is a huge task, or rather it is not clearly there. As these products do not find a coherent classification, manufacturers guided by the Consultants (non-technical) go in for classifying these products roughly based on either raw material consumed or on type of vague end-uses, wherever they find a close enough resemblance or a description in the HSN. Till now classification did not matter much due to single excise duty. Now that there are various GST tariff slabs between 12, 18, and 28 per cent, the industry is shaken about where and how products have to be classified. If one chooses classifying under higher duty bracket to avoid risk of show cause notices and subsequent harassment at a later date, he becomes expensive and non-competent in the market. If one goes for classification of lower GST then he is always under threat of getting Show Cause notices and pressurized by officials. Since we are a knowledge based industry which needs to go on developing new products with growing demands by construction industry to keep it going, it should not be burdened with the task of finding new classification each time and thereafter go under harassment if it is not found appropriate by any non-technical officer. It is desired by the industry to generate a single classification and assign a single GST tariff, so industry can function well. 



What are the chances of the GST Council accepting CCMA demands?

CCMA is not having any special demand for any concession from the GST council. It is only looking at bringing about clarity and uniformity in classification when HSN is not covering its products entirely and satisfactorily. Whatever tariff decided by the GST Council, we will abide by it avoiding all future complications and putting to rest all misinterpretations. Since this is in best interest of country and Government, industry hopes that the GST council will take a positive step of assigning a single classification and a single tariff.

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