|
Regarding classification of certain inorganic chemicals such as,
monopotassium phosphate, calcium nitrate, potassium magnesium phosphate as
fertiliser
Circular No. 44
dated 6th August 2001
I am directed to invite your attention to the subject mentioned above.
It has been brought to the notice of the Board that chemical compounds like
monopotassium phosphate, calcium nitrate and potassium magnesium phosphate are
being classified as fertilizers under Chapter 31 of the Customs Tariff and
levied to duty at a concessional rate as applicable to a fertilizers.
2. The
matter has been examined. Chapter 31 of the Customs Tariff covers fertilizers.
Note 1(b) of Chapter 31 states that this Chapter does not cover separate
chemically defined compounds other than those answering to the descriptions in
Note 2(A), 3(A), 4(A) and 5 of the said Chapter. As in monopotassium phosphate,
calcium nitrate and potassium magnesium phosphate do not figure in the above
Chapter notes, they have to be excluded from Chapter 31 and are to be classified
as a separate chemically defined compounds, Further, Chapter note 5 to Chapter
31 states that for the purposes of heading 31.05, the term �other
fertilisers� applies only to products of a kind used as fertilizers and
containing, as an essential constituent, at least one of the fertilizing
elements, namely, nitrogen, phosphorus or potassium.
3. Keeping
in view the provisions explained above and the HS Explanatory Notes to concerned
headings, the chemical compounds, viz., calcium nitrate, monopotassium phosphate
and potassium magnesium phosphate will merit classification under Chapter 28 of
the Customs Tariff, and not under Chapter 31 as fertilisers. Such compounds
will, therefore, not be eligible for benefit of concessional duty prescribed for
fertilisers under the relevant exemption notification. It may be noted that
calcium nitrate specifically figures in the Explanatory Notes to heading 28.34
and potassium phosphate finds a mention in heading 28.35 itself.
4. The
Custom Houses may kindly take not of the above clarification while classifying
the aforementioned chemical compounds. If such goods have been assessed as
fertilizer in the past, appropriate demands will have to be issued immediately
and differential duty realized. Difficulties, if any faced, in the
implementation of above clarification may be brought to the notice of the Board.
Please acknowledge receipt of this circular.
|