12% GST applicable to Kraft Paper, Honeycomb Board or Paper Honeycomb Board: AAR [Read Order]

AAR - Kraft paper - honeycomb board - Taxscan

The Authority of Advance Ruling (AAR), Karnataka ruled that Kraft paper, honeycomb board, or paper honeycomb board is classified under the heading 48089000.

The applicant, M/s LSquare Eco Products Private Limited is a manufacturer of Kraft paper honeycomb boards or paper honeycomb boards using the kraft paper, paper honeycomb core, and adhesives. The boards are made up of 2 layers of kraft liner and one layer of a honeycomb-like structure made of fluting kraft paper.

The applicant submitted that this paper honeycomb board by structure is very similar to corrugated paper boards listed under 46081000 with fusing direction point perpendicular to corrugated boards. The top and bottom face of this boards may be or may not be printed to carry out the product data like in the case of carton boxes Further, these paper honeycomb boards used in the primary packaging of goods as a cushioning material separator or de protector to make shipping cartons of goods and pallets and pallet boxes.

The applicant sought advance ruling on the issue of whether the HSN Code applicable for craft paper made honeycomb boards be 48089000 or 48081000.

The Authority consisting of members M.P. Ravi Prasad and Mashud Ur Rehman Faruqui ruled that  Kraft paper, honeycomb board, or paper honeycomb board is classified under the heading 48089000.

“On verification of the structure and purpose for which kraft paper honeycomb board or paper honeycomb board used are similar to the corrugated paper board (listed under 48081000 only difference is that this paper honeycomb board consists of honeycomb-like structure core material at the center and on either side of this one or more layer of kraft paper is glued by using adhesive with fluting direction being perpendicular to corrugated boards. Hence this honeycomb paper board classified under the heading 48089000 as other instead 48081000,” the authority observed.

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