Case Law Details
In re Ce-Chem Pharmaceuticals Private Limited (GST AAAR Karnataka)
Hand sanitizers do not serve as a replacement for through handwashing with soap and water
The Appellant has expressed his objection to the lower Authority’s finding that hand sanitizer is an alternative to soap. We clarify that hand sanitizers do not serve as a replacement for through handwashing with soap and water. Instead, the alcohol-based hand sanitizers are thought to bring the consumers some of the benefits of handwashing when washing hands with soap and water is not practical in certain settings. In fact, alcohol-based hand sanitizers are usually preferred to handwashing with soap in occupational health care setting and in community settings. They are faster, more efficient and easier on the skin than repeated handwashing with soap and water. However, hand sanitizers are not suitable for all settings. They are not recommended for use on hands that are soiled with visible amounts of dirt or grease and are also found to be ineffective at removing some kinds of pathogens. In such instances, handwashing with soap and water is the recommended method to clean hands. Therefore, we disagree with the lower Authority’s observation that hand sanitizer is an alternative to soap. Both ‘hand sanitizer’ and ‘soap and water’ are recommended methods in hand hygiene practices and each method is effective in certain situations.
DGFT Notification is not authority for determining classification of goods under GST
The Appellant has also attempted to advance his case by claiming support from the DGFT Notification dated 6-5-2020 which prohibits the export of Alcohol-based hand sanitizers falling under ITC HS Codes 3004, 3401, 3402 and 3808.94. It is their claim that Chapter Headings 34.01 and 34.02 pertains to soaps and other organic surface-active products used for washing the skin and Chapter Heading 3808.94 covers insecticides and disinfectants generally used on inanimate surfaces; that the product manufactured by them does not fit into the description of any of the above three Headings and hence Chapter Heading 30.04 is the most appropriate heading which covers alcohol-based hand sanitizers. At the outset, we state that a DGFT Notification is not an authority for determining the classification of goods under GST law. Classification of goods is to be determined based solely on the description of goods given in the First Schedule to the Customs Tariff Act read together with the relevant Section Notes and Chapter Notes. Moreover, the conditions and restrictions contemplated by one statute having a different object and purpose should not be mechanically imported and applied to a fiscal statute. The reference to the ITC HS Code for Alcohol-based hand sanitizers which has been made in the DGFT Notification dated 6-5-2020 is not a standard for interpreting the classification of goods as per the Customs Tariff Act. We therefore, reject this submission of the Appellant.
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