In re Surya Ayurved (GST AAR Uttar Pradesh)
Q-1 Applicable G.S.T rate on Himsa Plus Oil, which is a ayurvedic Hair oil used for various hair disease and headache)?
Ans-1 Himsa Plus Oil merits Classification under Chapter heading 3305.90 and attracts G.S.T @ 18% (CGST 9% and SGST 9%).
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, UTTAR PRADESH
1. M/s Surya Ayurved, 110A(1), Patel Nagar, GT Road, Kanpur-208007 (here in after referred to as the applicant) is a registered assessee under GST having GSTN: 09ATXPS8213K1ZP.
2. The applicant has sought advance ruling on following question-
(1) Applicable GST rate on Himsa Plus Oil, which is a ayurvedic hair oil used for various hair disease and headache.
3. As per declaration given by the applicant in Form ARA-01, the issue raised by the applicant is neither pending nor decided in any proceedings under any of the provisions of the Act, against the applicant.
4. As per statement of facts submitted by the applicant-
(1) The applicant is manufacturer of ayurvedic medicine under license of Drug Licensing Authority, UP.
(2) the applicable tax rate on ayurvedic medicine is 12%.
5. As per product label attached with the application, the Himsa Plus Oil is Prop. Ayur. Medicine and is a herbal cool oil for effective relief from-
(a) Physical and Mental stress and strain
(b) Heating sensation in brain and tension
(c) Bodyache and Joint pain
(d) Loss of memory
(e) Sleeplessness
(f) Premature hair fall
(g) Dandruff and itching
(h) Muscular and nervous strain and pain
(i) Headache, Sinus and Migraine
(j) Bruises
(k) Boil and Pimple
(l) Poisonous insect bite.
6. The application for advance ruling was forwarded to the Jurisdictional GST Officer to offer their comments/views/verification report on the matter. The Additional Commissioner, Grade-1, Commercial Tax, Kanpur Zone-Second, Kanpur vide his letter C. No. 1408/ ………………/2020-21 dated 27.03.2021 has opined that Himsa Plus Oil falls under Chapter Heading 330590 and taxable @ 18% citing as under:-
“The taxability of product manufactured by firm is clearly mentioned on notes for Chapter-30 (HSN Classification)
As read Chapter-30 Pharmaceuticals product
Notes:
1. This Chapter does not cover:
9(a) ………………(d)
(e) preparation of headings 3303 to 3307 even if they have therapeutic or prophylactic properties:
…………….. (h)
The product Himsa plus oil clearly falls under Chapter-33 subheading 330590-Hair Oil thus taxable 18% (@9% COST & @ 9% SGST). “
It was also confirmed that no proceedings is pending under UPGST Act regarding question raised in application of advance ruling.
7. The applicant was granted a personal hearing on 25.05.2021 which was attended by Shri Anurag Singh, Charted Accountant/Authorized representative. During personal hearing, he reiterated the submissions made in the application of advance ruling and explained the composition of product.
DISCUSSION AND FINDING
8. At the outset, we would like to make it clear that the provisions of both the CGST Act and the UPGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the UPGST Act. Further for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / UPGST Act would be mentioned as being under the ‘CGST Act’.
9. We have gone through the submissions made by the applicant and have examined the explanation submitted by them. At the outset, we find that the issue raised in the application is squarely covered under Section 97(2)(a) of the CGST Act 2017 being a matter related to classification of goods. We therefore, admit the application for consideration on merits.
10. We observe that the applicant has sought advance ruling on the issue-
(1) Applicable GST rate on Himsa Plus Oil, which is a ayurvedic hair oil used for various hair disease and headache.
11. As per Section 9(1) of the CGST Act, 2017, the levy of tax is on the supply of goods or services “at such rates” as may be notified by the Government on the recommendations of the Council. Accordingly, Notification No. 1/2017-Central Tax (Rate) dated 28-Jun-2017 has been issued to notify the rates. This notification divides all the goods into 6 Schedules, as follows:-
i. 2.5% (Schedule I);
ii. 6% (Schedule II);
iii. 9% (Schedule III);
iv. 14% (Schedule IV);
v. 1.5% (Schedule V); and
vi. 0.125% (Schedule VI)
12. The Explanation (iii) of the said notification No. 01/2017-Central tax (Rate) dated 28.06.2017 states that “Tariff item”, “sub-heading” “heading” and “Chapter” shall mean as specified in the First Schedule to the Customs Tariff Act, 1975 and Explanation (iv) of the said notification states that the rules for the interpretation of the First Schedule to the said Act including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of this notification.
13. The applicant has submitted that the applicable rate on ayurvedic medicines is 12% and Himsa Plus Oil is a ayurvedic hair oil used for various hair disease and headache. To determine the rate of tax on the products in question we need to examine the relevant competing entries concerning the product in question. The relevant entries of notification No. 01/2017-Central tax (Rate) dated 28.06.2017 are reproduced hereunder: –
Schedule II- 6%
