GST on supply of Ayurvedic products under AYUSH Department licenses

By Editor4 Goods and Services Tax Judiciary July 15, 2022 1 comment

TaxGuru Citation: 2022 taxguru.in 4256
Case Name: In re Incnut Lifestyle Retail Private Limited (GST AAR Telangana)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Courts: AAR/AAAR Telangana, Advance Rulings

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In re Incnut Lifestyle Retail Private Limited (GST AAR Telangana)

The applicant claims to be manufacturing Ayurvedic products under licenses issued by AYUSH Department of Government of Telangana. The applicant therefore is of the opinion that all the products manufactured by the applicant can be classified as Ayurvedic medicaments under chapter sub-heading ‘30049011’ @12% under GST.

Authority for advance ruling propose to classify the products either as a cosmetic whose primary function is care and not cure which is used for enhancing-improving a person’s appearance -beauty or on the other hand a medicament used to treat or cure a medical condition by adopting the following parameters:

a) The product should have a drug license.

b) The Composition of the product should have medical ingredients.

c) The product label/character should indicate the function or the purpose for which it is used.

It is seen that all the products mentioned above have a drug license and have Ayurvedic ingredients, but the purpose and function as seen from the literature submitted differ therefore a conclusion for each of the products seprately. AAR held as under –

Questions

Ruling

Whether the products manufactured by him under the licences issued by AYUSH department of Government of Telangana and sold as Ayurvedic products fall under HSN No. 30.04 or under HSN 3304 of the GST Tariff?

The products referred by the applicant are classified as medicament or cosmetic based on the following parameters: