In re M/s. Udyog Mandir (GST AAR Rajasthan)
Will Khadi readymade garments to be included under the entry of Khadi fabric under chapter 50 to 55 of GST classification?
Khadi readymade garments are not covered under the entry of 130A, chapter heading 50 to 55 of Notification No. 02/2017-Central Tax (Rate) dated 28.06.2017.
If not, then what is the correct classification and rate of tax on Khadi readymade garments?
Khadi readymade garments will be classifiable under Chapter heading/ tariff item 62, as per Notification No. 01/2017-Central Tax (Rate) dated 28.06.2017 will attract GST as follows-:
a. If the sale value of a ready made khadi garments manufactured by the applicant is less than Rs. 1000/- will attract GST @ 5% (SGST 2.5% + CGST 2.5%);
b. If the sale value of a readymade khadi garments manufactured by the applicant is more than Rs. 1000/- will attract GST @ 12% (SGST 6% + CGST 6%).
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, RAJASTHAN
Note: Under Section 100 of the CGST/ RGST Act, 2017, an appeal against this ruling lies before the Appellate Authority for Advance Ruling constituted under section 99 of CGST/ RGST Act, 2017, within a period of 30 days from the date of service of this order.
The issue raised by M/ s Udyog Mandir situated at Amer, Jaipur, Rajasthan 302028 (hereinafter the applicant) is fit to pronounce advance ruling as it falls under the ambit of the Section 97(2) (a) given as under :
a. Classification of any goods or services or both;
Further, the applicant being a registered person (GSTIN is 08AAAAU0674M1Z5, as per the declaration given by him in Form ARA-01) the issue raised by the applicant is neither pending for proceedings nor proceedings were passed by any authority. Based on the above observations, the applicant is admitted to pronounce advance ruling.
1. SUBMISSION AND INTERPRETATION OF THE APPLICANT:
The applicant is a manufacturer of Khadi garments who buys Khadi fabrics from the market and get those fabrics stitched and makes own garments. The Khadi fabrics has been made exempt from tax vide Notification No. 28/2017-Central Tax (Rate) vide inserting an entry at Serial No. 130A in Notification No. 02/2017 Central Tax(Rate). The entry is as follows:-
