GST

Alcohol based Hand Sanitizers subject to 18% GST; No exemption of being ‘essential commodity’: AAR, GOA

Applicant:  Springfields (India) Distilleries

Fact of the case

  • The applicant, Springfields (India) Distilleries is a registered partnership firm manufacturing Hand Sanitizers vide License issued by Directorate of Food and Drug Administration.
  • Applicant is of the opinion that Hand Sanitizers are covered under HSN 30049087 and to be taxed @ 12% under GST.
  • Further the applicant also seeks opinion on whether Hand Sanitizers supplied by them are classified as essential commodity to be exempt from GST.

Questions of which Ruling was sought

  • Hand Sanitizer is covered under which HSN and what is the rate of tax applicable?
  • The Ministry of Consumer affairs , Food and Public Distribution in a Notification No.CG-DL-E13032020-208645 has classified Hand Sanitizers under the Essential Commodities Act, 1955 as an essential commodity and thus whether Hand Sanitizers are exempt from GST.

R U L I N G

The AAR ruled that Alcohol-Based Hand Sanitizers manufactured by the applicant are covered by HSN 3808 and are accordingly taxable at the rate of 18%.

The AAR stated in its order that hand sanitizers as an essential commodity since it is classified as such by Ministry of Consumer Affairs, Food, and Public Distribution, this Authority is of the view that Exempted goods are covered by Notification no. 2/2017- Central Tax (Rate) dated 28/06/2017. Merely classifying any goods as essential commodities will not be the criteria for exempting such Goods from GST.

 

http://gstcouncil.gov.in/sites/default/files/ruling-new/Goa_AAR_01_2020-21_29.06.2020_SID.pdf

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