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Home Case Index All Cases GST GST + AAR GST - 2020 (6) TMI AAR This

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2020 (6) TMI 488 - AAR - GST


Issues: Classification of goods under GST - Henna/Mehendi powder.

Analysis:
1. Submission and Interpretation of the Applicant: The applicant, engaged in manufacturing hair dye powder, seeks clarification on the classification and GST rate for future production of mehandi/henna powder. The applicant relied on the HSN code 14041019 for henna powder during GST registration, indicating classification under Chapter 14 with a 5% GST rate. The applicant referenced amendments and fitment committee recommendations to support the classification under HSN code 1404 with a 5% GST rate.

2. Questions on Which the Advance Ruling is Sought: The primary question is whether henna should be classified under Chapter 14 or 33 for GST purposes.

3. Personal Hearing: The applicant was granted a personal hearing where the authorized representative reiterated the application's submissions, emphasizing early disposal.

4. Comments of the Jurisdictional Officer: The jurisdictional officer classified artificial henna and henna products under Chapter 33, attracting an 18% GST rate as cosmetic items.

5. Findings Analysis & Conclusion: The ruling authority considered the nature of henna/mehendi as a dye derived from the Lawsonia inermis plant. Analyzing the Customs Tariff Act, 1975 amendments, the authority noted the omission of relevant tariff items, leading to the classification of henna/mehendi powder under Chapter 33. Referring to Notification No. 41/2017, the authority concluded that henna/mehendi powder falls under preparations for hair use, attracting an 18% GST rate (CGST 9% + SGST 9%).

6. Ruling: The ruling confirmed that mehendi/henna powder falls under Chapter 33 and is subject to an 18% GST rate (CGST 9% + SGST 9%).

 

 

 

 

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