Ayurvedic products are classifiable under Heading 3304 as cosmetics & taxable at 18%: AAR
- Blog|News|GST & Customs|
- 2 Min Read
- By Taxmann
- |
- Last Updated on 27 September, 2022
Latest from Taxmann
Case Details: Authority for Advance Rulings, Telangana Incnut Lifestyle Retail (P.) Ltd., In re - [2022] 142 taxmann.com 339 (AAR-TELANGANA)
Judiciary and Counsel Details
-
- B. Raghu Kiran & S.V. Kasi Visweswara Rao, Member
Facts of the Case
The applicant was in the business of manufacturing hair oil, shampoos etc., some of which were cosmetics and others ayurvedic medicaments. It filed an application for advance ruling to determine classification of products manufactured under the licences issued by AYUSH department of Government of Telangana and sold as ayurvedic products.
AAR Held
The Authority for Advance Ruling observed that the products referred by the applicant would be classified as cosmetic whose primary function would be care and not cure as they would be used for enhancing-improving a person’s appearance –beauty. On the other hand, the product would be treated as medicament if 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
By applying the above parameters, it was held that if the products would be used for care would be treated as ‘Cosmetics’ and classifiable under Heading 3304 which shall be taxable at 18%. However, ayurvedic products used for cure would be in nature of medicaments and classifiable under Heading 3003 which would be taxable at 12%.
Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.
Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.
The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:
- The statutory material is obtained only from the authorized and reliable sources
- All the latest developments in the judicial and legislative fields are covered
- Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
- Every content published by Taxmann is complete, accurate and lucid
- All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
- The golden rules of grammar, style and consistency are thoroughly followed
- Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied
Sign Up
To subscribe to our weekly newsletter please log in/register on Taxmann.com
Latest Books
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
