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General alchocal based Hand Sanitizer (used for disinfecting hands) not to be considered as medicament and to be taxable at higher rate of 18% as against the lower rate of 12% for madicaments: Says AAR 

In this application, Applicant claimed that Hand Sanitizers are covered under HSN 30049087 and taxable at 12% GST.

However Authority held that HSN 3004 refers to medicaments for therapeutic or prophylactic uses. Hand sanitizers are primarily used for disinfecting / Sanitizing hands. General sanitizer is used as an alternative to wash hands (to maintain hygiene) hence general alcohol-based hand sanitizer without any curative or preventive ingredients, may not be considered as a medicament. The same to be classifiable under HSN 3808 @ 18% GST. 

M/S. SPRINGFIELDS (INDIA) DISTILLERIES
(AAR, Goa)

Facts of Case

The applicant Springfields (India) Distilleries is a registered partnership firm manufacturing Hand Sanitizers.

Applicant has asked for advance ruling on the issue as to classification of the Goods namely "Hand Sanitizer" and rate of GST to be applied. 

Applicant also seeks opinion on whether Hand Sanitizers supplied by them are exempt from GST as the same has been classified by Ministry of Consmer Affairs as essential commodity under the Essential Commodities Act, 1955.

Applicant is of the opinion that Hand Sanitizers are covered under HSN 30049087 and to be taxed @ 12% under GST.

Comments of Officer

The applicant has referred to HSN code 30049087 in this application. Tariff Item: 3004 refers to medicaments for therapeutic or prophylactic uses. Hand sanitizers are primarily used for disinfecting / Sanitizing hands. General sanitizer is used as an alternative to wash hands (to maintain hygiene) hence general alcohol-based hand sanitizer without any curative or preventive ingredients, may not be considered as a medicament.

Held by Authority

This authority is of the opinion that Hand Sanitizers manufactured by the applicant are of the category of Alcobased hand sanitizers and are classifiable under heading 3808 of HSN to which rate of GST applicable is 18%. As far as exempting hand sanitizers as 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 commodity will not be the criteria for exempting such Goods from GST.


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Author:

TaxReply


Jul 14, 2020

Comments


There are 2 types of Hand Sanitizer, 1 of Gel Form & 2 of Liquid form made from Rectified Sprit. Now, please clarify the HSN code & Rate of GST on both types clearly. Thank-you IKRAMUDDIN SAIFI
By: Ikramuddin | Dt: Jul 15, 2020


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