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2019 (8) TMI 855 - AAR - GSTClassification of goods - rate of tax - to consider "Narcotic Chewable Tablet"(NCT) as "Nicotine Polacriliex Lozenge" in their application - benefit of N/N. 01/2017-Central Tax (Rate), dated 28-06-2017 - applicant submits that their product is classifiable under chapter heading 3004 and claims the applicable rate of 12% GST in terms of entry no.63 of schedule-II of Notification 01/2017-Central Tax (Rate) dated 28-06-2017, effective from 01.07.2017. HELD THAT:- Nicotine is an alkaloid present in tobacco leaves and it can also be obtained by synthesis. It is a colourless liquid, which turns brown when exposed to air, having a characteristic penetrating odour. It is a strong base, toxic, forms crystalline salts and can be used as a fungicide and insecticide for plants, as per the Explanatory Notes to the heading 29.39 at Sr. (G) of the Harmonised Commodity Description and Coding System. Further, the instant product is a chemical preparation made out from Nicotine and poly acrilix acid (carboxylic acid) having IUPAC name of Poly 1-Carboxycthelene. The said item does not fall under the Heading 3004. Accordingly it is not covered under Serial number 63 of Schedule 11 of Notification No.01 /2017-Central Tax (Rate) dated 28.06.2017 - The Chapter Notes and Explanatory Notes provide that preparation intended to assist smokers to stop smoking shall be covered by heading 21.06 or 38.24. We find that Chapter 21 deals with Miscellaneous edible preparations and heading 21.06 deals with food preparations not elsewhere specified or included. The instant product basically consists of nicotine which is not an edible / food preparation. Therefore the only alternative left for the classification of the instant product is chapter heading 38.24. Thus, the instant product, Nicotine Polacriliex Lozenge, is rightly classifiable under the heading 38.24. Accordingly the product is covered under Serial number 97 of Schedule III to Notification No. 01/2017-Central Tax (Rate) dated 28.06.2017 and attracts GST at the rate of 18%.
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