The Karnataka Authority of Advance Ruling (AAR) ruled that 18% GST is payable on Baby Wipes.
The Applicant, M/s Extracare Products Private Limited has been engaged in Import and trading of baby wipes. A dispute on the classification of baby wipes has been settled by the order of Commissioner of Customs (Appeals-II), Chennai as per which the classification of baby wipes is 96190010. The applicant has been classifying the baby wipes under the heading 9619 0010 and discharging the duty accordingly. Meanwhile a Circular bearing No.52/26/2018-GST dated 09.08.2018 was issued by CBIC, which dealt with classification of wipes manufactured using spun lace non-woven fabric and also dealt with HSN codes 3307, 3401 and 5603 and the applicant, on the basis of the said circular & taking cautious view is charging 18% GST from August 2018.
The applicant has sought the advance ruling in respect of HSN Code of baby wipes classification, rate of tax to be levied on baby wipes and if Circular No.52/26/2018 GST-dated 9h August 2018, is not applicable to the applicant, whether the applicant can go back and charge GST at the rate of 12% since there exists ambiguity in this regard.
The Coram of Dr. M.P.Ravi Prasad and T. Kiran Reddy ruled that the Tariff heading 9619 covers articles having multiple layers designed to absorb and store fluid. Generally, these articles are shaped so as to fit snugly to the human body. In the instant case, the impugned baby wipes’ are neither designed to absorb and store fluids nor are shaped to fit the human body and hence cannot be classified under tariff heading 9619.
“Thus the product “baby wipes” merits classification under tariff heading 3307 and attracts 18% GST, in terms of Circular supra dated 09.08.2018,” the AAR ruled.
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