Harpic Toilet Cleaner and Lizol Floor Cleaner are not Insecticides, Taxable at 12.5%: Supreme Court

The Supreme Court has recently held that Harpic Toilet Cleaner and Lizol Floor Cleaner are not classifiable under insecticides and they should be taxable at 12.5%.

Appellant Reckitt Benckiser (India) Ltd filed an appeal before the High Court of Kerala against the order of Commissioner Commercial Taxes who determined the tax rate of Harpic Toilet Cleaner and Lizol Floor Cleaner under the Kerala Value Added Tax Act.

The commissioner of commercial taxes contended that Harpic Toilet Cleaner and Lizol Floor Cleaner are classifiable under SI No. 27(4) of the said Notification SRO 82/06.

Siddharth   Bawa, counsel for the appellant submitted that Harpic and  Lizol would still continue to fall in Entry 44(5) even after the deletion of HSN Code 3808 as they are disinfectants under the Drugs and Cosmetics Act/Rules and manufactured under the license granted as a disinfectant, under the said act.

Shri C.K. Sasi, counsel for the respondent submitted that products such as Harpic Toilet Cleaner and  Lizol  Floor  Cleaner are not used in relation to controlling pets and insecticides in the agricultural field. The name of these products contains the words “Toilet Cleaner and Floor Cleaner”.

Further, the counsel contended that the use of “Harpic Toilet Cleaner” and “Lizol Floor Cleaner” is exclusively for cleaning of toilet and floor respectively and therefore could not be treated as an insecticide.

The single bench of the Supreme Court considered the observation of the High Court that Harpic Toilet   Cleaner” and  “Lizol Floor Cleaner are used for cleaning the floor and toilet also the two items are essentially used as stain removers and deodorants. Merely because they kill germs as well, the same cannot be said to be insecticides classifiable under Entry 44(5).

Thereafter the bench of Justice M R Shah dismissed the appeal of the assessee and held that product Harpic and Lizol should not be classifiable under Entry 44(5) and shall be classifiable under Entry 27(4) of SRO 82/2006 chargeable to tax at 12.5%.

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates