Dietary supplements are not medicaments when labelled as food products and classified instead under the residuary tariff heading.
Products described and labelled as dietary or health supplements were not classifiable as medicaments under Heading 3004 because classification depends on common parlance, consumer perception and whether the goods are primarily intended for therapeutic or prophylactic use. The labels stated that they were not meant to diagnose, treat, cure or prevent disease, and the materials did not establish medicinal character; they therefore fell outside Chapter 30. As no other specific heading applied, the goods were classified under Heading 2106 as food preparations not elsewhere specified or included and were taxable under the relevant GST Schedule III entry.
Issues: (i) Whether the products described and labelled as dietary or health supplements were classifiable as medicaments under Heading 3004 of the Customs Tariff Act, 1975. (ii) If not so classifiable, whether those products were classifiable under Heading 2106 and liable to tax accordingly.
Issue (i): Whether the products described and labelled as dietary or health supplements were classifiable as medicaments under Heading 3004 of the Customs Tariff Act, 1975.
Analysis: Classification depends on the nature and character of the goods as understood in common parlance and by the consumer. For Heading 3004, the product must have substantial therapeutic or prophylactic value and must be primarily meant for treatment, mitigation, cure or prevention of a disease or disorder. The labels of the products admitted for ruling described them as dietary or health supplements, and some labels expressly stated that they were not intended to diagnose, treat, cure or prevent disease. Food supplements are excluded from Chapter 30 by Note 1(a), and the materials produced did not establish that these goods were offered or consumed primarily as medicines.
Conclusion: The products under consideration were not classifiable as medicaments under Heading 3004.
Issue (ii): If not so classifiable, whether those products were classifiable under Heading 2106 and liable to tax accordingly.
Analysis: Since the goods were food supplements and not medicaments, and no specific heading covered them elsewhere, they fell within the residuary entry for food preparations not elsewhere specified or included. The rate notifications under the GST framework applied the tariff headings of the Customs Tariff Act, 1975, and the relevant entry placed such goods in Schedule III.
Conclusion: The products were classifiable under Heading 2106 and taxable under the relevant entry in Schedule III.
Final Conclusion: The admitted products labelled as dietary or health supplements were held to be food supplements outside Chapter 30 and to fall under Heading 2106 for GST rate purposes.
Ratio Decidendi: A product is classifiable as a medicament only if, judged by common parlance and consumer perception, it is primarily intended for therapeutic or prophylactic use; products presented and labelled as food or health supplements fall outside Chapter 30 and are classifiable under the appropriate residuary tariff heading.
TaxTMI 
AI Drafter ✕
TaxTMI 
