GST classification of health supplements depends on statutory character; FSSAI-governed products are not medicaments merely due to therapeutic use.
GST classification of health supplements turns on the product's statutory character and the applicable regulatory regime. Products that are in substance nutraceuticals, prebiotic or probiotic supplements, oral rehydration formulations, or similar food preparations governed by the FSSAI framework do not become medicaments merely because they are used on medical advice, sold through pharmacists, or bear therapeutic or prophylactic claims. The FSSAI regime and the Drugs and Cosmetics Act, 1940 operate in mutually exclusive fields. Accordingly, the products discussed were held to fall under HSN 2106 and not under Chapter 30 as drugs or medicaments.
Issues: Whether the products manufactured by the appellant were classifiable as medicaments/drugs under Chapter 30 or as food supplements under HSN 2106 for GST purposes.
Analysis: The products were examined with reference to their composition, the FSSAI regulatory framework, and the Drugs and Cosmetics Act, 1940. The regulatory scheme showed that health supplements, nutraceuticals, probiotics, and food for special dietary or medical use are governed by the FSSAI Regulations, while drugs and medicines fall within the Drugs and Cosmetics Act, 1940. The existence of prescriptions, limited-period use, pharmacist sale, or labeling did not by itself establish medicinal classification. The Court held that the two statutory regimes operate in mutually exclusive fields and that the products in question were mainly prebiotic/probiotic supplements, oral rehydration formulations, and tonics excluded from Chapter 30 treatment despite any therapeutic or prophylactic attributes.
Conclusion: The products were correctly classified under HSN 2106 and were not classifiable as medicaments or drugs.
Final Conclusion: The challenge to the advance ruling failed, and the classification adopted by the authority was upheld.
Ratio Decidendi: For GST classification, products that are in substance health supplements, nutraceuticals, or similar food preparations governed by the FSSAI framework do not become medicaments merely because they are used on medical advice or have therapeutic or prophylactic properties; the classification depends on the statutory character of the product and the mutually exclusive regulatory regime applicable to it.
TaxTMI 
AI Drafter ✕
TaxTMI 
