Imitation zari thread classifiable as metallised yarn under heading 5605 attracts the 5% GST rate.

Imitation zari thread or yarn made from metallised polyester film or plastic film is classifiable in heading 5605 under the trade parlance test, read with the tariff notes and GST clarification. The ruling treats such goods as metallised yarn or imitation zari thread, and after the 2023 amendment they fall in the 5% GST entry instead of the higher-rate entry. The same 5% treatment continues under the later notification effective from 22.09.2025.

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Issues: Whether imitation zari thread or yarn made from plastic film or lacquered coated polyester film with aluminium metal is classifiable under HSN 56050020 and liable to GST at 5%.

Analysis: The applicable tariff entry and GST notifications, read with the explanatory notes and the GST Council clarification, show that metallised yarn or imitation zari thread known by any name in trade parlance, including products made from metallised polyester film or plastic film, falls within heading 5605. After the 2023 amendment, such goods were carved out of the higher-rate entry and placed in the 5% entry. The later notification effective from 22.09.2025 also continues the same treatment for imitation zari thread or yarn in trade parlance.

Conclusion: The product is classifiable under HSN 56050020 and is leviable to GST at 5% from 27.07.2023 to 21.09.2025 and thereafter under the corresponding 5% entry effective from 22.09.2025.

Ratio Decidendi: Imitation zari thread or yarn made from metallised polyester film or plastic film, when understood in trade parlance and supported by the tariff notes and GST clarification, is to be classified as metallised yarn under heading 5605 and taxed at the applicable 5% rate.

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