Per piece valuation: multi-pack apparel taxed by sale value per independently usable set, yielding the lower GST rate.

Each pyjama set (one top and one bottom) constitutes a 'piece' for application of the notified GST schedules; a multi-pack containing two such sets is not treated as a single retail unit for threshold purposes. The applicable notifications require assessing sale value per piece, and where the pack price divided by number of independently usable sets yields a per-piece value below the notified threshold, the lower rate entry applies. Applying that test to the facts produced a per-piece value below the threshold, resulting in GST at 5% on the transaction.

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Issues: Whether the applicable GST rate on two men's pyjama sets packed in a single pack must be determined per pack (treating the multi-pack as a single retail unit) or per piece/set (treating each pyjama set as a separate piece for the purpose of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 and Notification No. 9/2025-Central Tax (Rate) dated 17.09.2025).

Analysis: The Appellate Authority examined the nature of the product (a pyjama set consisting of one top and one bottom), the packing (two such sets in a single pack per buyer instruction), the language of the relevant notifications and schedules which prescribe rates based on sale value "per piece", and the ordinary meaning and commercial understanding of "pyjama set" as a piece comprising top and bottom. The Authority considered whether a multi-pack containing multiple sets should be treated as a single retail unit for rate threshold purposes and observed that a pack containing multiple sets does not necessarily become a single retail unit; the relevant determination under the Notifications is the sale value per piece, where a piece is an independently usable apparel (here, one pyjama set). The Authority applied the notified schedules (Schedule I and Schedule II of Notification No. 1/2017 and the amended thresholds in Notification No. 9/2025) to the facts: the pack price of Rs. 1,371 represents two pieces (two pyjama sets), producing a per-piece price below the notified threshold, and therefore falling within the lower rate entry.

Conclusion: The Appellate Authority upheld the AAR ruling that each pyjama set (one top and one bottom) is a "piece" for the purposes of the Notifications; since the effective sale value per piece is Rs. 686 (less than the notified threshold), the transaction is liable to GST at 5% (CGST 2.5% + SGST 2.5%) and the appeal is dismissed.

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