BRAND NAMES & COMPENSATION CESS.

[Sadanand Bulbule]

Dear Sirs

Under the GST(Compensation Cess Act,2017) different rates of Compensation Cess are prescribed besides the levy of applicable CGST/SGST/IGST/UTGST on notified goods as the case may be.

A dealer who supplies certain goods in bulk under some 'brand name' and collects the applicable GST and Cess too to another registered dealer. Later the buying dealer who the supplies 'those' goods in very very small quantity along with some incidental services in 'unbranded name' to the end consumers.Under such peculiar circumstances, whether the second supplier of those specific goods together with some incidental services need to pay the same rate of Cess as paid on 'branded name' or is eligible to collect and the rate of Compensation Cess on supply of those goods in'unbranded name' format.

Pl clarify the legal position with any citations.

AI Summary

GST Compensation Cess: Branded vs. Unbranded Hookah Products and Tobacco Content Impact on Cess Rate A query was raised about the applicability of Compensation Cess under the GST Compensation Cess Act, 2017, for goods supplied under a brand name versus unbranded goods. A dealer supplies hookah products in bulk under a brand name to another dealer, who then sells them in small quantities without a brand name. The question is whether the second supplier must pay the same rate of Cess. Replies indicated that the Cess rate depends on whether the hookah contains tobacco and if it is branded. Tobacco-free or unbranded hookah is subject to a lower Cess rate of 17% as per Notification No. 01/2017.