TaxTMI 
TaxTMI 
2026 (8) TMI 1676
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....un, Uttarakhand-248011(herein after referred to as the "applicant") and registered with GSTIN 05AABFE9410D1ZZ under the CGST 'Act, 2017 read with the provisions of the UKGST Act, 2017. 2. At the outset, we would like to state that the provisions of both the CGST Act and the SGST Act are the same except for certain provisions; therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the SGST Act. 3. The Advance Ruling under GST means a decision provided by the authority or the appellate authority to an applicant on matters or on questions specified in sub-section (2) of section 97 or sub section (1) of section 100 in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant. 4.1 As per the said sub-section (2) of Section 97 of the Act advance ruling can be sought by an applicant in respect of: (a) Classification of any goods or services or both (b) Applicability of a notification issued under the provisions of this Act, (c) Determination of time and value of supply of goods or serv....
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....edicated Toilet Soap and accordingly they seek the advance ruling on:- a. What is the correct rate of GST applicable to Medicated Toilet Soap (HSN 3401) w.e.f. 22.09.2025 ?; b. Whether Medicated Toilet Soap, being classifiable under HSN 3401, is covered under revised 5% rate applicable to Toilet Soap, or whether it continues under the general 18% slab?. SUBMISSIONS OF THE APPLICANT 5.3 In their application the applicant have made the following additional submissions at Point 16 of their application :- i. That even after changes in rate of GST effective from 22.09.2025, both Toilet Soap and Medicated Toilet Soap are covered under HSN 3401, which broadly covers " Soap,; organic surface -active products and preparations for use as soap, in the form of bars, cakes, moulded pieces or shapes ... " ii. That after 22.09.2025 the Toilet Soap, in terms of Schedule-I entry serial no. 251 of notification no. 09/2025-CT(Rate) dated 17.09.2025, has been now made eligible to GST @ 2.5% (i.e. effective rate of GST being 5%), but there is no clarity on applicable rate of GST on Medicated Toilet Soap. iii. Applicant's View: (a) That the....
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....hlorhexidine, etc .; contained anti fungal, anti bacterial and other medicinal properties; were not for ordinary use but for treatment of skin disease on prescription of a doctor; and were marketed as Medicated Soaps/ Medicated Cleansing bar, therefore, they cannot be treated as general toilet soaps. 5.4.6 Citing example of Flavoured Milk and Milk, Hair Oil and Medicated Hai Oil, Ordinary Shoes and Orthopedic shoes, it was stated that although both Toilet Soap and Medicated Soaps fall under 3401, they may attract different rate of tax based upon the wording of the notification. 5.4.7 That as per minutes of Fitment Committee, GST Council's intent was only to provide concessional rate only on mass consumption bathing soaps used in households and to exclude specialized therapeutic use soaps. Therefore extending 5% benefit to Medicated Soap would defeat the policy intention. 6. PERSONAL HEARING 6.1 The personal hearing in the matter was fixed and conducted, in virtual mode, on 26.11.2025 and the applicant was represented by their Authorized Representative Shri Rajesh Gupta, Chartered Accountant. The Concerned Officer Smt. Maneesha Saini, Deputy Commissioner (State Tax),....
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....ted, coated or covered with soap or detergent] Accordingly, all kind of soaps were leviable to 18% GST in terms of the above entry of the said Notification dated 28.06.2017. The applicant was therefore paying the tax @18% in the light of above entry on the Medicated Toilet Soap manufactured by them. y 7.4 We note that on 17.09.2025, Notification 09/2025-CT(Rate) was issued and Soap was notified both under the Schedule I (attracting GST @ 5%) as well as under Schedule II (attracting GST @ 18%). The relevant entries in these schedules are reproduced hereunder :- SCHEDULE I S.No. Chapter/ Heading/Sub-heading/ Tariff item Description of Goods 251. 3401 Toilet Soap (other than industrial soap) in form of bars, cakes, moulded pieces or shapes SCHEDULE II S.No. Chapter/ Heading/Sub-heading/ Tariff item Description of Goods 66 3401 Soap; organic surface-active products and preparations for use as soap, in the form of cakes, moulded pieces or shapes, whether or not containing soap [other than toilet soap in the form of bars, cakes, moulded pieces or shapes]; organic surface active products and preparations for washing the skin, in the fo....
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....ectants, abrasive powders, fillers or medicaments). Products containing abrasive powders remain classified in heading 3401 only if in the form of bars, cakes or moulded pieces or shapes. In other forms they are to be classified in heading 3405 as "scouring powders and similar preparations". 3401 SOAP; ORGANIC SURFACE-ACTIVE PRODUCTS AND PREPARATIONS FOR USE AS SOAP, IN THE FORM OF BARS, CAKES, MOULDED PIECES OR SHAPES, WHETHER OR NOT CONTAINING SOAP; ORGANIC SURFACE-ACTIVE PRODUCTS AND PREPARATIONS FOR WASHING THE SKIN, IN THE FORM OF LIQUID OR CREAM AND PUT UP FOR RETAIL SALE, WHETHER OR NOT CONTAINING SOAP; PAPER, WADDING, FELT AND NONWOVENS, IMPREGNATED, COATED OR COVERED WITH SOAP OR DETERGENT - Soap and organic surface-active products and preparations, in the form of bars, cakes, moulded pieces or shapes, and paper, wadding, felt and nonwovens, impregnated, coated or covered with soap or detergent : 3401 11 - - For toilet use (including medicated products): 3401 11 10 - - - Medicated toilet soaps KGS 3401 11 20 - - - Shaving soaps other than shaving cream KGS 3401 1....
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....lded pieces or shapes. 8.2 At the outset we have observed that industrial soaps have specifically been kept out from the purview of Entry 251 of the Schedule I of the said Notification dated 17.09.2025. We have gone through the description of 'industrial soap' given in https://design-encyclopedia.com/?T=Industrial%20Soap and the same reads as under:- Industrial soap refers to a type of soap that is specifically designed for use in industrial settings. It is typically formulated to be more effective at removing heavy-duty dirt, grease, and grime than traditional household soaps. Industrial soap is commonly used in a variety of industries, including manufacturing, automotive, and construction, among others. The formulation of industrial soap typically includes a combination of surfactants, which are compounds that help to break down and remove dirt and grease, as well as other ingredients such as abrasives and solvents. These ingredients work together to create a powerful cleaning solution that is capable of tackling even the toughest industrial cleaning tasks. Industrial soap is available in a variety of forms, including liquid, powder, and bar soap ... 9.3 Fu....