Chapter 33 - Essential oils and resinoids, perfumery, cosmetic or toilet preparations

Varied practices are being followed regarding the classification of baby wipes, facial tissues and other similar products, and references have been received requesting for correct classification of these products. As per the references, these products are currently being classified under different HS codes namely 3307, 3401 and 5603 by the industry.<br>Commercially, wipes are categorized into various types such as baby wipes, facial wipes, disinfectant wipes, make-up remover wipes etc. These products are generally made by using non-woven fabrics of viscose and polyviscous blend and are sprinkled with demineralized water and various chemicals and fragrances, which impart the essential character to the product. The base raw materials are moisturising and cleansing agents, preservatives, aqua base, cooling agents, perfumes etc. The textile material is present as a carrying medium of these cleaning/wiping components.<br>According to the General Rules for Interpretation [GRI-3(b)] of the First Schedule to the Customs Tariff Act (CTA), 1975, "Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable." Since primary function of the article should be taken into consideration while deciding the classification, it is clear that the essential character of the wipes in the instant case is imparted by the components which are to be mixed with the textile material.<br>As per the explanatory notes to the HSN, the HS code 5603 clearly excludes non-woven, impregnated, coated or covered with substances or preparations such as perfumes or cosmetics, soaps or detergents, polishes, creams or similar preparations. The HSN is reproduced as follows: "The heading also excludes: Nonwoven, impregnated, coated or covered with substances or preparations [i.e. perfumes or cosmetics (Chapter 33), soaps or detergents (heading 3401), polishes, creams, or similar preparations (heading 3405), fabric, softeners (heading 3809)) where the textile material is present merely as a carrying medium. Further, HS code 3307 covers wadding, felt and non-woven, impregnated, coated or covered with perfumes or cosmetics. The HS code 3401, would cover paper, wadding, felt and non-woven impregnated, coated or covered with soap or detergent whether or not perfumed".<br>Further, as per the explanatory notes to the HSN, the heading 3307 includes wadding, felt and nonwovens impregnated, coated or covered with perfume or cosmetics. Similarly, as per explanatory notes to the HSN, the heading 3401 includes wipes made of paper, wadding, felt and nonwovens, impregnated, coated or covered with soap or detergent, whether or not perfumed or put up for retail sale.<br>Thus, the wipes of various kinds (as stated above) are classifiable under heading 3307 or 3401 depending upon their constituents as discussed above. Therefore, if the baby wipes are impregnated with perfumes or cosmetics, then the same would fall under HS code 3307 and would attract 18% GST rate. Similarly, if they are coated with soap or detergent, then it would fall under HS code 3401 and would attract 18% GST.

Baby wipes are classified on the basis of material and impregnating materials as: <br>o Prior to 15-11-2017, Baby wipes consisting of Paper wadding, felt and nonwovens, impregnated. coated or covered with soap or detergent, whether or not perfumed p up d or t u for retail sale, falls under HS code 3401 and attracts 28% GST. With effect from l5-11-2017 it attracts 18% GST. [Notification No. 41/2017-Central Tax (Rate)] <br> o And those consisting of, wadding, felt and nonwovens impregnated, coated or covered with perfume or cosmetics fall under HS code 3307 and attract 18% GST. [Notification No. 41/2017-Central Tax (Rate)]

Henna powder; Shikakai powder sold in unit packaging with labels indicating its use for the hair are properly classifiable under Heading 33.05 and not under Chapter 14. Mayan Henna Herbal Pvt. Ltd., v Commissioner, 2012 (281) ELT 118 (Tri. - Del.); Henna Export Corporation v Collector, 1993 (67) ELT 907 (Tribunal). This judgment was maintained by Hon 'ble Supreme Court.

Nail Polish whether in large quantities say 50 to 100 litres or in retail packs] falls under heading 3304. Prior to 15-11-2017, Nail Polish attracted 28% GST. With effect from 15-11-2017, Nail Polish attracts 18% GST. [Notification No. 41/2017-Central Tax (Rate)] CAL & C Circular E No. 332/2/2017-TRU, dated 7-12-2017

Lobhan is classified under HS code 3307 41 00. Prior to 22-9-2017, lobhan attracted 12% GST. With effect from 22-9-2017, lobhan attracts 5% GST. [Notification No. 27/2017-Central Tax (Rate)] C.B.I. & C. Circular F. No. 332/2/2017-TRU, dated 7-12-2017

Masala pudis, Amla pudi, Dudhi pudi, Brahmi pudi, Mehndi pudi etc. containing amla powder, mehndi leaves powder as main ingredients as well as different other ingredients also and packed and sold to household buyers to prepare hair oil are classifiable under Chapter 14 and not under Heading 33.05, Commissioner v M.M. Kambhatwala 2010 (255) ELT 588 (Tri.-Ahmd.). This Judgment was maintained by Hon'ble Supreme Court.

is nothing but soap nut powder hence classifiable under Chapter 14 and not under heading 33.05. SRK Products v Commissioner 2007 (213) ELT 34 (Tri.-Bang.). This judgment was affirmed by Hon'ble Supreme Court.

made of spun lace non-woven fabric- classifiable under Heading 3307 or 3401 depending upon their constituents. If these products are impregnated with perfumes or cosmetics, the same would fall under HS Code 3307 and if they are coated with soap or detergent, then it would fall under HS Code 3401, In Re: Ginni Filaments Ltd., 2019 (23) G.S.T.L. 222 (A.A.R - GST)

In Re: Akansh Hair And Skin Care Herbal Unit Pvt. Ltd. 2018 (16) G.S.T.L. 277 (App. A.A.R. - GST <br>o The products are used mostly for brightening the skin, controlling the excess oil secretion, keeping skin clean glossy and free of freckles and spots, beautifying the skin of sunburn and black patches, ensuring dazzling liveliness, enhancing glamour and beauty, preventing excessive perspiration, promoting feeling of freshness, increasing lustre of skin, keeping skin soft, fair, glowing, stop pre-mature ageing and wrinkling of skin, preventing sun burn rashes, dryness, discolouration and burning sensation of skin. properly cleansing, exfoliating and moisturizing the skin, helping for removal of make-ups and sunscreen which clogs pores, helping in the normal firming and toning of skin along with hydrating the skin to make it glow, fresh and smooth, helping to skin and tighten skin pores, makes skin soft and more elastic, reducing excess skin oil, protecting from sun-burn injury.<br> o None of the above descriptions qualify for categorising the products as "medicaments" or "medicines" as they are not used in the diagnosis, treatment, mitigation or prevention of disease or disorder in human beings; rather they are more in tandem with the definition of 'cosmetics' as we find in the Drugs and Cosmetics Act, 1940, because none of the problems that these products treat can be classified as "injury" or "ailment". <br>o The General Explanation to Chapter 33 states that The products of Headings 33.03 to 33.07 remain in these headings whether or not they contain subsidiary pharmaceutical or disinfectant constituents or are held out as having subsidiary therapeutic or Prophylactic value. <br> o Skin Care Products are not to be classified under Chapter 30, but are to be classified under Chapter 33 (Cosmetics) or Chapter 34 and are to be taxed accordingly.