17 Jul CBIC Clarifies GST Rates and Classification of Goods: Key Highlights from Circular No. 229/23/2024-GST
The CBIC, through Circular No. 229/23/2024-GST dated July 15, 2024, has issued clarifications regarding GST rates and classification of goods based on the recommendations of the 53rd GST Council meeting held on June 22, 2024, in New Delhi. This circular, issued under section 168(1) of the Central Goods and Services Tax Act, 2017, addresses the following issues:
- GST Rate on Solar Cookers:
- Clarification was sought on the appropriate classification and GST rate for solar cookers that use dual energy sources
- The GST Council clarified that solar cookers operating on both solar energy and grid electricity fall under heading 8516 and attract a 12% GST rate as per SI. No. 201A of Schedule II of notification No. 1/2017-Central Tax (Rate) dated June 28, 2017.
- GST Rate on Fire Water Sprinklers:
- Clarification was requested on whether the existing 12% GST rate for sprinklers also applies to fire water sprinklers.
- The GST Council confirmed that all types of sprinklers, including fire water sprinklers, attract a 12% GST rate as per SI. No. 195 B of Schedule II of notification No. 1/2017-Central Tax (Rate) dated June 28, 2017.
- Past liabilities are regularized on an "as is where is basis" due to prevailing genuine doubts.
- GST Rate on Parts of Poultry-Keeping Machinery:
- Clarification was sought on the classification and GST rate for parts of poultry-keeping machinery.
- Parts of poultry-keeping machinery are classified under tariff item 8436 91 00 and attract a 12% GST rate as per SI. No. 199 of Schedule II of notification No. 1/2017-Central Tax (Rate), dated June 28, 2017. This entry has been amended to explicitly include 'parts' of poultry-keeping machinery via notification No. 2/2024-Central Tax (Rate), dated July 12, 2024.
- Past liabilities are regularized on an "as is where is basis" due to prevailing genuine doubts.
- Scope of 'Pre-Packaged and Labelled' for Agricultural Farm Produce:
- Clarification was requested on the scope of 'pre-packaged and labelled' for agricultural farm produce in light of amendments to the Legal Metrology (Packaged Commodities) Rules, 2011.
- The definition of 'pre-packaged and labelled' in notification No. 1/2017-Central Tax (Rate) and notification No. 2/2017-Central Tax (Rate), both dated June 28, 2017, has been amended via notification No. 2/2024-Central Tax (Rate) dated July 12, 2024, and notification No. 3/2024-Central Tax (Rate) dated July 12, 2024, respectively. The amendments exclude agricultural farm produce packaged in quantities greater than 25 kilograms or 25 liters from the GST levy of 5%.
- Past liabilities are regularized on an "as is where is basis" due to prevailing genuine doubts.
- Supplies of Goods Made to or by Agencies Engaged by Government:
- Prior to July 17, 2022, pulses and cereals in unit containers with registered brand names attracted a 5% GST rate.
- For the period from July 1, 2017, to July 17, 2022, supplies made to or by government agencies for distributing such goods under approved schemes at free or subsidized rates are regularized on an "as is where is basis." This is subject to:
- Suppliers furnishing a certificate from a deputy secretary or higher recommending the supplies within 180 days of this circular's issuance.
- Input Tax Credit on such inputs being reversed within 180 days if the supplier intends to benefit from this regularization.
The full circular can be accessed here.
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