Ahmedabad: The Gujarat Appellate Authority for Advance Ruling, Goods and Service Tax, turned down an appeal filed by a firm seeking a reduction from the current 28% GST slab for its ‘herbal smoke’.
The smoke sticks that the firm sells fall neither in the category of ‘medicinal cigarette’ nor do they have certification from the ministry of AYUSH that they are ayurvedic products.
The firm involved in this case is Aorom Herbotech, which manufactures and sells Aorom Herbal Smoke, classified under the category to be taxed at 28% GST. The firm sought an advance ruling from the authority and the appellate body, contending that the ingredients used in the smoke sticks are tendu leaves, nutmeg, fennel powder, liquid glucose, propylene glycol, sorbitol, menthol, baking soda, flavouring additive, empty paper tubes, and filter with no tobacco or nicotine.
It submitted that herbal smoke is an ancient practice to address the root cause of diseases, mentioned in ayurveda as dhummapana, a common practice in ayurvedic treatment.
The firm sought a different classification for its product on the grounds that it has healing effects and discourages the habit of smoking. The Gujarat Authority for Advance Ruling, GST, rejected the firm’s application after which it approached the appellate authority.
The appellate authority also rejected the firm’s claim that its smoke sticks are medicinal cigarettes manufactured according to ayurveda. It stated that the firm is “not in a position to pinpoint the authoritative books of ayurveda according to which the goods were manufactured…The appellants do not hold any licence permitting them to manufacture the goods.
They failed in making out a case of their product falling under the category of medicinal cigarettes.”
For coming to this conclusion, the appellate body cited the firm’s communication to the ministry of Ayush, stating that the joint commissioner of FDCA (ayurveda) refused to grant them an ayurveda licence, stating the product does not fall under any category of ayurveda books.
The appellate body also rejected the firm’s contention that the product discourages the habit of smoking. It said that the firm admitted that the product is a substitute for cigarettes and is also manufactured and marketed with the said aim in mind. This belies the fact that the product is intended to assist smokers in quitting smoking.
The firm argued that its herbal smoke helps cure cough, cold, bronchitis and asthma in the way dhummapana is recognised as an approved method in ayurveda by the Ayush ministry and the National Institute of Ayurveda. However, the appellate authority did not accept this claim in the absence of a licence for manufacturing ayurvedic medicine from a regulatory body.
Ahmedabad: The Gujarat Appellate Authority for Advance Ruling, Goods and Service Tax, turned down an appeal filed by a firm seeking a reduction from the current 28% GST slab for its ‘herbal smoke’.
The smoke sticks that the firm sells fall neither in the category of ‘medicinal cigarette’ nor do they have certification from the ministry of AYUSH that they are ayurvedic products.
The firm involved in this case is Aorom Herbotech, which manufactures and sells Aorom Herbal Smoke, classified under the category to be taxed at 28% GST. The firm sought an advance ruling from the authority and the appellate body, contending that the ingredients used in the smoke sticks are tendu leaves, nutmeg, fennel powder, liquid glucose, propylene glycol, sorbitol, menthol, baking soda, flavouring additive, empty paper tubes, and filter with no tobacco or nicotine.
It submitted that herbal smoke is an ancient practice to address the root cause of diseases, mentioned in ayurveda as dhummapana, a common practice in ayurvedic treatment.
The firm sought a different classification for its product on the grounds that it has healing effects and discourages the habit of smoking. The Gujarat Authority for Advance Ruling, GST, rejected the firm’s application after which it approached the appellate authority.
The appellate authority also rejected the firm’s claim that its smoke sticks are medicinal cigarettes manufactured according to ayurveda. It stated that the firm is “not in a position to pinpoint the authoritative books of ayurveda according to which the goods were manufactured…The appellants do not hold any licence permitting them to manufacture the goods.
They failed in making out a case of their product falling under the category of medicinal cigarettes.”
For coming to this conclusion, the appellate body cited the firm’s communication to the ministry of Ayush, stating that the joint commissioner of FDCA (ayurveda) refused to grant them an ayurveda licence, stating the product does not fall under any category of ayurveda books.
The appellate body also rejected the firm’s contention that the product discourages the habit of smoking. It said that the firm admitted that the product is a substitute for cigarettes and is also manufactured and marketed with the said aim in mind. This belies the fact that the product is intended to assist smokers in quitting smoking.
The firm argued that its herbal smoke helps cure cough, cold, bronchitis and asthma in the way dhummapana is recognised as an approved method in ayurveda by the Ayush ministry and the National Institute of Ayurveda. However, the appellate authority did not accept this claim in the absence of a licence for manufacturing ayurvedic medicine from a regulatory body.