GST Classification and ITC Eligibility on Plastic Toys: Gujarat AAAR Upholds Earlier Ruling, Rejects Appeal:

GST Classification and ITC Eligibility on Plastic Toys: Gujarat AAAR Upholds Earlier Ruling, Rejects Appeal The present advance ruling (No. GUJ/GAAAR/APPEAL/2025/13) dated July 31, 2025, has been filed by a company named M/s. I-Tech Plast India Private Limited (Applicant) under Section 100 of the CGST Act, 2017 and the GGST Act, 2017, against the Advance Ruling No. GUJ/GAAR/R/2024/O4 dated 03.02.2024. The company has a registered address at Survey No. 108-109, Bhavnagar-Rajkot Highway, Shampara, Bhavnagar.

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Questions Asked by Appellant: The appellant, M/s. I-Tech Plast India Private Limited has asked the following questions, seeking the Gujarat Advance Ruling No. GUJ/GAAAR/APPEAL/2025/13, dated July 31, 2025: "Question 1: What is the appropriate classification & rate of GST applicable on the supply of plastic toys under CGST & SGST? Question 2: Can the applicant claim ITC in relation to CGST-IGST separately in debit notes issued by the supplier in the current financial year, i.e., 2020-21, towards the transactions for the period 2018-19?" What Did Ruling Say? In accordance with the Gujarat Appellate Authority for Advance Ruling Goods and Services Tax D/5, Rajya Kar Bhavan, Ashram Road, Ahmedabad – 380009, the following answers have been given to the above questions: Answer 1: The product ‘Plastic Toys’ is made and sold by M/s. I-tech Plast India Pvt. Ltd., located at Survey No. 108-109, Bhavnagar-Rajkot Highway, Shampara, Bhavnagar, is classified under the relevant category as per the Customs Tariff Act, 1975, and the GST rate is applied according to Notification No. 01/2017-Central Tax (Rate) dated 28.06.2017, along with any updates. The details are given in the table below.

Sr. No.	Name of the Product	Customs Tariff Code (as per First Schedule to the Customs Tariff Act, 1975)	GST Rate
1	Plastic toys	95030030	12% (6% SGST + 6% CGST)

Answer 2: No, the applicant cannot claim Input Tax Credit (ITC) in relation to CGST-IGST separately in debit notes issued by the supplier in the current financial year, i.e., 2020-21, towards the transactions for the period 2018-19, for the reasons as discussed above.

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Citing a previous decision of the Hon'ble Supreme Court, the Gujarat Appellate Authority for Advance Ruling ruled that none of the cases mentioned by the applicant deal with the interpretation of Section 104 of the CGST Act, 2017. However, in this case, we have already found that important facts were not disclosed to the Advance Ruling Authority. Because of this, the Advance Ruling given earlier (GAAR Order No. GUJIGAAR/R/10/2021 dated 20.01.2021) is considered invalid under Section 104 of the CGST Act, 2017. On the basis of the above filings, the Gujarat Appellate Authority for Advance Ruling rejected the appeal filed by M/s. I-Tech Plast India Private Limited (Applicant) against the Advance Ruling No. GUJIGAAR/R/2024/04 dated 03.02.2024, issued by the Gujarat Authority for Advance Ruling.