Children Scooter, Smart Tricycle etc. fitted with electronic circuit will be taxable at 18% under GST: AAR

Case Details: Authority for Advance Rulings, Tamilnadu Joshna Chandresh Shah, In re - [2021] 133 taxmann.com 307 (AAR - TAMILNADU)

Judiciary and Counsel Details

• • T.G. Venkatesh and Smt. K. Latha, Member

Facts of the Case

The applicant was a dealer of ‘Toys’. The toys dealt with include electronically operated toys as well as manually operated toys in which electronic parts were fitted for providing light, music and horn, etc. It filed an application for advance ruling to determine taxability of toys fitted with electronic circuit.

AAR Held

The Authority for Advance Ruling observed that toys namely Children Scooter, Activity Ride-on, Smart Tricycle and Kick Scooter would contain an electronic circuit for flashing lights, playing music/sound and horn, which would be either powered by the battery housed in the toy or powered by the induction force applied while playing with the toy. In these goods, physical force would be the primary action but they also contain an inbuilt electronic circuit and therefore, these goods would be treated as ‘Electronic Toys’. Thus, as per Sl. No. 440 of Schedule III of Notification No. 1/2017 – Central Tax (Rate), dated 28-6-2017, the applicable GST Rate on Children Scooter, Smart Tricycle etc. fitted with electronic circuit would be 18%.

List of Cases Referred to

• • Indo International Industries v. CST 1981(8) ELT 325 (SC) (para 2.2)
  • Ramavatar Budhaiprasad v. Asstt. STO [1961] 12 STC 286 (SC) (para 2.2)
  • CST v. Jaswant Singh Charan Singh [1967] 19 STC 469 (SC) (para 2.2)
  • CCE v. Connaught Plaza Restaurant (P.) Ltd. [2014] 52 taxmann.com 531 (SC) (para 2.2)
  • Ponds India Ltd. v. Commission of Trade Tax 2009 taxmann.com 934 (SC) (para 2.2)
  • Nandi Marketing v. State of Maharashtra [VAT Appeal No. 661 of 2017] (para 2.2)
  • BPL Ltd. v. State of Andhra Pradesh [Appeal (Civil) Nos. 91444-445 of 2001, dated 9-1-2001] (para 7.4)
  • MSCO. (P.) Ltd. v. Union of India 1984 taxmann.com 491 (SC) (para 7.4).