In a major development that will impact the expenses of middle class in the summer season, the Gauhati High Court has ruled that the carbonated juices are eligible for 12 percent GST instead of 28 percent, a Times of India report said on Wednesday.

The High Court, in its order said that the carbonated juices are not just ‘carbonated water alone.’ Citing a 2017 notification, the bench of Justice Soumitra Saikia reportedly said that the ready to serve fruit drinks and carbonated fruit drinks attract 12% GST.

The order by the High Court has effectively put an end to the GST demand raised against X’SS Beverage. Though the GST officials had said that the beverages contain carbonated water, hence, they should be put in higher tax bracket. However, X’SS Beverage had insisted that fruit juice was the major ingredient in its products and therefore they should be taxed on a lower rate.

The High Court, while granting the plea, ruled that fruit juice-based drinks should be classified under aerated branded soft drinks. Subsequently, there was no justification for the subordinate authorities to include these products in the Notification under Section 6(1)(d).

Relying on the Rules for Interpretation of the Customs Tariff Act, 1975, the Gauhati High Court emphasised in the situation when the products don’t fit precisely into one category, such products should be classified under the most appropriate to their essential nature. The bench while delivering the GST order also considered the case of Parle Agro’s ‘Appy Fizz.’

Source: Money Control