The Tamil Nadu Authority of Advance Ruling (AAR) has ruled that fly ash bricks are not eligible for any exemption or reduced GST rate.
The bench of C. Thiyagarajan and B. Suseel Kumar has observed that the HSN code for Fly ash bricks is 6815 99 10 and the supplier of fly ash bricks has to pay the tax liability as per S. No. 176B of Schedule II to the Notification No. 1/2017 – Central Tax (Rate) dated 28.06.2017. The overall applicable rate of GST is 12% (CGST 6% + SGST 6%) with the availment of ITC. The applicant can pay 6% GST (CGST 3% + SGST 3%) concessional rate without availment of ITC, abiding by the conditions prescribed in Notification 2/2022-Central Tax (Rate) dated 31.03.2022, as amended.
The bench stated that the manufacturer of fly ash bricks can claim ITC on the purchase of raw materials such as fly ash, clay and other materials used to produce these bricks, if they are otherwise eligible. The applicant needs to pay overall GST@ 12% (CGST 6% + SGST 6%) when such ITC is availed.
The AAR also clarified that the sale of fly ash bricks used in construction projects, including residential and commercial buildings are subject to GST under normal taxation system or forward charge and not under reverse charge. The supplier of the fly ash bricks needs to pay GST. The applicant is not eligible for Composition scheme as a manufacturer of Fly ash bricks.
Background
The applicant, M/s. SRS Industries is engaged in the manufacture of ‘Fly Ash Bricks, Cement Bricks.
The Applicant has stated their buyers have informed that as per Hon’ble High Court’s Order, rate of GST on Fly Ash Bricks is 5%. From the copy submitted by the applicant, it is seen that the High Court of Gujarat, vide its Order dated 25.09.2024 in respect of M/s. Shree Mahalaxmi Cement Products, passed judgement that fly ash bricks and fly ash blocks are liable to levy of 5% GST as per Notification No. 24/2018– Central Tax (Rate) dated
31.12.2018. Therefore, the applicant wants a ruling to be issued clarifying classification and rate of GST on fly ash bricks.
On interpretation of law, the applicant stated that as per their view, the rate of tax on Fly Ash Bricks should be 5% as per the High Court’s Order.
Conclusion
The AAR held that Fly Ash Bricks do not figure in the said list of exempted goods and thus are not covered under exempted supplies. Fly ash bricks manufactured and supplied by the applicant attract 12% GST.
Ruling Details
Applicant’s Name: M/s. SRS Industries
Ruling Date: 01/09/2025
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