Imitation Zari Thread Made From Plastic/Polyester Film With Aluminium Metal Attracts 5% GST, Post Rate-Rationalization

The Gujarat Authority for Advance Ruling (AAR) has held that supply of imitation zari thread or yarn made from metallised polyester or plastic film, widely used in sarees or garments in place of real gold or silver zari thread would attract GST at 5%. In a ruling dated November 29, 2025 Gujarat AAR comprising Shri. Vishal Malani (Memmer- Central Tax) and Smt. Sushma Vora (Member- State Tax) perused the decision of the 52nd GST Council Meeting regarding imitation zari thread or yarn made from metallised polyester film /plastic film, relevant tariff entry HSN 5605, Sl. No. 218AA inserted vide Notification No. 09/2023 dated July 26, 2023. Therefore, the Members concluded that metallic zari thread or yarn made from metallized polyester/plastic film would merit classification under HSN 56050020 attracting 5% GST, aligning with GST Council clarifications and notifications. Applicant sought clarification on GST rate applicable on supply of imitation zari thread/yarn made from lacquered coated polyester/plastic film with aluminium metal. The AAR noted various types of 'Zari' which are marketed including Real zari made from gold/silver, Imitation zari made from aluminium, copper, or other economical metals, Metallic zari made from slitted polyester metallised film. It was also noted that due to the rising cost of thin sheets of pure gold and silver zari manufacturers were inclined to use a 'malleable, durable, ductile' metal like lightweight metallic zari/plastic zari. Thus, Imitation zari in various forms substituted Real zari for use in sarees and dress materials. As for classification, the AAR clarified that insertion of Serial No. 218AA which stipulated a 5% GST and provided for a consolidated entry for metallised yarn including Real and Imitation zari under Schedule instead of the earlier 12% GST under the Serial No. 137 having description “Metallised yarn, whether or not gimped, being textile yarn, or strip or the like of heading 5404 or 5405, combined with metal in the form of thread, strip or powder or covered with metal; such as Real zari thread (gold) and silver thread, combined with textile thread), Imitation zari thread The 52nd GST Council decision to rationalize the rate of Imitation zari thread, as notified, effectively excluded 'Real zari combined with textile thread' and 'Imitation zari threads' from Serial No. 137 by way of a new entry at Serial No. 218AA. Further, Circular No. 205/17/2023-GST dated October 31, 2023 too clarified that imitation zari thread made from metallised polyester/plastic film falls under HSN 5605, taxable @ 5%. This is also reflected in HSN-wise GST rate chart notified vide Notification 9/2025-CT(R) (17.09.2025 effective September 22, 2025, stated the AAR. Case Detail: Sri Ram Jari Industries For Applicant: CA Anish Goyal and Mr. Amit Kapadia Click here to read the AAR order.

Imitation Zari Thread Made From Plastic/Polyester Film With Aluminium Metal Attracts 5% GST, Post Rate-Rationalization

Parul Bose

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