🏷️ Realme Mobile Case – GST Implication on Brand Name: A Legal Insight
Published by: 1FinSolutions
Date: June 25, 2025
Category: GST Cases Explained | Brand Name Taxability | AAR Rulings
📌 Introduction
Is your product taxable at a higher rate just because it "appears" to have a brand name? Can GST be imposed based on the brand perception, even if the trademark is not owned or registered?
This was exactly the issue in the case involving Realme Mobile Accessories and AAR Karnataka. Let’s decode this case and understand what it means for businesses dealing in branded or non-branded goods.
⚖️ Case Summary
Applicant: M/s. Realme Mobile Telecommunications (India) Pvt. Ltd.
Authority: Karnataka Authority for Advance Rulings (AAR)
Ruling Date: July 2023
Key Issue: Whether mobile accessories sold without registered brand/trademark attract GST at 18% or 12%
🧾 Background of the Case
Realme sells mobile accessories like chargers, earphones, and cables through various channels. However, they claimed that some of these items were sold without the brand name or logo on the product or packaging.
Realme argued that these goods were "unbranded" and should be taxed at 12% GST, not 18%. They emphasized that the trademark was not displayed on the goods, and therefore, these shouldn’t be treated as branded goods under the GST rate notifications.
❓ Legal Issue Involved
Whether GST rate notification entry for “goods other than those bearing a brand name” apply when the goods do not physically display the trademark but are perceived as branded?
🧑⚖️ Ruling by AAR Karnataka
The AAR disagreed with Realme’s contention.
“Even though the goods do not carry the physical brand name, the trade channels, packaging design, and consumer perception clearly relate the product with the Realme brand.”
Thus, AAR held that:
The goods are deemed branded, even without explicit mention of the brand on the product.
GST at 18% is applicable, as the intent and perception point towards a branded good.
🧠 Analysis and Explanation
Here’s the breakup in simple terms:
🔹 Section Reference:
GST Notification No. 01/2017 – Central Tax (Rate)
HSN classification for accessories: Chapter 85
Definitions of “brand name” from earlier VAT/Central Excise context
🔹 Why This Matters?
Businesses often try to avoid higher GST by removing brand labels from low-value items.
This case highlights that GST authorities will assess brand association beyond just physical packaging.
🔹 Factors Considered by AAR:
Packaging and color scheme matched brand image
Supplied through Realme-authorized channels
Common knowledge associates the product with Realme
Trademark registered, even if not used
🔍 Key Takeaways
| Points | |
|---|---|
| ✅ GST depends on perception and association, not just labels | |
| ⚠️ Simply omitting the logo does not make it "unbranded." | |
| 🧾 GST rate of 18% applies to accessories linked to a known brand | |
| 🏷️ Businesses must maintain proper classification and documentation |
📚 Impact on Industry
This ruling affects
Mobile manufacturers selling accessories separately
White-label sellers using brand associations
Online retailers offering "branded but unpackaged" goods
Any business trying to structure products as unbranded to avail lower GST rates
💡 1FinSolutions Commentary
At 1FinSolutions, we believe in simplifying GST law for taxpayers and professionals. This case sets a strong precedent: what matters is not only what you sell, but how the market perceives it.
Businesses must:
Audit their packaging strategy
Revisit rate applications based on AAR trends
Avoid artificial classification of goods as “unbranded.”
📥 Conclusion
The Realme case serves as a wake-up call to all brands relying on smart tactics to reduce GST liability. Clear documentation, transparent classification, and a realistic legal strategy are essential under India’s GST regime.
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