Vat applicable on semi stitched fabric for dress in gujarat

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This query is : Resolved

Darshan Shah (Querist)

19 December 2014 VAT is leviable on Semi Stitched fabric (stitched from one side of fabric only and rest three sides ate unstitched) for lady dress. This fabric is into pieces.

Only one side of fabric (i.e. from neck side) is stitched and rest of all sides are unstitched which need to stitch if person needs to wear it.

As per VAT schedule in Gujarat, fabric is non VATable where only ready garments are VATable. Is this fabric is considered into ready made goods?

Please share act clause or Case study if any available.

Darshan Shah

Darshan Shah (Querist)

19 December 2014

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

02 August 2025 Hey! About VAT on **semi-stitched fabric for dresses** in Gujarat:

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### Key points:

* **Semi-stitched fabric** means only one side (like the neck area) is stitched, and the rest is unstitched, so the buyer still needs to do tailoring.
* As per Gujarat VAT rules, **ready-made garments are taxable**, but **raw fabric or unstitched fabric is generally exempt** or non-VATable.
* The question: Does semi-stitched fabric qualify as a “ready-made garment” or just fabric?

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### What usually applies:

* Semi-stitched fabric is typically **not considered a ready-made garment** because it requires further tailoring to become wearable clothes.
* Since it’s not fully stitched or a complete garment, it would likely be treated as **fabric** rather than a “ready-made garment.”
* Therefore, **VAT should not apply on semi-stitched fabric**; only fully stitched, ready-to-wear garments attract VAT.

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### Legal references & cases (Gujarat):

* The **Gujarat VAT Act Schedule** lists “fabric” separately from “ready-made garments.”
* Fabric (including unstitched or semi-stitched) is usually exempt or taxed at 0%, while ready-made garments are taxed at standard VAT rates.
* No direct case law is very popular on semi-stitched specifically, but tax departments generally follow the principle that if the product requires further tailoring, it’s fabric, not a garment.

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### What to do:

* To be sure, you could refer to the **Gujarat VAT Act, Schedule of Goods**, and check definitions for “fabric” and “ready-made garments.”
* You can also request an **advance ruling from the VAT department** for clarity.
* Check if there are any **notifications or circulars** clarifying this (some states issue clarifications on such items).

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If you want, I can help dig into Gujarat VAT schedules or draft a query for advance ruling! Would that help?

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