In re Nutan Warehousing Company Private Limited (GST AAR Maharashtra)
M/s Unilever India Exports Limited is procuring tea of various quality in bulk either from public tea auctions or directly from manufacturers of tea and undertaking blending and packing of the same at the said warehouse. After packing, tea is exported to overseas countries.
Applicant is of strong view that the tea, procured in bulk, either from public tea auctions or directly from manufacturers of tea is an agricultural produce as defined in clause 2(d) of the Notification No. 12/2017-CT (Rate) dated 28.6.2017. Further, storage & warehousing of tea post procurement, blending and packing undertaken by M/s Unilever is exempted under E. No. 54(e) of the Notification No. 12/2017-CT (Rate) dated 28.6.2017.
As the applicant had a serious reservation regarding taxability of renting of warehouse as the warehouse is used for warehousing of tea, an agricultural produce. Under this background, the applicant had requested for advance ruling on —
“Whether the supply of warehouse services used for packing & storage of tea, under above mentioned facts & circumstances was/is exempted vide Serial No 54(e) of Notification No. 12/2017-CT (Rate) or otherwise.”
Judgments cited by the jurisdictional office namely Union of India Vs. Belgachit Tea CO and Brook Bond Lipton India Ltd cited supra support the view that ‘Tea’ is a manufactured product and not agricultural produce.
Thus, we find that the goods being stored in the applicant’s godown are not agricultural produce as per definition given in Notification No. 12/2017-CT (Rate) dated 28th June, 2017 and the same is reiterated by Board Circular No. 16/16/2017-GST issued under F No. 354/173/2017-TRU dated 15.11.2017. So the Exemption provided in serial no. 54 to Notification No. 12/2017-CT (Rate) is not applicable to the activity carried by the company?
Also Read AAR Ruling – No GST Exemption on warehouse services used for packing & storage of tea: AAAR
FULL TEXT OF ORDER OF AUTHORITY FOR ADVANCE RULING, MAHARASHTRA IS AS FOLLOWS:-
The present application has been filed under section 97 of the Central Goods and Services Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “CGST Act and MGST Act”] by NUTAN WAREHOUSING COMPANY PRIVATE LIMITED, the applicant, seeking an advance ruling in respect of the following issues.
1. Whether Exemption provided in serial no. 54 to Notification No. 12/2017 – Central Tax (Rate) is applicable to the activity carried by the company ?
At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / MGST Act would be mentioned as being under the “GST Act”.
FACTS AND CONTENTION – AS PER THE APPLICANT
The submissions, as reproduced verbatim, could be seen thus-
STATEMENT OF RELEVANT FACTS HAVING A BEARING ON THE QUESTION(S) ON WHICH ADVANCE RULING IS REQUIRED.
“Our company is in the activity of providing services in the nature of warehousing, wherein we allow to store the material or goods of our client on specific compensation allowed under Bombay Warehousing Act, for which state license is provided to us to carry on the said activity”
STATEMENT CONTAINING APPLICANT’S INTERPRETATION OF LAW AND/OR FACTS, AS THE CASE MAY BE, IN RESPECT OF AFORESAID QUESTION(S) i.e. APPLICANT’S VIEW POINT AND SUBMISSIONS ON ISSUES ON WHICH THE ADVANCE RULING IS SOUGHT) AND AS PER SUBMISSION DT. 10.04.2018
Brief Facts submitted by applicant on 10.04.2018
1. M/s Nutan Warehousing Company Pvt Ltd (hereinafter referred to as applicant) is a company formed for following main objective
a) To carry on the business of warehousing, cold storage and refrigeration in all its branches and activities and sphere.
b) To carry on the business of storage of fertilizers, insecticides, quality seed, agricultural and horticultural equipment, tool and machinery.
c) To carry on the business of quality seeds and develop quality seeds, acquire suitable lands and carry on agriculture.
d) To produce material and fertilisers and insecticides and acquire agency in the above lines and act as commission agents.
e) To act as clearing and godowns for proper and safe storing of valuable agricultural and horticultural produce and to provide goods and services of all kinds in connection therewith.
f) To provide godowns and warehousing facilities for goods of all descriptions of agricultural and allied products.
2. Applicant had been granted license for carrying out business of warehousing under the Bombay Warehousing Act, 1959. Accordingly, Applicant had constructed Warehouse at various places including warehouse at Fursungi, Pune (hereinafter referred to as the said warehouse). The applicant had given on rent the said warehouse to M/s Unilever India Exports Ltd (hereinafter (referred to as Unilever) on specific compensation allowed under Bombay Warehousing Act.
3. M/s Unilever India Exports Limited is procuring tea of various quality in bulk either from public tea auctions or directly from manufacturers of tea and undertaking blending and packing of the same at the said warehouse. After packing, tea is exported to overseas countries.
4. Applicant is of strong view that the tea, procured in bulk, either from public tea auctions or directly from manufacturers of tea is an agricultural produce as defined in clause 2(d) of the Notification No. 12/2017 – Central Tax (Rate)dated 28.6.2017. Further, storage & warehousing of tea post procurement, blending and packing undertaken by M/s Unilever is exempted under E. No. 54(e) of the Notification No. 12/2017 – Central Tax (Rate) dated 28.6.2017.
5. Based on this understanding, applicant had neither taken GST registration nor discharged the GST liability. After, insistence from Applicant’s client. M/s Unilever, applicant had taken registration and regularly discharging GST liability.
6. As the applicant had a serious reservation regarding taxability of renting of warehouse as the warehouse is used for warehousing of tea, an agricultural produce. Under this background, the applicant had requested for advance ruling on —
“Whether the supply of warehouse services used for packing & storage of tea, under above mentioned facts & circumstances was/is exempted vide Serial No 54(e) of Notification No. 12/2017 – Central Tax (Rate) or otherwise.”
7. Admissibility of Application– The application is filed under Rule 97(1) of the Central Goods & Service Tax Act, 2017 (hereinafter referred to as the Act) for seeking advance Ruling on question framed above, under Rule 57(2) (g) of the Act
8. Further, we affirm that neither the question raised had been decided nor the question raised is pending for ascertainment in any proceeding against us under the Act. Hence, we are eligible for seeking advance ruling on the question raised by us.
Merit-
9. Applicant is owner of Warehouse given on rent to M/s Unilever India Exports Ltd on specific compensation allowed under Bombay Warehousing Act. M/s Unilever India Exports Limited (hereinafter referred to as Unilever) is procuring tea in bulk either from public tea auctions or directly from manufacturers of tea and undertaking blending of different quality of tea and packing them. After packing, tea is exported to overseas countries. Applicant claims that the storage and warehousing of tea is exempted vide Serial No 54(e) of Notification No. 12/2017 – Central Tax (Rate). The said entry is reproduced as under
