Case Law Details
In re Kakkirala Ramesh (GST AAR Tealangana)
Appellant has sought an advance ruling on whether the Godown Rent collected from the Cotton Corporation of India (CCI) is exempted as per the Notification 21/2019 – Central Tax (Rate) (NN. 21/2019) dated September 30, 2019 read with the Circular No.16/16/2017-GST dated November 15, 2017.
The Honorable Telangana State Authority of Advance Ruling (“AAR”) noted that the CCI has purchased raw cotton from farmers in the primary market and then processed it in ginning mills on a job work basis. CCI has paid tax on ginning and pressing to the ginning mills as it cannot claim exemption under Entry 24 of the modified Notification No. 11/2017 – Central Tax (Rate) dated October 13, 2017 (NN 11/2017). This processing is not meant for the primary market and hence It cannot be treated as raw cotton. Therefore it cannot be claimed that the cotton stored by CCI in the warehouses of the applicant falls under Entry 24B of NN 21/2019.
“The warehousing services rendered by the applicant to CCI do not fall under Entry 24B NN 21/2019 and hence are taxable at the rate of 9% under CGST and SGST each,” the AAR said.
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