In re Seetharamnjaneya Dal and Fried Gram Mill (GST AAR Andhra Pradesh)
AAR held that GST not applicable on supply of 1 kg packing red gram dall secondary packing in 50 kg bag to the AP State Civil Supplies Corporation Limited, Vijayawada as per the design and label given by the corporation with a prior agreement.
In the instant case, the applicant is supplying red gram dall to the corporation in 1 kg packaging and secondary packaging in 50 kg bag. It is also contended by the applicant that AP State Civil Supplies Corporation Limited being an institution which supplies essential commodities under public distribution system, the above supply is not an ‘Institutional supply’ and is not exempted by rule 3(B).
The questions whether the primary pack of less than 25 Kgs, but are secondary packed in a pack above 25 kgs are covered by Legal Metlorgy Act or Not? Or whether the supply to AP Civil supplies is Institutional supply or Not are to be decided in the backdrop of the provision of Legal Metrology Act, but not under GST.
Be that it may, the first and foremost condition of taxability is that the commodity should have been a pre-packed commodity which means that the commodity is not packed for any specific known buyer. In the Instance case the applicant is packing the commodity at the behest and at the specific instructions of the buyer, ie., AP State Civil Supplies Corporation Limited. It is clearly evident from the package that the AP State civil have made very clear instruction as to the color, theme, transparency and the details to be printed on the package. Thus the commodity is packed for retail sale for any buyer who may purchase at a later point, but it is packaged to a specific buyer. Thus the first and foremost condition of taxability is not satisfied. Hence there is no question of taxability of the commodity in the instant case. In view of this the discussion as primary / secondary packaging or Institutional supply is nothing but infructuous.
FULL TEXT OF THE ORDER OF AUTHORITY OF ADVANCE RULING, ANDHRA PRADESH
(Under sub-section (4) of Section 98 of Central Goods and Services Tax Act, 2017 and sub-section (4) of Section 98 of Andhra Pradesh Goods and Services Tax Act, 2017)
1. At the outset we would like to make it clear that the provisions of CGST Act, 2017 and SGST Act, 2017 are in parimateria and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the APGST Act.
2. The present application has been filed u/s 97 of the Central Goods & Services Tax Act, 2017 and AP Goods & Services Tax Act, 2017 (hereinafter referred to CGST Act and APGST Act respectively) by M/s. Seetharamnjaneya Dal and Fried Gram Mill (hereinafter referred to as applicant), registered under the AP Goods & Services Tax Act, 2017.
3. Brief Facts of the case:
3.1 M/s Seetharamnjaneya dal and fried gram mill (hereinafter referred to as “applicant”) is engaged in the business pulses and dalls. Applicant has facility in his mill to convert pulses into dalls. Applicant is having GST Registration number 37ABBFS5544B1ZD.
3.2 The applicant submits that ‘The Andhra Pradesh State Civil Supplies Corporation Limited’, Vijayawada is a state government undertaking engaged in the business of supplying essential commodities to the fair price shops for public distribution.
3.3 The corporation invited tenders for supply of 25,000 MTs red gram dall,(Fatka) variety in 1 kg packet form with secondary packaging in 50 kg PP bags to all the MLS points of APSCSCL in (13) districts across the Andhra Pradesh State for distribution under PDS and various schemes through AP e-procurement auction platform.
3.4 The applicant is a successful bidder and supplying the red gram dall to the corporation adhering to the guidelines issued by the corporation regarding packing and printing of label on the packing,which are given as under:
(a) The successful bidder has to supply the allotted quantity with good quality of red gram dall to the designated MLS points of APSCSCL.
(b) The successful bidder should supply the stock of redgram dall as per the terms and conditions.It has to be packed in 70 to 75 microns laminated film with reverse printed multi colour film material. The approximate size of pouch may be 7 inches X 9 inches. The supplier shall pack 50 packets of such one Kilogram red gram dal in new 50 Kg HDPE woven sack bag duly machine stitched. The text of the matter to be printed on the one Kg pouch shall be provided by the APSCSCL. The woven sack bag shall have the following matter printed in black colour.
