In re Olam Agri India Private Limited (GST AAR Andhra Pradesh)
The Authority for Advance Ruling (AAR), Andhra Pradesh, delivered its order in the case of M/s Olam Agri India Private Limited, filed under Section 97 of the Central Goods and Services Tax Act, 2017 and the Andhra Pradesh Goods and Services Tax Act, 2017. The applicant, registered under the APGST Act, sought an advance ruling on the applicability of GST on the export and supply of pre-packaged and labelled rice in packages up to 25 kilograms.
Background and Facts of the Case
M/s Olam Agri India Pvt. Ltd. is engaged in the business of supplying rice to both domestic and foreign customers. The rice is sold in pre-packaged and labelled bags having quantities of up to 25 kilograms. The outward supply is generally zero-rated under Section 16 of the Integrated Goods and Services Tax (IGST) Act, as the sales are primarily for export or to merchant exporters.
The company’s mode of operation includes multiple supply arrangements:
Direct Export to Foreign Buyers:
1. The foreign buyer specifies the printing and labeling requirements for rice packages.
2. The applicant procures empty printed/labelled bags from a supplier, packs rice in them, and exports directly to the foreign buyer.
Supply to Exporters on “Bill to Ship to” Basis (Shipment to Customs Port):
1. The exporter arranges the supply of printed/labelled empty bags through a packaging supplier, billed to the exporter but shipped to the applicant.
2. The applicant fills the rice and dispatches the pre-packaged goods to the customs port, from where the exporter exports them to the foreign buyer.
Supply to Exporters for Further Export (Shipment to Exporter’s Factory):
1. Similar to the previous arrangement, the packaging supplier ships empty labelled bags to the applicant on the exporter’s direction.
2. The applicant fills and sends the rice to the exporter’s factory, from where the exporter carries out the export.
Procurement at Concessional Rate for Export:
