In re Arun Cooling Home (GST AAR Tamilnadu)
Whether the service of cold storage of tamarind inner pulp without shell and seeds are exempted under the purview of the definition of Agricultural produce vide Notification No.11/2017 and 12/2017 Central Tax(Rate) both dated 28.06.2017?
The Tamarind inner pulp without shell and seeds is not an ‘Agricultural produce’ as defined under explanation 2(d) of the Notification No. 12/2017- C.T.(Rate) dated 28.06.2017 and therefore the service of cold storage of such tamarind are not exempted under SI.No. 54 (e )of Notification No. 12/2017- C.T.(Rate) dated 28.06.2017 .
Read AAAR Order: Dismissal of Appeal of Arun Cooling Home by AAAR: Time Limitation Grounds
FULL TEXT OF THE ORDER OF AUTHORITY OF ADVANCE RULING, TAMILNADU
Note: Any appeal against the Advance Ruling order shall be filed before the Tamil Nadu State Appellate Authority for Advance Ruling, Chennai under Sub-section (1) of Section 100 of CGST ACT 2017 /TNGST Act 2017 within 30 days from the date on which the ruling sought to be appealed against is communicated.
At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act.
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ARUN COOLING HOME, Natham Main Road, Kadavur Village, Chathrapatti, Madurai-625014 (hereinafter called the ‘Applicant’) is registered under the GST Vide GSTIN 33ABBFA8029R1Z4. The applicant is dealing with the service of cold storage They have sought Advance Ruling on the following question:-
Whether the service of cold storage of tamaring inner pulp without shell and seeds are exempted under the purview of the definition of Agricultural produce vide Notification No.11/2017 and 12/2017 Central Tax(Rate) both dated 28.06.2017.
The Applicant has submitted the copy of application in Form GST ARA – 01 and also submitted a copy of Challan evidencing payment of application fees of Rs.5,000/- each under sub-rule (1) of Rule 104 of CGST rules 2017 and SGST Rules 2017.
2.1 The applicant has stated that their service is covered under Notification No.11/2017-Central Tax(Rate) dated 28.06.2017 under Sl.No.24(e) Loading unloading packing storage or warehousing of agricultural produce (Heading SAC 9986). Entry no.54 of Notification No. 12/2017- C.T.(Rate) dated 28.06.2017 exempts services relating to cultivation of plants and rearing of all life forms of animals except the rearing of horses, for food, fibre, raw material or other similar products or agricultural produce by way of ( e) loading, unloading packing storage or warehousing of agricultural produce.
2.2 On the Interpretation of Law the applicant has stated the term ‘Agricultural Produce’ means any produce out of cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fibre, fuel, raw material or other similar products, on which either no further processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market. They have stated that the tamarind is primarily produced or cultivated by small farmers who remove the shell or the upper part and bring the inner part (which is the consumable part of Tamarind) for sale. The Tamarind may or may not come for storage with seeds. They have submitted that incase of tamarind, the pod is cracked open, string(fibre) is removed and kernel is taken out. Thus, the resultant tamarind comes under definition of agricultural produce. The shelling and removal of seeds to obtain the pulp is usually done by the farmers. Hence, the inner pulp without shell and/or seeds comes under the purview of definition of “Agricultural produce” as it does not lose its essential characteristics. Hence, the applicant has stated that the services of storage or warehousing of such produce is exempted under the Notification No.11/2017-Central Tax(Rate) dated 28.06.2017.
3.1 Due to the prevailing PANDEMIC situation and in order not to delay the proceedings, the applicant was addressed through the Email Address mentioned in the application to seek their willingness to participate in a virtual Personal Hearing in Digital media. The applicant consented and the hearing was held on 10.12.2020. The authorized representative appeared for the hearing virtually. He stated that there is a confusion in the eligibility of the SI.No.54 ofNotification No. 12/2017- C.T.(Rate) dated 28.06.2017 as the ruling of ARA of Andhra Pradesh and Rajasthan are different. The applicant was asked whether the tamarind stored by them is the one stored by farmers. The applicant was asked to furnish the following details:-
i. Copies of the rulings of ARAs relied upon
ii. Copy of invoices raised for the supply
iii. Copy of license held by the applicant to undertake such storage under relevant laws
iv. List of major service receivers/ class of receivers
v. Photograph of raw tamarind freshly cultivated and then stored in their facility.
3.2 . The applicant submitted the following documents vide their letter dated 18.12.2020,-
> Copies of rulings of ARAs of Andhra Pradesh and Rajasthan in the case of M/s. S S S V K Cold Storage Pvt Ltd and Sardar Mal Cold Storage & Ice Factory respectively
> Copies of invoices raised by them(Random)
> Copy of the FSSAI license
> List of major service receivers under the class of receivers-Traders/Farmers with the details of commodity.
> Photograph of freshly cultivated tamarind and tamarind stored in their storage unit alongwith Photographs of removal of seed from shell
> Video CD for process of tamarind
> Affidavit of Shri. K.A.T. Karthikeyan, trader; L.G. Paul Pandian, Trader; M.R.Kannan, Trader A.Mayil Rajan, trader of tamarind
> Oath of Allegiance of Shri R.Sivamurthi;Shri K.Nandakumar, R.Ramar cultivators of tamarind trees in their land
3.3 They had further stated inter-alia, that:-
> The rate of tax for the sale of tamarind is NIL
> Theirs is Pure Service. They are dealing with the service of cold storage of agricultural produce like Apple, dates, potato, chillies and Tamarind
> They are collecting GST & paying GST on the cold storage service on dates
> They are not collecting and not paying tax on tamarind
> They came to know that there are two advance rulings on cold storage service of tamarind:-
