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2019 (3) TMI 918 - AAAR - GSTTaxability - activities of cleaning of the various Agriculture produce like Saunf (Fennel), Dhaniya (Coriander), Jeera (Cumin seeds), etc. or the like goods which are brought to them by the farmers or by the traders - whether the activity of cleaning of the above produce is exempted under the Entry S. No. 24 (i)(i)(c) and 24(i)(iii) of Notification No. 11/2017-Central tax (Rate) dated 28/06/2017 and Entry S. No. 54(c) and 55 of Notification No 12/2017-Central Tax (Rate) dated 28/6/17? - challenge to AAR decision. Held that:- There are three ingredients of the Entry No. 24(i)(i)(c)and 54( c) ibid: (i) Stated processes should be carried out an agricultural farm; (ii) Stated processes should be of such nature which does not alter the essential characteristics of the agricultural produce; (iii) Stated processes should be of such nature which make the produce marketable for the primary market - A process must satisfy all the three conditions before being declared as the process exempted from GST vide the above said entries Nos. 24(i)(i)(c) and 54(c) ibid under the above notifications Nos. 11/2017-Central Tax (Rate) and 12/2017-Central Tax (Rate). Coming to the first condition, we find that the impugned process is not being carried out at an Agricultural Farm. It is being carried out mechanically in the Factory away from the Agricultural Farm - Coming to the second condition, we find that the process of cleaning does not alter the essential characteristics of the agricultural produce - Coming to the third condition, we find that the process of cleaning undertaken at the end of the appellant make the produces like Saunf (Fennel),Dhaniya (Coriander), Jeera (Cumin seeds) marketable for the secondary market. After this cleaning these produces comes to the stage where these can be directly consumed by the general public. While Saunf (Fennel), Dhaniya (Coriander), Jeera (Cumin seeds) which farmer brings into the primary market is not suitable for direct consumption by the general public - the impugned process succeeds only on one count while it failed miserably on other two counts. By no stretch of imagination activity of mechanized cleaning falls under intermediate production process as job work in relation to cultivation of plants. Intermediate production process as job work in relation to cultivation of plants are operations like harvesting, threshing, plant protection, testing, and supply of farm labour etc., carried out at agricultural farm. The activity of the Appellant i.e. M/s. Rara Udhyog, Jaipur is not covered under Notification No. 11/2017-Central tax (Rate) dated 28/06/2017 and Notification No. 12/2017-Central Tax (Rate) dated 28/6/17 - Ruling of the AAR is upheld.
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