TMI Blog2019 (3) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 22 of CGST/TNGST Act. Whether separate registration is to be taken from all the states where the offices of RGCA is situated? Explain the procedure to obtain registration? - If registration is required to be made, what are the tax rates applicable to the transactions of RGCA? - Held that:- It is observed that Section 25(1) of the CGST Act, 2017 provides that every person who is liable to be registered under section 22 or section 24 shall apply for registration in every such State or Union territory in which he is so liable. Therefore, registration is required to be taken in the states or union territory from where taxable supplies are made. Since RGCA-Head office is having GST Registration (Migrated from TNVAT) at Tamil Nadu only other various project sites are located at different states but doesn t having the GST registration so far, If they want to purchase materials through interstate from Mumbai to its one of the branch at Kerala, how the purchases of the materials to be made and what are the documents to be carried for the transport of such purchased goods under GST? - Held that:- It is observed that this question is not on any of the specified issues in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ST registration so far, If they want to purchase materials through interstate from Mumbai to its one of the branch at Kerala, how the purchases of the materials to be made and what are the documents to be carried for the transport of such purchased goods under GST? 2. Rajiv Gandhi Centre for Aquaculture (RGCA) was established during 1995-96 as a Society under the Tamil Nadu Societies Registration Act, 1975 by MPEDA (RGCA s parent organisation, which is an autonomous body created by an Act of Parliament during 1972), as its Research Development arm to pioneer and deliver Aquaculture Research Development in India. RGCA is funded by MPEDA, under the Ministry of Commerce Industry through Central Sector Plan Schemes. RGCA, is having its Headquarters established at Sirkali, Nagapattinam District, Tamil Nadu. RGCA is governed by an Executive Committee comprising of members from various Ministries and Departments of both State(s) as well as Central; including from MPEDA, MoC I, ICAR, DBT, MoA, Commissioner of Fisheries from Andhra Pradesh, Tamil Nadu and Gujarat; Director of Fisheries of Kerala, Andhra Pradesh, Tamil Nadu, Andaman Nicobar Islands and U.T of Puducherry and The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral person *(human being) created by law and recognized as a legal entity having distinct identity, legal personality and duties and rights. As RGCA is registered under Tamil nadu Societies Registration Act 1975, it does not fall under Societies Registration Act 1860. AS per Section 2(17) of the Act, the activities of RGCA which are for promoting and developing the aquaculture fall under the definition of business though it is not for pecuniary benefit. The business of RGCA falls under the scope of supply under Section of GST as it is for consideration in the course or furtherance of business. They rear aqua produce (research oriented) and sell fish to develop fishery in India not for profit), fish feed, fish seed and training and research development. They are not agriculturist as per definition under Section 2(7) of CGST as it is not an individual or Hindu Undivided Family. Their supply of fish seed, live fish and aquatic feed is exempted under Sl. No. 18, Sl. no 19 and sly no 102 respectively of Notification 2/2017- Central Tax (Rate) dt 28.06.2017 as amended. 2.3 Activities of RGCA adopted that in turn contribute in preservation of environment of are as follows: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of services imported into India is an inter-state trade or commerce. In this case, the service received from outside India fall are used for research and development and consequential farmer training under the category of agricultural extension services which are exempt. RGCA avails legal services from advocates who appear on behalf of RGCA to courts and tribunals etc., hence they are liable to pay tax on reverse charge basis but as the services rendered by RGCA are not taxable, registration is not mandatory in their case and no tax is payable on reverse charge basis. 3. The Authorized Representative of the Applicant was heard in the matter. The Representative furnished Contracts/ agreements for foreign technical service; MOU with Fisheries Department, Tamil Nadu for setting up of breeding and testing Centre copies of invoices raised; furnished nature of activity, annual report. They have also submitted the details of their activity to the jurisdictional authorities. The details and documents furnished were examined. 3.1 It is seen that the activities of RGCA are: Research and development activities of RGCA are technology development for breeding and farming of new/ a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ., b. 2 or 3 days theoretical trainings for students and academia c. Seminars, workshops, awareness Programs, alternative species farming. RGCA is producing and supplying to the farmers and entrepreneurs the live fish seeds, which is miniature of adult produced in captive condition. They supply seed of fish, prawn, shrimp and crab species for a subsidized price. They also sell freshly harvested fish, shrimp, and crabs from their demonstration farms but not on commercial basis. They supply cysts of Artemia to commercial shrimp /prawn, fish hatcheries for a consideration. The larvae coming out of these cysts are staple food served to shrimp /prawn/ fish/crab larvae in commercial hatcheries. RGCA avail technical services from experts and corporates outside India. The nature of foreign technical services being received by RGCA are as follows:- a) Breeding and seed production technology of new and alternative varieties of aquaculture organism viz., Asian Sea bass, mono sex Scampi, Mud crab, Coble, mono sex GIFT tilapia etc., b) Best farming practices for yield improvement in aquaculture viz., Sea bass cage farming, mono sex GIFT tilapia farmi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e liable to be registered under GST with effect from the appointed day. RGCA have also referred to Sec. 23, which specifies the persons who shall not be liable for registration. They have expressed their view that since their supplies are exempt from tax, they are covered under Sec.23 (1) (a), under which there is no liability for registration. 4.2 To identify this, we must first find the tax rates of the various supplies made by RGCA which has also been sought by RGCA in the advance ruling. 5. The goods being supplied by RGCA are Live seeds of fish, prawn, shrimp and crab species such as Asian Sea bass weaned fry and fingerlings, Mud crab instars, Cobia(marine fish) babies, GIFT tilapia (fish)mono sex babies, which are miniature of adult produced in captive condition. Live fish / shrimp etc. such as Pompano (marine fish), Brood/ parent stock of Litopenaeus vannamei shrimp. Artemia cysts which serve as the main staple food for shrimp, prawn, fish and crab babies in all commercial hatcheries. Explanatory Notes to Chapter 03, General Note state: This Chapter covers all fish and crustaceans, molluscs and other aquatic invertebrates, whether live or dea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic cellular structure of the original vegetable material is no longer recognisable under a microscope. Tariff heading covers products which are obtained by processing animal material to such an extent that they have lost the essential characteristics of original material. However, Artemia cysts are eggs if the brine shrimp from which larvae can be hatched. Hence, the Artemia cysts have not lost their essential characteristics and cannot be classified under tariff hearing 2309. Tariff heading 0511 covers 0511 Animal Products Not Elsewhere Specified or Included; Dead Animals of Chapter 1 Or 3, Unfit For Human Consumption 0511 10 00 - Bovine semen - Other : 0511 91 Products of fish or crustaceans, molluscs or other aquatic invertebrates; dead animals of Chapter 3: 0511 91 10 --- Fish nails 0511 91 20 --- Fish 0511 91 30 --- Other fish waste 0511 91 90 --- Other 0511 99 -- Other: --- Silkworm pupae: 0511 99 11 ---- Artemia 0511 99 19 ---- Other ---- Sinews and tendons: 0511 99 21 ---- Of wild life 0511 99 29 ---- Other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the mission is. To develop, introduce and disseminate world class sustainable technologies in aquaculture . Thus RGCA, mainly, is the R D arm of MPEDA and the mission is to undertake research, give consultancy and technical services to the farmers, entrepreneurs, and scale up the technologies developed, etc. after assuring the commercial viability. Therefore, the activities of RGCA do not constitute as preservation of environment or wildlife but are related to research, consultancy, and technical services to aquaculture. 6.1 Research and development activities of RGCA are technology development for breeding and farming of new/ alternative species with high commercial value Viz. fish, prawn, shrimp, crab etc. They supply to small/ marginal farmers and entrepreneurs for a consideration. SAC 998114 covers Research and experimental development services in agricultural sciences This service code includes basic and applied research services and experimental development services related to agricultural techniques, fruit culture, forestry, stock breeding, fisheries, etc. SAC 9981 Research and development services are taxable at 9% CGST under Sl. no 18 of Notification No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sl no 54 of Notification No 12/2017 dt 28.06.2017 as amended. Explanation 4 to this notification states: (vii) 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. In the present case consultancy services of RGCA are towards nursery technology, cage farming hatching etc. which are support services for rearing of fish, crab, prawn, etc. and are difectly related to operations and hence are exempt from CGST under Sl. No. 54 of Notification No 12/2017 dt 28.06.2017 as amended and exempt from SGST under Sl no 54 of Notification No. II(2)/CTR/532(d-15)/2017 vide G.O. (Ms) No. 73 dated 29.06.2017 as amended 6.3 Testing services supplied by RGCA are through developed state of the art testing laboratories at its headquarters. These are a) Central Aquaculture Pathology Laboratory (CAPL) - In CAPL the tests being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99811 Research and experimental development services in natural sciences and engineering 998111 Research and experimental development services in natural sciences This service code includes basic and applied research services in natural sciences, experimental or theoretical work undertaken primarily to acquire new knowledge of the underlying foundations of phenomena and observable facts, without any particular application of use in view and experimental development services involving systematic work, drawing on knowledge gained from research and practical experience, that is directed iv. in biotechnology related to knowledge requiring one or more of the techniques: DNA/RNA like genomics, pharmacogenomics, gene probes, genetic engineering, DNA/ RNA sequencing/ synthesis/ amplification, gene expression profiling, and the use of antisense technology; proteins and other molecules like sequencing/ synthesis/ engineering of proteins and peptides (including large molecule hormones); proteomics, protein isolation and purification, signaling, identification of cell receptors; The testing of Seed (babies) and adults of diversified aquaculture species viz., fish, prawn, c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l extension service. It is merely imparting skill or knowledge imparted for a consideration. The Explanatory notes explaining the scope of services under the heading 999293 states as follows: 999293 Commercial training and coaching services This service code includes any training or coaching provided by any institute or establishment providing commercial training or coaching for imparting skill or knowledge or lessons on any subject or field other than the sports, with or without issuance of a certificate and includes coaching or tutorial classes. The training activities of RGCA to students, academia who are not directly involved in rearing of fish, aquaculture etc. are covered under SAC 999293 and taxable at 9% CGST under Sl no 30 of Notification No 11/2017 dt 28.06.2017 as amended and 9% SGST under Sl no 30 of Notification No II(2)/CTR/532(d-14)/2017 vide G.O. (Ms) No. 72 dated 29.06.2017 as amended. 7. As stated in Para 5 and 6 supra, it is clear that all the supplies of RGCA are not exempt and some are taxable supplies. RGCA has also stated that their aggregate turnover is above ₹ 20 Lakhs and that they are also receiving consultancy services from abroad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... classifiable under 0301, are exempt from CGST under Sl. No. 18 of Notification No.2/2017-C.T. (Rate) dated 28.06.2017 as amended and from SGST under Sl. No. 18 of Notification No. II(2)/CTR/532(d-5)/2017 vide G.O. (Ms) No. 63 dated 29.06.2017 as amended. b. Live fish supplied by RGCA, classifiable under 0301, are exempt from CGST under SI. No. 19 of Notification No.2/2017-C.T. (Rate) dated 28.06.2017 as amended and from SGST under Sl. No. 19 of Notification No. II(2)/CTR/532(d-5)/2017 vide G.O. (Ms) No. 63 dated 29.06.2017 as amended. c. Artemia cysts supplied by RGCA, classifiable under 0511, are taxable at 2.5% CGST under Sl. No.21 of Notification No.1/2017-C.T. (Rate) dated 28.06.2017 as amended and at 2.5% SGST under Sl. No.21 of Notification No. II(2)/CTR/532(d-4)/2017 vide G.O. (Ms) No. 62 dated 29.06.2017 as amended. d. Research and development activities of RGCA are towards breeding, developing new species, genetic testing of Seed and adults of diversified aquaculture species, Gene sequencing for confirmation of species, under SAC 9981, are taxable at 9% CGST under Sl no 18 of Notification No 11/2017 dt 28.06.2017 as amended and 9% SGST under Sl no 18 of Not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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