TMI Blog2021 (1) TMI 335X X X X Extracts X X X X X X X X Extracts X X X X ..... uce stored in a warehouse may be imported or Exported produced - As per the Entry No. 54 (h) of Notification No. 12/2017-CT (Rate) dated 28.06.2017 as amended Services by way of fumigation in a warehouse of agriculture produce are not liable to Goods and Service Tax. It means that service of fumigation provided to agriculture produces stored in a warehouse are exempted from payment of GST. The term primary market is not defined in the GST Act. It is understood in common parlance as a platform or a place, like a mandi, where the farmers are directly selling to the buyers, including the wholesalers, mills, food processing units, exporters, etc. It appears that services relating to the cultivation of plants include support services as may be required till the farmer disposes the agricultural produce in the primary market. All services and processes beyond the realm of the primary market are excluded. In the custom bonded warehouse agri produce stored for export do not cover under the definition given under explanation 2(d) of Notification No. 12/2017-CT (Rate) dated 28.06.2017. Further, in absence of any facts on the records it cannot be concluded that the custom bonded wareho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to GST @18%. 4. The applicant submitted that their main issue is that Fumigation Services provided to a warehouse of Agricultural Produce is totally exempt under Entry No. 54 of Not. No. 12/2017-CT (Rate) dated 28.06.2017. 5. The applicant submitted that they have order from their client to Fumigation Services in a bonded/ customs warehouse of Food Grain, Pulses and similar to the agri products- whether such fumigation services are chargeable under GST or exempt. 6. The applicant submitted that they sought clarification about the taxability or exempt of such fumigation services provided in a warehouse of Agriculture Produce. Whether such Agri produce stored in a warehouse may be imported or Exported produced. 7. Accordingly, the applicant sought the Advance Ruling on the following questions : 1. Fumigation service provided in a warehouse of agriculture produce is taxable or Exempt vide Entry No. 54 of Not. No. 12/2017-CT (Rate) dated 28.06.2017? 2. Classification of Fumigation of such services under Service Accounting code 998531 is correct. 3. Determination of Tax liability to pay tax on such service. Applicant s interpretation of law and/or facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bonded/ customs warehouse of Food Grain, Pulses and similar to the agri products and such Agri produce stored in a warehouse may be imported or Exported produced. 14. To decide whether the fumigation services provided to the bonded custom warehouse wherein imported or exported agri produce stored are eligible for exemption, we refer the entry No. 54 of Notification No. 12/2017-CT (Rate) dated 28.06.2017. The relevant Entry No. 54 of Notification No. 12/2017-CT (Rate) dated 28.06.2017 as amended vide Notification No. 02/2018-CT (Rate) dated 25.01.2018 is reproduced as under: 4 Heading 9986 Services relating to 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 or agricultural produce by way of- (a) agricultural operations directly related to production of any agricultural produce including cultivation, harvesting, threshing, plant protection or testing; (b) supply of farm labour; (c) processes carried out at an agricultural farm including tending, pruning, cutting, harvesting, drying, cleaning, tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessing done should be such as is usually done by a cultivator or producer which should only help it to attain marketability at primary market. The said definition limits the scope of processing and allows only those activities which help the produces to attain the condition of its first marketability in primary market. After it attains the condition of first marketability the definition restricts all other further processes on the produce for further sale to be termed as Agricultural Produce . Once the products attains its first marketability for the primary market all other subsequent processes on produce leading to value addition and subsequent sale belong to the realm of secondary market thereon refraining the produce to fall under the category of Agricultural Produce as defined in Notification. 14.2 The term primary market is not defined in the GST Act. It is understood in common parlance as a platform or a place, like a mandi, where the farmers are directly selling to the buyers, including the wholesalers, mills, food processing units, exporters, etc . It appears that services relating to the cultivation of plants include support services as may be required til ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Sl. No. 54(h) of the Exemption Notification No. 12/2017-CT (Rate) dated 28.06.2017, therefore, applicant service is liable to GST. 17. The applicant service of fumigation/pest control in Custom Bonded warehouse is liable to GST. Therefore, to determine the classification of the applicant service we refer the explanatory notes of classification Service Code SAC. The relevant entry of said explanatory Notes is as under : 99853 Cleaning services 998531 Disinfecting and exterminating services This service code includes disinfecting dwellings and other buildings; disinfecting vehicles, e.g., buses, trains, boats, planes; exterminating insects, rodents and other pests; fumigation services and pest control services. This service code does not include: - pest (including rabbit) control services in connection with agriculture, cf. 998611 - timber impregnation services, cf. 998831 - cleaning of agricultural premises (hen houses, piggeries, etc.) cf. 998612 17.1 Further, we refer the relevant entry No. 420 of Annexure to the Notification No. 11/2017-CT (Rate) dated 28.06.2017 of SAC 99853 and same is produced as under : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pply of this service indicates that it is inclusive of charges of accommodation and transportation required for such a tour and the amount charged in the bill is the gross amount charged for such a tour including the charges of accommodation and transportation required for such a tour. (ii) Support services other than (i) above 9 - 18.1 In view of the entry No 23(ii) of Notification No. 11/2017-CT (Rate) dated 28.06.2017 the rate of GST for the service of fumigation/pest control provided in a warehouse of agriculture produce would be 18 % i.e. {CGST 9% +SGST 9%}. 19. In the light of the above, we rule as under : RULING 1. Fumigation services provided in a warehouse of agriculture produce is taxable or Exempt vide Entry No. 54 of Not. No. 12/2017-CT (Rate) dated 28.06.2017? Ans . Fumigation services provided in a warehouse of agriculture produce is taxable in view of the above discussion. 2. Classification of Fumigation of such services under Service Accounting code 998531 is correct. Ans . Classification of Fumigation of such services Serv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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