2020 (8) TMI 633 - AAR - GST

Classification of goods - rate of tax - agricultural implements namely latex collection cup, made of plastic, used exclusively for collection of rubber latex, an agricultural activity - HELD THAT - This authority has already issued ruling on the issue in IN RE M/S. GEO THOMAS AND COMPANY 2019 (11) TMI 39 - AUTHORITY FOR ADVANCE RULING, KERALA that latex collection cup is exclusively used as an agricultural implement for rubber tapping. The Rubber Board has accepted that plastic latex collection cups are agricultural implements widely being used in rubber plantations for collection of latex directly from the rubber trees. Therefore, it can be safely classified as agricultural implements manually operated used in the rubber plantations for harvesting the rubber latex. Plastic latex collection cup is an agricultural implement exclusively used for rubber tapping and comes under the classification HSN 8201 90 00 other hand tools of the kind used in agriculture, horticulture or forest . As such it is exempted from GST as per Sl No. 137 of Notification No. 02/2017 Central Tax (Rate) dated 28.06.2017.

Summary

Issues: Classification and rate of tax of agricultural implements (latex collection cup) used for rubber tapping.

The judgment by the Authority for Advance Ruling, Kerala, addressed the issue of the classification and tax rate applicable to agricultural implements, specifically plastic latex collection cups used for rubber tapping. The applicant, engaged in manufacturing and supplying these cups for rubber farmers, sought clarification on the tax treatment of these items. The cups are attached to rubber trees for collecting latex and are made from reprocessed plastic lumps. The Rubber Board certified that these cups are essential for rubber latex collection, a crucial agricultural activity.

The Authority, after detailed examination and considering a previous ruling on a similar issue, determined that plastic latex collection cups qualify as agricultural implements under the HSN code 8201 90 00, categorized as "other hand tools used in agriculture, horticulture, or forest." These cups are manually operated and widely used in rubber plantations for latex collection. Although not specifically classified in Chapter 82 of the Customs Tariff, they are deemed to be exempt from GST under Sl No. 137 of Notification No. 02/2017 Central Tax (Rate) dated 28.06.2017. Therefore, the Authority ruled that plastic latex collection cups are indeed agricultural implements exclusively used for rubber tapping and are exempt from GST.

In conclusion, the judgment clarified the classification and tax treatment of plastic latex collection cups used for rubber tapping as agricultural implements falling under the HSN code 8201 90 00. The ruling provided by the Authority for Advance Ruling, Kerala, ensures that these essential tools for rubber farmers remain exempt from GST, recognizing their significance in facilitating agricultural activities like rubber latex collection.