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TMI Blog2019 (10) TMI 1133X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 97 of the KGST Act, 2017, in FORM GST ARA-01, discharging the fee of Rs. 5,000/- each under the CGST Act and the KGST Act. 2. The Applicant is a Limited Company and is registered under the Goods and Services Act, 2017. The applicant has sought advance ruling in respect of the following question:- Whether the "commission earned from auctioning of flowers is covered under entry no. 54(e) & (g) of Notification No.12/2017 - Central Tax (Rate) dated 28.06.2017 and entry no. 54(e) & (g) of Notification (12/2017) FD 48 CSL 2017 dated 29.06.2017? 3. The applicant furnishes the following facts relevant to the stated activity:- a. The applicant states that they are in the business of auctioning flowers and are a commission agent for the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lock runs in the decreasing order and the price per stem reduces from maximum to minimum. The unsold flowers would be reauctioned on the immediately next day after completing the auction of that day's flowers. Even after this, if they are unsold, they would be sent back to the growers with the delivery challan. 4.2 The applicant issues invoice in his name with the details of the lot and the receivables are deducted from that amount The amount due to the growers is distributed at the earliest. The collection of amount from the buyer is also done by the applicant. 5. Regarding the issue before the Authority, the applicant states that as under: 5.1 The activities conducted by the applicant falls within the definition of "Agent" as defined i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of all life forms of animals, except rearing of horses, for food, fiber, fuel, raw materials 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." The cut flowers are in the nature of agricultural produce as it is a produce out of cultivation of plants on which no processing is done. 5.4 A combined reading of the above makes it clear that the services by any APMC or Board or services by a commission agent for sale or purchase of agricultural produce are exempt from levy of GST. The applicant is not an APMC or a Board. However, it falls under the thir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the KGST Act. 6.1 In the subject matter the Office of the Commissioner of Central Tax, Bangalore-North has provided their views in the matter. Letter dated 30.04.2019 and the views expressed by the Assistant Commissioner of Central tax in letter dated 29.04.2019 have been examined. The view expressed by the aforesaid office is that the stated activity is not covered under SI. No. 54(g) of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 and is more appropriately covered under SAC 9961 which relates to services in wholesale trade and includes services of whole sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... key ingredient for determining relationship under GST would be whether the invoice for the further supply of goods on behalf of the principal is being issued by the agent or not. Where the invoice for further supply is being issued by the agent in his name then, any provision of goods from the principal to the agent would fall within the fold of the said entry. However, it may be noted that in cases where the invoice is issued by the agent to the customer in the name of the principal, such agent shall not fall within the ambit of Schedule I of the CGST Act. Similarly, where the goods being procured by the agent on behalf of the principal are invoiced in the name of the agent then further provision of the said goods by the agent to the pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is a commission agent within the meaning of the term and he is providing services for sale or purchase of agricultural produce, the same is covered under clause (g) of entry no.54 of the Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 and hence the services provided by the applicant is exempted from CGST. Similarly, the services are covered under clause (g) of entry no.54 of the Notification (12/2017) No. FD 48 CSL 2017 dated 29.06.2017 and hence are exempted from tax under the Karnataka Goods and Services Tax Act, 2017. 7. In view of the foregoing, we pass the following RULING The commission received by the applicant for facilitating the purchase and sale of cut flowers is covered under clause (g) of the entry 54 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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