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TMI Blog2021 (4) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... and (vii) performance. In the instant case the letter of FCI quoted supra contains all the ingredients required for a contract and hence the said letter is nothing but contractual agreement between the applicant and FCI for the applicant to be acting as pure agent of FCI, for the purpose of supervision of handling and transportation of agriculture produce. Further the applicant procures the services of H T contractors for and on behalf of the FCI and charges actuals separately in the invoice along with their supervisory charges, separately. Thus the applicant squarely qualifies to be a pure agent of FCI in the instant case. The applicant indubitably is pure agent of the recipient FCI. The applicant is involved in provision of services to supervise handling and transportation of agriculture produce, belonging to the FCI, from railhead to warehousing station and hence procures the services from H T contractors for the said purpose. Now we proceed to examine the classification of the supply of the said services of the applicant - the Explanatory Notes to the Scheme of Classification of Services stipulates that SAC 999799 includes Other services n.e.c . In the instant case, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ides the services, in relation to facilitation of handling transport, loading unloading of agricultural produce through Handling Transport (H T) contractors to the depositors (Government/ quasi-government/public sector companies/private companies) who use the services of the applicant, for storing of agricultural produce, such as Food Corporation of India, and collects supervisory charges from its depositors an amount equivalent to the actuals charged by the said H T contractors plus 8% on the said charges towards the said service. 4. In view of the above, the applicant sought advance ruling, on classification of their services mentioned supra, in respect of the following question: Whether 'supervisory charges' under clause 28(b) of the Office order on charges of KSWC charged to Food Corporation of India (FCI) by the Corporation towards supervision of loading, transportation and unloading of agricultural produce like Rice, wheat etc., at the rate of 8% on the amount billed by 'Handling and Transportation' Contractors is chargeable to tax under the CGST/ KSGST Acts, 2017, If yes, at what is the applicable rate of tax and the HSN/ SAC code applicable ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17- Central Tax (Rate) dated 28.06.2017 has notified that the Support services to agriculture, forestry, fishing, animal husbandry are exempt vide entry No24(i)(e), from the levy of tax under the provision of Central Goods and Service Tax Act, 2017 (herein after referred to as CGST/ KGST Act, 2017). 7.2 Storage and Warehousing Services primarily include arrangement for space to keep the goods, loading, unloading and stacking of goods in the storage area, keeps inventory of goods, makes security arrangements and provide insurance cove etc. The same has been explained by CBEC in F.No.B11/1/2002-TRU, dated 01-08-20002, wherein it has been clarified that Storage and Warehousing Service for all kinds of goods are provided by public warehouses, private warehouses, by agencies such as the Central Ware Housing Corporation, Airport Authorities, Railways, Inland Container Depots, Container Freight Stations, storage godown and tankers operated by private individuals etc.. The storage and warehousing service provider normally make arrangement for space to keep the goods, loading, unloading and stacking of goods in the storage area, keeps inventory of goods, makes security arrangements an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the actual charges plus 8% of the said charges (supervision charges) for having supervised the said H T work. The instant application is with regard to taxability of the said Supervisory Charges . 9.4 The applicant submitted that the H T work includes handling of stock at the railhead, transportation to the warehouses, unloading and proper stacking inside the godowns, re-bagging, salvaging, standardization as may be necessary and de-stacking and loading the same at the time of delivery. 9.5 The applicant contends that supervisory charges would fall under the heading 998619 Other support services to agriculture, hunting, forestry and fishing or under the SAC 996799 Other supporting transport services n.e.c or under the SAC 999799 Other services n.e.c and accordingly would be liable to tax at the rate of 9% CGST 9% KGST or at 18% IGST respectively. 9.6 It is observed from the records that the applicant is providing Handling Transportation services of agricultural produce, for which they appoint H T contractors, by online tender through E-procurement and enters into agreement with the said contractors. The applicant procures the services from the H T contractors t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and conditions for performance including fulfilling promises and (vii) performance. In the instant case the letter of FCI quoted supra contains all the ingredients required for a contract and hence the said letter is nothing but contractual agreement between the applicant and FCI for the applicant to be acting as pure agent of FCI, for the purpose of supervision of handling and transportation of agriculture produce. Further the applicant procures the services of H T contractors for and on behalf of the FCI and charges actuals separately in the invoice along with their supervisory charges, separately. Thus the applicant squarely qualifies to be a pure agent of FCI in the instant case. 9.8 In view of the above the applicant indubitably is pure agent of the recipient FCI. The applicant is involved in provision of services to supervise handling and transportation of agriculture produce, belonging to the FCI, from railhead to warehousing station and hence procures the services from H T contractors for the said purpose. Now we proceed to examine the classification of the supply of the said services of the applicant. The Explanatory Notes to the Scheme of Classification of Servi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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