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TMI Blog2022 (9) TMI 366X X X X Extracts X X X X X X X X Extracts X X X X ..... uel, raw material or other similar products or agricultural produce rather the sole object of the services as it has been claimed by the applicant is to enhance biodiversity and re-establish ecosystem function to protect the islands and the populace from erosion - such supply of services may be treated as environmental protection services under chapter Heading 9994 and shall not get covered under chapter Heading 9986 being Support services to agriculture, forestry, fishing, animal husbandry . Serial number 32 of Notification No.11/2017-Central Tax (Rate) dated 28.06.2017 and corresponding West Bengal Notification No. 1135 F.T dated 28.06.2017, as amended from time to time, specifies that tax shall be levied @ 18% on Sewage and waste collection, treatment and disposal and other environmental protection services . - Case Number WBAAR 08 of 2022 Order number 06/WBAAR/2022-23 - - - Dated:- 18-8-2022 - MR. BRAJESH KUMAR SINGH, AND MR. JOYJIT BANIK, MEMBER Applicant s representative heard : Mr. Rip Das, CA Preamble A person within the ambit of Section 100 (1) of the Central Goods and Services Tax Act, 2017 or West Bengal Goods and Services Tax Act, 2017 (herei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e (a), (b) and (e) of sub-section (2) of section 97 of the GST Act. 1.5 The applicant states that the question raised in the application has neither been decided by nor is pending before any authority under any provision of the GST Act. 1.6 The officer concerned from the Revenue has raised no objection to the admission of the application. 1.7 The application is, therefore, admitted. 2. Submission of the Applicant 2.1 The applicant submits that he is engaged in planting and nurturing of mangrove seeds and seedlings along with fruit trees in marginalized areas for environment protection against the climatic changes. Contracts for carrying out this activity are awarded by the internationally acclaimed environmental organizations. 2.2 The applicant performs this activity under the outsourced arrangements for seeds collection, developing the seeds into seedlings in nurseries, pre-planting activities, planting of seeds, species and seedlings with the objective of protecting the nature and a fight against global warming. 2.3 The applicant claims that while aiming to enhance biodiversity and re-establish ecosystem function to protect the islands and the populace fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... % or more of the fruit trees survive and become a source of sustainable income and livelihood for the farmers. 2.6 Processes involved in executing plantation of mangrove trees, as submitted by the applicant, are as under: (i) The applicant identifies the land for plantation of mangrove trees in the same manner as it is done for plantation of fruit trees. (ii) Thereafter, trenches are dug fortnight in advance on the identified lands to allow sedimentation for planting of the mangrove seeds, propagules and seedlings. (iii) The seeds are then collected from the mud lands or water bodies nearby and planted into the trenches dug by the local people appointed by the applicant. (iv) The planting activity for the mangroves is done during monsoons and in low tide. (v) Post plantations of seeds, local people are engaged to safeguard the fenced area and mangroves are monitored for 3 to 5 years to ensure its survival. 2.7 The applicant submits that the GST Act nowhere defines the term Agricultural Activity though in section 2(7) the term Agriculturist has been defined. So, an analogy has to be drawn from the other Revenue Acts. The term Agricultural Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or human beings and other living creatures. Thus, these fall under operations or results of agriculture . 2.11 The applicant further contends that cultivation of land is predominantly a major activity mentioned in details under the process explained above for both fruit trees and mangrove trees by way of irrigation, fencing, ploughing, digging trenches, etc and the ultimate item being fruits and oxygen in respective cases is an essential item of consumption. 2.12 In the light of aforesaid submission and interpretation of law, the applicant concludes that both the activities carried out by him is covered under the term Agricultural Services as described in Notification No. 11/2017 Central Tax (Rate) being Serial No 24 with Heading 9986 and read as Support Service to agriculture, forestry, etc. having NIL rate of GST. 3. Submission of the Revenue The submission of the officer concerned from the revenue is reproduced herein under: 3.1 The applicant has sought for an advance ruling on HSN code and rate of tax applicable on the supply of cultivation of fruit trees and nurturing of mangrove seeds and seedlings. As per the application, the applicant is eng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e as classified as per serial no.651 in NOTIFICATION No.1135 F.T., the28th.day of June, 2017. Relevant portion is reproduced as under- Chapter / Heading / Sub-heading / Tariff item Description of Goods CGST Rate (%) SGST / UTGST Rate (%) IGST Rate (%) Compensation Cess 999490 Other environmental protection services nowhere else classified 9 9 18 3.5 In the statement containing the applicant s interpretation of law, the applicant has submitted that the instant supply should be classified under chapter sub heading Serial No.24. Heading 9986 read as Support Services to agriculture, forestry etc. having NIL rate of GST. Upon consideration of the nature of business of the applicant and sole objective of the doing business or as contract awarded to the applicant by different organization as per statement submitted in para 12(B), 15 16, the revenue is of the view that the service provided for Other environmental protection services no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter the essential characteristics of agricultural produce but make it only marketable for the primary market; (d) renting or leasing of agro machinery or vacant land with or without a structure incidental to its use; (e) loading, unloading, packing, storage or warehousing of agricultural produce; (f) agricultural extension services; (g) services by any Agricultural Produce Marketing Committee or Board or services provided by a commission agent for sale or purchase of agricultural produce. (ii) Services by way of pre-conditioning, pre-cooling, ripening, waxing, retail packing, labelling of fruits and vegetables which do not change or alter the essential characte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of cultivation naturally have close links. Horticulture is divided into the cultivation of plants for food (pomology and olericulture) and plants for ornament (floriculture and landscape horticulture). Pomology deals with fruit and nut crops. Olericulture deals with herbaceous plants for the kitchen. [Source: Britannica.com] 4.8 The applicant submits that he is engaged in supplying of services for cultivation, planting and nurturing of fruit trees that provides nutritious food to the families and community residing in the nearby planting activities. We are of the view that the applicant, by way of cultivation, planting and nurturing of fruit trees, thus provides support services to agriculture which is directly related to production of agricultural produce. 4.9 We now come to the other activities carried out by the applicant for plantation of mangrove seeds and seedlings in coastal areas. The issue in our hand is to decide whether the aforesaid activities may be treated as support services to agriculture, forestry, fishing, animal husbandry so that such supply of services get covered under serial number 24 of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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