9911796707
TMI BlogWheat crushing services provided to State Government eligible for exemption if ‘value of goods’ < 25% of value of supplyX X X X Extracts X X X X X X X X Extracts X X X X ..... Wheat crushing services provided to State Government eligible for exemption if ‘value of goods’ < 25% of value of supply X X X X Extracts X X X X X X X X Extracts X X X X ..... a composite supply and the principal supply is crushing service. The service are provided to state government under Public distribution and since the value of goods involved in such composite supply does not exceed 25% of the value of supply thus, the Applicant is eligible for exemption under Sl. No. 3A of Notification No. 12/2017-Central Tax (Rate) dated June 28, 2017 ("the service rate exemptio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n notification"). Facts: M/s. Aryan Flour Mills Private Limited ("the Applicant") is a floor miller, engaged in providing services of wheat crushing. As per the contract between the Applicant and the West Bengal State Government dated September 06, 2017 the Applicant will be provided with the wheat which is owned by the State Government, for conversion into fortified atta for distribution to pub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lic through Public Distribution System (PDS). The Applicant thereafter is required to pack the crushed stock of whole wheat atta, which is later delivered to the Distributors for further distribution to the consumers. The Applicant contended that the process of crushing does not amount to supply of goods rather it is a process carried out which is supply of services and addition of nutrients to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the atta cannot be considered as a separate/ distinct supply of goods since, it is an integral part of the process of such conversion. The Applicant has sought an advance whether it is eligible for exemption and if not what will be the value of supply and rate of tax applicable on supply of service. Issue: Whether the Applicant is eligible for exemption provided under Sl. No. 3A of the service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate exemption notification. Held: The AAR, West Bengal, in IN RE: M/S. ARYAN FLOUR MILLS PRIVATE LIMITED - 2023 (9) TMI 120 - AUTHORITY FOR ADVANCE RULING, WEST BENGAL held as under: * Observed that, the crushing of wheat and addition of nutrients to atta is a composite supply of service. * Noted that, in light of Circular No. 153/09/2021-GST dated June 17, 2021, the service provided by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Applicant is in relation to any function entrusted to a Panchayat under article 243G of the Constitution. Further noted that, as per Circular No. 153/09/2021- GST dated June 17, 2021 entry No. 3A only apply to composite supply of milling of wheat and fortification thereof if the value of goods supplied in such composite supply does not exceed 25% of the value of composite supply. * In respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of valuation, the Authority relied upon the Judgement of AAAR, Andhra Pradesh IN RE : SRI KANAKADURGA RICE AND FLOUR MILL - 2020 (11) TMI 72 - THE APPELLATE AUTHORITY UNDER GST, ANDHRA PRADESH wherein it was held that, the value of by-products so retained by the Appellant shall be included as part of value of supply and also to be termed as a bona fide form of consideration. * Opined that, valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of supply shall be the consideration in money and also include all the components towards non-cash consideration. * Noted that, the value of goods involved in the present case is within the limit specified in Sl. No. 3A of the service rate exemption notification. * Held that, the Applicant is eligible for exemption under Sl. No. 3A of the service exemption notification. (Author can be reach ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed at [email protected]) X X X X Extracts X X X X X X X X Extracts X X X X
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