Note : Under Section. 100(1) of the Uttarakhand Goods and Services Tax Act, 2017, an appeal against this ruling lies before the appellate authority for advance ruling constituted under section- 99 of the Uttarakhand Goods and Services Tax Act, 2017, within a period of 30 days from the date of service of this order.

1. This is an application under Sub-Section (1) of Section 97 of the CGST /SGST Act, 2017 (herein after to be referred as “Act”) and the rules made thereunder filed by M/s. Sam Overseas, 32, VIM Square, Rudrapur seeking an advance ruling on the question of classification and rate of GST on various receipts received by the applicant on the count of distribution of electricity.

2. Advance Ruling under GST means a decision provided by the authority or the appellate authority to an applicant on matters or on questions specified in sub section (2) of section 97 or sub section (1) of section 100 in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.

3. As per the said subsection (2) of Section 97 of the Act ibid advance ruling can be sought by an applicant in respect of.

(a) Classification of any goods or services or both

(b) Applicability of a notification issued under the provisions of this Act,

(c) Determination of time and value of supply of goods or services or both,

(d) Admissibility of input tax credit of tax paid or deemed to have been paid

(e) Determination of the liability to pay tax on any goods or services or both

(f) Whether the applicant is required to be registered

(g) Whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both within the meaning of that term

4. In the present case applicant has sought advance ruling on classification and applicability of GST rate on the ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’. Therefore, in terms of said Section 97(2)(a) & (e) of CGST/SGST Act, 2017, the present application is hereby admitted.

5. The Joint Commissioner (Executive), SGST, Rudrapur Division, in concurrence with the report from Deputy Commissioner, SGST, Khand-l, Rudrapur, vide his letter dated 04.10.2018 submitted the report, in this regard, as under:

1. On point no. 1, the question raised by the applicant in his application is neither already pending nor has the same been determined in any proceedings in party’s other matters under the provisions of this Act.

2. On point no. 2, there is no entry with the name of “Rejected Seed’ in Uttarakhand Goods and Service Tax Act’ 2017. There is a description of ‘All goods other than seed quality” at Sl. No. 63 of its Schedule-I, supply of which, attracts tax at the rate of 5%. Thus, the tax appears to be leviable at the rate of 5% on supply of ‘Rejected Seed’ in question.

6. Accordingly opportunity of personal hearing was granted to the applicant on 30.10.2018. Shri Sanjay Gupta, Partner appeared for personal hearing on the said date and submitted documents describing therein exact nature of work being undertaken. Mrs. Preeti Manral, Deputy Commissioner, SGST-Dehradun appointed as concerned officer by the competent authority of State GST was also present during the hearing proceedings.

7. In the present application, applicant has requested for advance ruling on leviability of GST on supply of ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’. On this issue we have different views and are discussed as under:

(a) [Ruling per: Vipin Chandra, Member] – After having gone through the issue, I am of the considered opinion that the Wheat Seed’ and ‘Paddy Seed’ rejected as seed, does not remain seed anymore. Further ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’ can not be termed as cereals either as during the process, it has to under go the chemical treatment, therefore does not remain fit for human consumption as well. I have observed that there is no entry in the name of ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’ in the GST tariff, however, there is a description of ‘All goods other than seed quality’ at SI. No. 63 in Schedule-I of the said Tariff. Accordingly, tax is leviable at the rate of 5% on supply of these ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’. The details is as under –

(b) [Ruling per: Amit Gupta, Member] – Respectfully, I have gone through the views expressed by Hon’ble Member, Shri Vipin Chandra. I differ with the views of other Ld. Member and as regard to leviability of GST on supply of ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’ as per the application filed by the applicant, my answer is in negative. To appreciate the law position in this regard, the relevant portion of the Act is reproduced as under:

(i). As per “Introduction to GST Tariff” Customs Tariff is adopted for classification of the goods that are not classified anywhere in GST tariff. To avoid classification disputes, notifications issued by Government indicate that Customs Tariff has been adopted for descriptive classification. of goods under GST. The Section Notes, Chapter Notes and Rules of interpretation of Customs Tariff have also been adopted.

In this regard, the relevant portion of HS Code 1001 and 1006 of Chapter 10 (Cereals) of the Customs Tariff is reproduced as under –

On going through the relevant HS code of the Customs Tariff, I observe that the ‘seed of Wheat and Meslin’ has been given under HS Code 10011100 and 10019100 and also, under HS Code 10061010, Rice in the husk (paddy or rough) of ‘seed quality’ has been given, however, it is nowhere mentioned in said HS code whether it covers either the rejected’ or the non-rejected Wheat Seed’ and ‘Paddy Seed’. Hence, in general, the HS Code 1001 and 1006 under the Customs Tariff covers all the Wheat Seed’ and ‘Paddy Seed’ irrespective of the fact whether it is rejected or non-rejected.

The relevant portion of the Chapter 10 of the GST tariff is reproduced as under –

In view of the above, I observe that the ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’ is classified under HS Code 1001 and 1006 of the Customs Tariff and, as per chapter note of GST tariff, the tax is leviable at the ‘Nil’ rate on supply of the ‘Rejected Wheat Seed’ and ‘Rejected Paddy Seed’ in question.

RULING

In view of the above, as regards to classification and leviability of GST on supply of Rejected Wheat Seed’ and ‘Rejected Paddy Seed’, we have different views as discussed supra, We are, therefore, making a reference to the Appellate Authority for hearing and decision on said issue in terms of Section 98(5) of the Act ibid which provide that where the members of the Authority differ on any question on which the advance ruling is sought, they shall state the point or points on which they differ and make a reference to the Appellate Authority for hearing and decision on such question.