The Andhra Pradesh Authority for Advance Ruling has held that fish/prawn farming not amount to ‘agriculture’, and no Goods and Services Tax exemption.
The applicant, M/s. Sri Vinayak Hatcheries had executed an agreement with Grobest Feeds Corporation (India) Private Limited for the purpose oftaking a vacant land with a water channel meant for fish/ prawn farming. The applicant approached the Authority seeking an advance ruling on the applicability of GST on renting Land.
The applicant submitted before the Authority that as per SI.No.54 of Notification No. 12/2017 – Central Tax (Rate); under Heading 9986 – Services relating to the rearing of all life forms of animals, by way of renting of vacant land with or without a structure incidental to its use are exempted from GST.
The Authority observed that fish/prawn farming is not covered under services to agriculture as enumerated under sl No. 54 of the notification as there was no basic operation carried out. The Authority further observed that even when the lease agreement is examined, nowhere it is mentioned specifically that the land is leased for any purpose related to agriculture, rearing of animals, fishing etc. The agreement between the lessor and the lessee (applicant) is executed in the lines of commercial renting of any otherland without any reference to the purpose of usage of the land.
The Coram of Mr. D. Ramesh, Member (State Tax) and Mr. RV Pradhamesh Bhanu, Member (Central Tax) has held that the applicant is ineligible for exemption as per Sl. No. of Notification No. 12/2017 Central Tax and taxable at the rate of 185 under Sl No. 16 of HNS code 9972 of Notification No. 11/2017.
Mr. Eswara Manikanta appeared on behalf of the applicant.
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