The applicant, M/s. Gubba Cold Storage Private Limited is dealing in services that are in the nature of storage and warehousing of agricultural produce, food grains including pulses and rice, etc. They are renting or leasing of agro machinery or vacant land with or without a structure incidental to its use, in relation to agricultural produce. They are using leased premises for storage of agricultural produce which is exempted from GST and the lessor is insisting to pay GST on lease charges and the lessee is denied to pay GST on lease charges where the lessee is using the premises for storage of agricultural products only.
The applicant sought the ruling on the issues that what are tax implications in GST regime using leased premises for cold storage purpose of agriculture produce on leasing charges; what are tax implications in GST regime on cold storage leased on rent for storage with or without preservation and maintenance to Private Enterprises and what are tax implications in GST regime on seeds/agricultural produce for storage or warehousing on behalf of farmers and traders.
The authority consists of Additional Commissioner of State Tax J. Laxminarayana and Joint Commissioner of Central Tax B. Raghukiran ruled that 18% of Goods and Service Tax is applicable on leased premises for Cold Storage purpose of agriculture produces on Leasing Charges.
The authority further ruled that 18% of GST is applicable to cold storage leased on rent for storage with or without preservation and maintenance to Private Enterprises.
The authority observed that GST is exempted if the supply of service is for storage or warehousing of ‘agriculture produce’ as defined in clause 2(d) of Not. No. 12/2017-CT (R) dated June 28, 2017, as amended.Subscribe Taxscan AdFree to view the Judgment