Agricultural implements used for Rubber Tapping such as Spouts, Cup Holders and Collection Cups are exempted from GST: AAR [Read Order]

The Authority of Advance Ruling (AAR) in Kerala has ruled that, Agricultural implements used for rubber tapping such as spouts, cup holders and collection cups are exempted from Goods and Services Tax ( GST ).

The applicant is engaged in manufacture and sale of plastic cups which are exclusively used for collection of rubber latex. Spout is a metal piece made of galvanized iron or tin sheet bend all alone into ‘V’ shape. It is driven into the bark of rubber tree, a few inches below the front end of the tapping cut to guide the latex into the collection cup. Cup holders are used to keep the collection cup in place below the spout. It is made up of GI wire and tied on the tree with the help of plastic thread. The applicant is a supplier of latex collection cup, which is made up of plastic. Therefore, it is pointed out that spout, cup holder and latex collection cup are agricultural implements used for rubber tapping and the main implements used in the rubber plantations for harvesting the rubber latex.

While dealing the issue, the authority has noted that, the issue is already dealt in the Ruling No.KERJ54/2019 dated 21.06.2019, that latex collection cup is an agricultural implement exclusively used for rubber tapping. There is no doubt that latex collection cup is an agricultural implement exclusively used for rubber tapping. Hence, this will come under the classification agricultural implements manually operated. Joint Commissioner of Central Tax IRS Sivaprasad. S and Additional Commissioner of State Tax B.S Thyagarajababu observed that, Spout, Cup Holders and Collection Cups are agricultural implements used for rubber tapping and are covered under the description under HSN 8201 90 00 “other hand tools of the kind used in agricultural, horticulture or forest” and are exempt from GST as per Sl No. 137 of Notification No. 02/2017 Central Tax (Rate) dated 28.06.2017.