No GST payable on services by transporting “eggs” by rail from one place to another: AAR


The Karnataka Advance Ruling Authority (AAR) has ruled that no GST is payable on services by way of transporting “eggs” by rail from one place to another.

The applicant, SAS Cargo, is engaged in a freight services business and holds space / container rental rights in Indian Railways. They carry shipments all over India using the leased spaces of Indian Railways. The applicant declares that the goods transported by them are mainly agricultural products which are exempt from trade taxes and their service invoice issued for the same is excluding GST considering the notification 12/2017 of June 28, 2017. Although the notification specifies the exemption on rail transportation services on agricultural products from the GST, but it does not clearly state whether an egg is an agricultural product.

The applicant requested the advance ruling on whether eggs or hatcheries are classified as agricultural products / products and yet another question concerned the applicability of the GST on rail transport services to eggs / hatcheries in under the GST Act.

Eggs, including hatching eggs, are obtained by directly raising chickens (poultry farming). They are either intended for food or as a raw material (hatching eggs) for further propagation and according to the definition of agricultural products, “any product resulting from the breeding of all forms of animal life, for the food, fiber, fuel, raw material or other similar products, on which either no further processing is carried out, or processing as usually carried out by a grower or producer which does not alter its characteristics essential but makes it marketable for the primary market. Thus, fresh eggs in the shell on which no further processing is carried out are covered by the definition of “agricultural product.” There is no condition in the definition that this must be done by a certain type of person to qualify for the definition.

The coram of MPRavi Prasad and T. Kiran Reddy has decided that eggs on which no further processing is carried out are covered by the definition of “agricultural products” in accordance with clause 2 (d) of Notification No. 12/2017 Central tax (rate), June 28, 2017.

“Egg transport services by rail from one place in India to another place in India are exempt according to serial number 20 of Central Tax (Rate) Notification No. 12/2017 dated June 28, 2017 “said the AAR. .

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