GST FOR TEA
GUWAHATI, May 27: The Gauhati High Court has admitted a writ petition that has challenged the Centre’s decision of imposing GST on processed tea.
The Department of Revenue, under the Union Finance Ministry, issued a clarification last year saying that processed tea, including black and white tea, falls outside the definition of agricultural produce given in notifications issued under the Integrated Goods and Services Tax and Union Territories Goods and Services Tax Acts. Therefore, exemption from GST is not available to their loading, packing and warehousing.
Recently, the Guwahati Tea Warehousing Association (GTWA), while challenging the Centre’s decision not to consider processed tea as an agricultural produce, which denies it exemption from Goods and Services Tax (GST), filed a writ petition at the Gauhati High Court. The high court has admitted the writ petition and issued notices to the respondents to furnish their replies by June 20.
The Centre, represented by the Secretary of the Department of Revenue under the Finance Ministry, the Assam Government represented by the Principal Secretary of the Agriculture Department, the Commissioner of GST in Guwahati and the GST Council in New Delhi have been made respondents in the case.
GTWA general secretary Manoj Kumar Surana filed the petition. The petitioner was represented by advocates ML Gope, Nitu Hawelia and others.
“Payment towards GST made by the petitioner’s association in terms of the impugned clarification shall be subject to the outcome of this writ petition,” the high court said in its interim order.
The GTWA in its petition has contended in the court that the Supreme Court, in other cases, has considered tea as an “agricultural produce” and thus GST is not applicable to such produce.
The Supreme Court, in an earlier order, had upheld the decision of Allahabad High Court that “processed tea” is an “agricultural produce”.
Under GST, agricultural produce is defined as any produce out of cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fibre, fuel, raw material or other similar products, on which either no further processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market.