Page 89 - GSTL_13th August 2020_Vol 39_Part 2

2020 ] IN RE : DECCAN TOBACCO COMPANY 175
ous orders passed by the field formations were set aside by Hon’ble Tribunal
vide Final Order dated 22-2-2017 [2017 (6) G.S.T.L. 94 (Tri. - Hyd.)] clearly hold-
ing that the tobacco leaves either before the threshing and redrying and thereaf-
ter and whether before 1-7-2012 or after 1-7-2012 from which date negative list of
services was introduced remain to be Tobacco leaves only and the services were
not taxable. The Special Leave Petition filed by the revenue was dismissed by
Hon’ble Supreme Court vide its order dated 16-7-2018 [2018 (16) G.S.T.L. J76
(S.C.).
Further, the applicant mentions the earlier Ruling No. AAR/AP/17
(GST)/2018, dated 10-10-2018 [2018 (19) G.S.T.L. 327 (A.A.R. - G.S.T.) passed by
this Hon’ble Advance Ruling Authority, A.P., in the case of application filed by
M/s. Pragathi Enterprises, which has given a ruling that the rate of GST applicable
for tobacco supplied at all the below mentioned stages shall be 5% only.
(i) Tobacco leaves procured at tobacco leaves platforms directly or
from farmers;
(ii) On tobacco leaves purchased from other dealers who has in turn
purchased from farmers for the purpose of trading;
(iii) When tobacco leaves are graded basing on their color, wddth etc
and when such graded leaves are sold;
(iv) On tobacco leaves butted and sold to other dealers;
(v) On tobacco leaves re-dried without threshing.
In view of all the above, the applicant is of the view that the following commodi-
ties that the applicant deals with, will fall under the head ‘Tobacco Leaves’ only
and the applicable rate is 5% only :
(a) Tobacco leaves in Cured form procured from farmers directly in
case of Non-FCV tobacco and at Tobacco Auction Platforms in case
of FCV tobacco.
(b) Tobacco leaves traded between dealers of tobacco without render-
ing any further processes, whatsoever.
(c) Tobacco leaves that are subjected to minimum manual process like
grading, butting or redrying, where no physical or chemical chang-
es are happening to the leaves.
(d) Tobacco leaves that are threshed and redried, where only the tobac-
co leaves are as such but are in broken form.
6. Record of personal hearing :
Sri Y. Srinivasa Reddy the authorized representative of the Applicant
Company appeared for personal hearing on 23-10-2019 and they reiterated the
submission already made in the application.
7. Discussion and findings :
We have examined the issues raised in the application. The taxability,
classification, applicable rate of tax, for the goods supplied as governed under
the provisions of respective GST Acts are examined. The applicant is engaged in
the following activities :
(a) Purchase of the cured tobacco leaves brought by tobacco farmers at
the Tobacco Auction Platforms in case of FCV variety or directly
from farmers in case of Non-FCV variety of tobacco and selling
them to other dealers or exporters or manufacturers of tobacco.
GST LAW TIMES  13th August 2020  89