Disagreement on GST for Tobacco Sales by Agent under Rs. 20 Lakhs - Appeal Pending

The Authority for Advance Ruling did not reach a consensus on the applicability of GST on the sale of tobacco leaves by a commission agent with turnover below Rs. 20 Lakhs. The issue was referred to the Appellate Authority for further consideration, and no ruling was issued on the matter.

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Issues Involved:
1. Applicability of GST on sale of tobacco leaves received from farmers by a commission agent with turnover less than Rs. 20 Lakh.
2. Responsibility for paying GST if applicable.
3. Applicability of reverse charge provisions on tobacco leaves.
4. GST liability and collection when a commission agent sells tobacco leaves received from a trader.
5. GST liability for a commission agent receiving tobacco from farmers and earning commission less than Rs. 20 Lakh annually.

Issue-wise Analysis:

Issue 1: Applicability of GST on sale of tobacco leaves received from farmers by a commission agent with turnover less than Rs. 20 Lakh.
- State Member's View: GST is not applicable if the aggregate turnover, including the value of tobacco leaves and commission, does not exceed Rs. 20 Lakhs.
- Central Tax Member's View: Commission agents dealing in agricultural produce like tobacco leaves are exempt from GST as per entry No: 24 of Notification No: 11/2017-Central Tax (Rate).

Issue 2: Responsibility for paying GST if applicable.
- State Member's View: Not applicable since GST is not applicable as per Issue 1.
- Central Tax Member's View: Not applicable.

Issue 3: Applicability of reverse charge provisions on tobacco leaves.
- State Member's View: Reverse charge is applicable on tobacco leaves received by a registered person from an agriculturist as per S.No. 3 of Notification 04/2017 - Central Tax (Rate).
- Central Tax Member's View: The reverse charge provision has not been notified yet.

Issue 4: GST liability and collection when a commission agent sells tobacco leaves received from a trader.
- State Member's View: The commission agent must register under the Act, pay GST, and can collect GST from buyers when selling tobacco leaves received from a trader.
- Central Tax Member's View: The activity is exempt from GST as per entry No: 24 of Notification No: 11/2017-Central Tax (Rate).

Issue 5: GST liability for a commission agent receiving tobacco from farmers and earning commission less than Rs. 20 Lakh annually.
- State Member's View: If the aggregate turnover is less than Rs. 20 Lakhs, the commission agent need not register or collect GST. If the turnover exceeds Rs. 20 Lakhs, registration is required, but the commission received from farmers is exempted as per Notification No. 11/2017.
- Central Tax Member's View: The service is exempt from tax, and the commission agent is not liable to collect GST as per entry No: 24 of Notification No: 11/2017-Central Tax (Rate).

Conclusion:
The members of the Authority for Advance Ruling expressed different views and found no consensus on the issues raised by the applicant. Consequently, the application is referred to the Appellate Authority for further action, and no ruling is issued on this application.

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