Exemption to poultry and related services - egg hatching etc

[MURALIKRISHNA BODDAPATI]

Opinion is sought from learned forum members about the exemption to poultry activity under the negative list vide Sec 65B(3). Here Agriculture is defined to mean the cultivation of plants and rearing of all life forms of animals, except rearing of horses, for food, fibre, fule, raw material or other similar products.In addition, the Educational Guidance Note of CBEC has expressed a view that activities like breeding of fish ( pisciculture), rearing of silk worms ( sericulture), cultivation of ornamental flowers ( fliriculture) and horticulture, forestry are included in the definition of agriculture. Hence in the context of Service Tax, agricultural produce includes ' vegetable produe' as well as 'non agricultural produce' .

Hence it follows by principles of natural justice that hatching of eggs produced by hens into day old chicks which is the central activity in poultry breeding shall qualify for exemption under the negative list. I request the considered views of learned Tax Advocates and Chartered Accountants on this issue.

AI Summary

Debate on Service Tax Exemption for Egg Hatching under Section 65B(3) of the Finance Act, 1994. A forum discussion sought opinions on whether poultry activities, specifically egg hatching, qualify for service tax exemption under the negative list in Section 65B(3) of the Finance Act, 1994. The original query suggested that poultry breeding should be exempt as it falls under agriculture, which includes rearing animals for food. However, responses highlighted that poultry is not explicitly mentioned in the negative list or the mega exemption notification, meaning it is not exempt from service tax. Participants agreed that a specific entry is necessary to claim such exemptions, and the educational guide lacks statutory authority.