GST on Renting of Cold Storage

[Praveen Kumar]

Mr A has a Cold storage which he rents out to Mr B.

Mr B provides cold storage services of agriculture produce to Farmers - which is exempt by way of notification 11/2017.

Now, whether the renting of Cold storage by Mr A to Mr B can claim this exemption of notification?

[Shilpi Jain]

There is no exemption for renting of the cold storage.

[Praveen Kumar]

Instead, If Mr A provides entire space/building for storage of Agriculture products to Mr B

Where Mr B inturn stores Agriculture products of farmers in lot basis. In this situation can we call it Storage of Agriculture produce and claim exemption for the transaction between Mr A and Mr B

[KASTURI SETHI]

Dear Querist,

Pl. mention name of agricultural produce so as to enable me to examine the admissibility of exemption from GST.

[KASTURI SETHI]

Dear Querist,

The following decisions of AAR may be helpful to you depending upon the product :-

2018 (18) G.S.T.L. 634 (A.A.R. - GST) =  2018 (10) TMI 1141 - AUTHORITY FOR ADVANCE RULING, RAJASTHAN IN RE : SHUBHLAXMI COLD STORAGE AND ICE FACTORY PRIVATE LIMITED

2018 (13) G.S.T.L. 428 (A.A.R. - GST) = 2018 (6) TMI 459 - AUTHORITY FOR ADVANCE RULING-ANDHRA PRADESH IN RE : S.S.S.V.K. COLD STORAGE PVT. LTD.

[Shilpi Jain]

Yes. Only if storage services are provided the exemption would be applicable. But if the agreement is purely renting of the premises then exemption not applicable. You would have to see the feasibility of converting it into a storage of AP agreement.

[KASTURI SETHI]

Also go through decision of AAR Karnataka reported as 2019(30) GSTL.376 (AAR-GST). Applicant : Karnataka Food and Civil Suppliies Corporation .(Advance Ruling No.112/2019 dated 30.9.2019) = 2019 (10) TMI 799 - AUTHORITY FOR ADVANCE RULING, KARNATAKA

AI Summary

Storage services exemption: renting alone does not qualify, but genuine agricultural storage arrangements may be exempt under GST.
The GST exemption applies to storage services of agricultural produce, not to a pure renting of premises; if the owner provides space and the arrangement constitutes genuine storage services for agricultural produce, the transaction may be assessed as exempt, but the specific product and contractual/factual characterisation determine admissibility, with Advance Rulings cited as guidance.