GST on trading of Guar Seeds

[Rajesh Kumar]

Sir / Madam

Guar Seed is an agricultural produce. I want to know that

1. Is it rightly classifiable under HSN 07133910 ?

2. What is the GST rate on sale of Guar Seeds and at what stage I.e. to be paid by farmer or on onward supply by trader?

thanks and regards

[KASTURI SETHI]

Answer to Q.Ni. is YES. See Para No.12 of the decision of AAR reported as 2020 (10) TMI 812 - AUTHORITY FOR ADVANCE RULINGS, KARNATAKA Karnataka State Co-op. AND Para No. 13 of 2006 AGRI TRADE INDIA SERVICES PVT. LTD. Versus UNION OF INDIA 2006 (8) TMI 370 - DELHI HIGH COURT

[KASTURI SETHI]

Dear Rajesh Kumar Ji,

Rate of tax is 5% (2.5 % + 2.5%). You have mentioned that it is an agricultural produce. What is the basis of your view ?

[YAGAY andSUN]

https://economictimes.indiatimes.com/news/economy/agriculture/tax-on-agriculture-gst-applicable-on-seeds-used-in-agriculture-say-two-tax-rulings/articleshow/89689809.cms

[KASTURI SETHI]

M/s.Yagay and Sun,

Sir, I am really very thankful to you for posting weblink

[KASTURI SETHI]

Seeds are not agricultural produce.

2018 (10) TMI 1869 - AUTHORITY FOR ADVANCE RULING, HARYANA - IN RE : ACSEN HYVEG PVT. LTD.

AI Summary

GST classification of seeds: guar seeds attract the seed GST rate; classification and agricultural-produce status remains disputed. Guar seeds are treated as taxable goods rather than tax-exempt agricultural produce for GST purposes. Classification under the commodity heading is supported by prior rulings cited, and practice applies a combined central and state GST levy on seed supplies. However, rulings and commentary diverge, with some authorities holding seeds are not agricultural produce, creating uncertainty on whether farmers or onward traders bear the tax incidence and on applicable compliance treatment.