GST Applicability

[Ethirajan Parthasarathy]

A person has leased out his coffee estate along with standing plants & trees and getting monthly rentals. Is such rental receipts are exempt or to be treated as not a 'supply' or is it taxable under GST Law

[Rajagopalan Ranganathan]

Sir,

In my opinion the coffee estate along with standing plants & tree is leased out for commercial purpose. The lease is for the purpose of carrying out commercial activity of selling the coffee seeds. Therefore it is liable to gst under CGST Act and the respective state acts.

[KASTURI SETHI]

Dear Sir,

It is a composite supply. Seeds are not agricultural produce. Seeds are not in picture here. Can you prove the following aspects :-

1. Standing plants and trees are a major supply.

2. This supply in any form is an agricultural produce.

If you can prove the above facts, then you can explore the possibility of availing exemption. So the admissibility of exemption depends upon the full facts and circumstances which are not present in your very very brief query.

[Kunal Agrawal]

It is a renting service and liable to GST. Supply of agriculture produce itself is exempted and not input services for agricultural produce.

[Ganeshan Kalyani]

I agree with the views of Sri Kasturi Sir. The main supply is leasing of coffee estate. The agricultural produce is not supplied here. So, the standing plants or trees does not make any point. The renting is for a commercial purpose and GST is applicable.

[Rajan Atrawalkar]

The activity is renting / leasing of agricultural land and it will be covered under serial no 54 of Notification 12/2017 (Exemption Notification)

[Shilpi Jain]

More clarity on the terms of the contract would help to ascertain liability. possibility of exemption as discussed by Kasturi sir can also be examined

AI Summary

GST on leasing of agricultural estate: leasing treated as taxable supply unless statutory exemption or factual classification applies. Whether monthly rentals from leasing a coffee estate with standing plants and trees are taxable under GST depends on classification: if the transaction is renting/leasing of immovable property for commercial purposes it is liable to GST; alternatively, if standing plants constitute the dominant supply and the transfer qualifies as agricultural produce or meets conditions of the exemption notification for leasing agricultural land, exemption may apply. Detailed contract terms and factual findings determine the applicable treatment.