Haryana AAR: 5% GST Applies on the Supply of Pre-packaged Rice Upto 25 kg

The Haryana AAR (Authority for Advance Ruling) held that exports of pre-packaged rice classified under 25 kg are applicable for GST (Goods and Services Tax).

Moreover, the exporter is responsible for paying GST on the basis of the bill to ship pre-packaged rice categorised for up to 25kg. For example, bill the exporter and ship to the customs port. The rice is ultimately exported by the exporter to international buyers.

The applicant, M/s D D International Pvt. Ltd., is in the business of producing and providing rice. We offer our customers rice in pre-packaged and labelled packages with a maximum weight of 25kg.

According to the proposal, they have information on three different sorts of customers and how sales and supply are made. They are:

• Customers based overseas (foreign buyers)
• Customers based in India who buy rice from us for exports on a bill-to-ship basis (exporter)
• Customers based in India who purchase rice from us and sell overseas (exporters)

Considering the above-mentioned supplies’ GST rates, the applicant has asked for an advance judgement.

Following the officers’ opinions, the judges ruled that pre-packaged and labelled rice purchases up to 25kg are subject to GST at 5% under Notification No. 06/2022, Central Tax (Rate), dated July 13, 2022. It is applicable if both of the following circumstances are true:

It has already been packaged and labelled, and it must include the statements mandated by the Legal Metrology Act, 2009 (1 of 2010), as well as any rules adopted in accordance with it.

Read Also: GST Revised Rates on Jaggery, Sharpener, Pre-packaged Goods

As an outcome of the concerned officer’s comment, the bench of Sunder Lal and Kumud Singh held that GST applies to all supplies of pre-packaged and labelled rice bags made to foreigners.

Additionally, the bench observed that despite the rice being sold for internal use or export, 5% GST will be imposed if it is delivered in pre-packaged and labelled bags with a capacity of up to 25kg.

Name of Applicant	M/s D D International Pvt. Ltd
Advance Ruling No.	HR/HAAR/34/2022-23
Date	9/02/2023
GSTIN	06AABCD0696B1Z2
Haryana AAR	Read Order