Circular No. 100/19/2019-GST
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F. No. 354/27/2019-TRU
Government of India
Ministry of Finance
Department of Revenue
Tax Research Unit
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North Block, New Delhi,
Dated the 30
th
April, 2019
To,
The Principal Chief Commissioners/ Chief Commissioners/ Principal Commissioners/
Commissioner of Central Tax (All) /
The Principal Director Generals/ Director Generals (All)
Madam/Sir,
Subject: GST applicability on Seed Certification Tags-reg.
Representations have been received by the Board seeking clarification regarding
applicability of GST on supply of Seed Certification Tags. Reference in this regard has also
been received from the State of Tamil Nadu.
2. The matter has been examined. It is seen that the process of seed testing and
certification followed in the state of Tamil Nadu, as prescribed in the Seeds Act, 1966 and
elaborated in the Manual on Seed Production and Certification, published by Centre for
Indian Knowledge Systems, Chennai, involves the following steps:
a. Application for seed production
b. Registration of sowing report
c. Field inspection
d. Seed processing
e. Seed sample and seed analysis
f. Tagging and sealing
i. Application for seed production
Any person who wants to take up certified seed production should submit a sowing report in
triplicate to the Assistant Director of Seed Certification to register the crop and season with a
registration fee of Rs. 25/- (Rupees twenty-five only) and prescribed certification charges.
The fee is for a single crop variety for an area up to 25 acres and for a single season.
ii. Registration of sowing report
After receiving the application of the sowing report, the Assistant Director of Seed
Certification scrutinizes and registers the seed farm and duly assigns a Seed certification
number for each sowing report.
Circular No. 100/19/2019-GST
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iii. Field inspection
Field inspections to check for the factors that may affect the genetic purity and physical
health of the seeds are conducted by the Seed Certification Officer (SCO) to whom the
specific seed farm has been allocated. Number of field inspections differ from crop to crop.
Generally field inspections are carried out during the following growth stages of the crop.
Pre flowering stage
Flowering stage
Post flowering and Pre harvest stage
Harvest time
iv. Seed processing
Once the seeds are harvested from the seed farm by following the required field standards, it
is taken to the approved seed processing units. Each seed lot should accompany the
processing report and each seed lot in the unit is verified with this report. Processing includes
cleaning, drying, grading, treating and other operations to improve the seed quality. Seed
Certification Officer inspects the processing plant to check the possibility of mechanical
mixtures.
v. Seed sampling and analysis
Seed sample should be sent to the seed testing laboratory for analysis through the Assistant
Director of Seed Certification. The fee of Rs.30/- (Rupees thirty only) for seed analysis
should be paid during the registration of the seed farm. To analyse the genetic purity of the
seed sample, the producer should pay a fee of Rs. 200/- (Rupees two hundred only) to the
Assistant Director of Seed Certification. Seed lots which meet the prescribed seed standards
like purity, free of inert matter, moisture percentage and germination capacity alone will be
allotted the certification label. White colour label for foundation seeds and blue colour label
for certified seeds should be bought from the Assistant Director of Seed Certification by
paying Rs. 3/- and Rs. 2/- respectively.
vi. Tagging and sealing
Approved seed lots should be tagged with certification tag within two months from the date
of the receipt of seed analysis report or within 30 days from the date of genetic purity test
performed. On receipt of the seed tags, it is verified by the Seed Certification Officer. All the
prescribed details are entered in the tag without any omission. The green colour (10 – 15 cm
size) producer tag should also be attached to the seed lot along with the certification tag.
Avoid stitching more than once on the tags. All the tagging operations should be done in the
presence of the Seed Certification Officer. If tagging has not been done within the specific
time limit, confirmation samples can be taken with prior permission from the Assistant
Director of Seed Certification. In such cases the validity of the seed lot will be fixed from the
initial date of seed analysis and tagged. The fee for the delayed tagging is Rs. 50/- (Rupees
fifty only) and seed analysis fee of Rs. 30/- (Rupees thirty only) has to be paid in such cases.
3. Similarly, in the state of Uttarakhand, the process of seed testing and certification as
prescribed in the Seeds Act, 1966 and the rules made thereunder is that a seed producing
company/organization which wants to produce certified seeds applies to the Seed
Certification Agency of the State Government (Uttarakhand State Seed and Organic
Production Certification Agency) for certification of the seeds produced by it in collaboration
Circular No. 100/19/2019-GST
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with seed farmers as certified seeds. The Seed Certification Agency carries out field
inspections of the seed farms at various stages: planting, pre harvest and harvest stage to see
that the seed is being produced as per the prescribed standards. At the harvest stage, Seed
Certification Agency estimates the quantity of seed that will be produced at the seed farm.
Depending on the number of packets into which the seed shall be packed for marketing, the
seed certification agency issues to the seed company signed seed certificates/tags to be
attached to each packet of certified seed. The fee for such testing and certification is charged
at three stages:
(i) At field inspection level: On per hectare basis, (Rs. 300/ha by Uttarakhand State
Seed Certification Agency)
(ii) At the post processing stage at the seed processing plant:inspection and shift
charges
(iii) Issue of seed certificates: After the seed samples pass all the tests, seed
certification agency issues the required number of seed certificates to be
attached to each packet: amount is charged according to number of tags issued
(Rs. 3 to Rs. 8/tag)
4. It may be seen from the above that seed testing and certification is a multi-stage
process, the charges for which are collected from the seed producers at different stages.
Supply of seed tags to the seed producer is nothing but an element of the one integrated
supply of seed testing and certification. All the above charges, including those for issue of
seed certificates/tags by the Seed Certification Agency of Tamil Nadu and Uttarakhand to the
seed producing organization/ companies are collected for the composite supply of seed
testing and certification, which is exempt under Notification No. 12/2017-Central Tax (Rate)
Sl. No. 47 (services by Central/State Governments by way of testing/certification relating to
safety of consumers and public at large, required under any law). This clarification would
apply to supply of seed tags by seed testing and certification agencies of other states also
following similar seed testing and certification procedure.
5. However, the State Governments/Seed Certification Agencies may get the tags used
in seed certification printed from other departments/ manufacturers outside. Supply of seed
tags by the other departments/manufacturers to the State Government/Seed Certification
Agencies is a supply of goods liable to tax. Whether such tags would be classified under
Chapter 49 as tags made of paper or in Textile chapters as tags made of textile would depend
upon the predominant material used in the tags.
6. Difficulty if any, in implementation of this Circular may be brought to notice of the
Board.
Yours Faithfully,
(Shashikant Mehta)
OSD, TRU
Email: shashikant.mehta@gov.in
Tel: 011 2309 5547
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