Commission agent, dealing in agriculture produce, shall be in liable for compulsory registration
Subject: Corrigendum to Circular regarding Scope of Principal and agent relationship under Schedule I of HGST Act, 2017 issued vide Endst. No. 3332/GST-2, dated 9th October, 2018.
In para 9 of the Circular issued vide Endst, No. 3332/GST-2, dated 09.08.2018.
” However, in cases where the supply of agriculture produce is not exempted and liable to tax, such commission agent shall be liable for compulsory registration under sub-section (vii) of section 24 of the HGST Act.”
“Further according to clause (vii) of section 24 of the HGST Act, a person is liable for mandatory registration if he makes taxable supply of goods or services or both on behalf of other taxable persons. Accordingly, the requirement of compulsory registration for commission agent, under the said clause shall arise when both the following conditions are satisfied namely:-
(a) the principal should be a taxable persons, and
(b) the supplies made by commission agent should be taxable.
Generally, a commission agent under APMC Act makes supplies on behalf of an agriculture Further, as per provision of clause (b) of sub-section (1) of section 23 of the HGST Act, an agriculturist who supplies produce of cultivation of land is not liable for registration and therefore does not fall within the ambit of the term “taxable person”. Thus a commission agent who is making supplies on behalf of such an agriculturist, who is not a taxable person, is not liable for compulsory registration under clause under clause (vii) of section 24 of the HGST Act, However, where a commission agent is liable to pay tax under reverse charge, such an agent will be required to get registered compulsory under section 24 (iii) of the HGST Act,
2. Difficulty, if any, in implementation of this Circular may please be brought to the notice of the Department.
Amit Kumar Agarwal
Excise & Taxation Commissioner-cum-
Commissioner of State Tax, Haryana
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