18% GST applicable on Leased Premises for Cold Storage purpose of Agriculture Produce on Leasing Charges

The Authority of Advance Ruling has held a Goods and services tax rate of 18% is applicable on leasing charges on premises leased for cold storage of agricultural produce. The applicant, a business providing services of storage and warehousing for agricultural produce, sought an advance ruling to understand the tax implications on leasing charges for using leased premises for cold storage of agricultural produce.

Additionally, the applicant wanted clarifications on what the tax implications are on cold storage leased on rent for storage with or without preservation and maintenance to a private enterprise and lastly, what tax implications are on seeds/agricultural produce for storage or warehousing on behalf of farmers and traders.

The AAR held that a Goods and Services Tax rate of 18% is applicable on leased premises for cold storage of agricultural produce on leasing charges. It was also ruled that 18% GST applies to cold storage leased on rent for storage with or without preservation and maintenance to a private enterprise.