Fresh, Unprocessed Isabgol Seeds Supplied Through APMC Auctions Exempt From GST: Gujarat AAR

The Gujarat Authority for Advance Ruling (AAR) has held that psyllium seeds (Isabgol) procured through Agricultural Produce Market Committee (APMC) auctions and supplied in their natural, raw and unprocessed form are exempt from GST.

The ruling applies where no drying, freezing, crushing or other processing is carried out.

A coram of CGST Member Vishal Manibhai Nanji and SGST Member Rashmi Vajs ruled in favour of Jigneshkumar Narayandas Patel, proprietor of Akshar Traders.

“The psyllium seeds to be obtained by the applicant through APMC auction mechanism (on which no artificial or intentional drying, no dehydration, no freezing and no processing of any kind is undertaken at any stage by the applicant) which is later on supplied to the processing units, can be considered as 'fresh',” the Authority observed.

The trader proposed to procure psyllium seeds from farmers through APMC auctions in Gujarat. The seeds would then be supplied to units engaged in extracting Isabgol husk.

According to the application, the seeds would be stored in ventilated godowns. They would be supplied in the same condition in which they were procured. No drying, dehydration, freezing, grading, roasting, milling, crushing or chemical treatment would be undertaken.

The applicant sought a ruling on whether psyllium seeds supplied in this manner qualified as fresh plants and parts of plants, including seeds and fruits, under Heading 1211 and were exempt from GST. In the alternative, it contended that the goods should be treated as goods of seed quality and qualify for exemption on that basis.

While examining the tariff classification and the applicable GST notifications, the Authority noted that psyllium seeds fall under the tariff heading covering plants and parts of plants, including seeds and fruit

It also considered a 2021 circular that discusses the distinction between fresh products and products that have been dried or frozen.

The Authority recorded that the seeds would be procured through the APMC auction mechanism in the same condition in which they were brought by farmers. They would thereafter be stored in dry and ventilated godowns. No artificial or intentional drying, dehydration, freezing, or processing would be undertaken before their supply to processing units.

Referring to these facts, the Bench held that the seeds would remain in the same natural form from procurement until supply. They would retain their original characteristics.

“We find that the psyllium seeds to be obtained by the applicant through APMC auction mechanism (on which no artificial or intentional drying, no dehydration, no freezing and no processing of any kind is undertaken at any stage by the applicant) which is later on supplied to the processing units, can be considered as 'fresh',” the Authority held.

The Authority therefore ruled that psyllium seeds supplied in their natural, raw and unprocessed form qualify for exemption under the entry covering fresh plants and parts of plants falling under Heading 1211.

The Bench, however, rejected the alternative claim that the goods should be treated as goods of seed quality for the purpose of exemption.

“Entry No.77 is a general entry covering all goods of seed quality of Chapter 12 whereas Entry No.87 is a specific entry covering products of heading 1211 only and any specific entry would prevail over a general entry and include the Psyllium seeds and apply covered under Entry No.87 of Notification No.10/2025-Central Tax (Rate) dated 17.09.2025 and are liable to NIL GST,” the Authority observed.

It concluded that psyllium seeds supplied in the manner proposed by the trader would be covered by the specific exemption applicable to products falling under Heading 1211. Accordingly, the supplies would attract a nil rate of GST.