A registered rice miller dealer under APGST Act,2017 filed a petition in the Andhra Pradesh High Court, which has revoked the assessment order for imposing GST on the value of broken rice, bran, and husk collected by the petitioner on milling of the paddy.
Justice U. Durga Prasad Rao and Justice K.Suresh Reddy allowed the writ petition.
The assessment order was rejected by the High Court of Andhra Pradesh under Article 226 of the Indian Constitution.
The state obtains paddy from the ryots and gives it to the rice mills for milling and giving the respondent authority for distribution.
The respondent authority, in quid pro quo, pays at the rate of 15% per single quintal of the paddy milled.
As per the agreement, irrespective of the yield, the Rice Millers have to supply rice equal to 67% of the paddy delivered for milling.
The actual yield is around 61% to 62% and the remaining balance has to be provided by the petitioner to the respondent authority from his stock.
Therefore, as compensation, the respondent enables the petitioner to keep the broken rice, bran, and husk obtained during milling, which the petitioner sells it.
However, he pays tax on bran at a 5% rate.