This circular provides clarification on the applicable GST rate on laterals and parts of sprinkler or drip irrigation systems when such items are supplied separately and not along with the complete system.

It clarifies that sprinklers and drip irrigation systems, including their laterals and parts, are covered under entry at S. No. 195B of Schedule II of Notification No. 1/2017–Central Tax (Rate) and are classifiable under heading 8424. The intent of this entry is to cover laterals and such parts which are suitable for use solely or principally with sprinkler or drip irrigation systems.

Accordingly, laterals and parts which are used solely or principally with sprinkler or drip irrigation systems and are classifiable under heading 8424 shall attract GST at the rate of 12%, even when supplied separately. However, parts of general use which are not classifiable under heading 8424, based on the relevant section notes and chapter notes of the HSN, shall attract GST at the rate applicable to their respective classification.

This clarification aims to resolve classification disputes and ensure uniformity in the levy of GST on irrigation system components.