Paddle Wheel Aerators Used in Aquaculture Fall Under Residual

Paddle Wheel Aerators Used in Aquaculture Fall Under Residual HSN 8479 Taxable at Eighteen Percent

Issue

Whether Paddle Wheel Aerators used exclusively for oxygenation in aquaculture ponds are classifiable as agricultural machinery under HSN 8436 or under the residual category of machines with individual functions under HSN 8479 of the GST Tariff.

Facts

The applicant is a GST-registered manufacturer of Paddle Wheel Aerators and its components, which are used exclusively in aquaculture ponds to maintain oxygen levels.
The manufacturer approached the Authority for Advance Ruling (AAR) to determine if the product falls under HSN 8436 (which covers agricultural/horticultural machinery) or HSN 8479 (covering residual machinery with individual functions).
The applicant argued that their product should be classified under HSN 8436 pursuant to Notification No. 1/2017-Central Tax (Rate), seeking a lower tax rate by linking aquaculture to agricultural operations.
To support this claim, the applicant relied on definition clauses inside Notification No. 12/2017-CTR and a descriptive press release issued by the Ministry of Fisheries.
The dispute covers two distinct tax timelines: the period from July 1, 2017, to September 21, 2025, and the subsequent period starting from September 22, 2025 onwards.

Decision

HSN 8436 is restricted to traditional farming: Tariff entry 8436 strictly covers machinery specific to agriculture, horticulture, forestry, poultry-keeping, or bee-keeping operations.
Aquaculture is distinct from agriculture: The popular and commercial meaning of “agriculture” applies here, which remains distinct from aquaculture or pisciculture (fish farming). Pisciculture cannot be treated as agriculture for tariff classification.
External context and press releases are non-binding: The applicant’s reliance on Notification No. 12/2017-CTR is legally misplaced as those specific definitions apply strictly within their own exemption contexts. Similarly, a Ministry of Fisheries press release holds no authority over statutory tariff classification.
Classification under residual HSN 8479: Since there is no specific or dedicated GST Tariff entry covering Paddle Wheel Aerators used in aquaculture, the product must be classified under the residual Heading 8479.
Final Ruling: The aerators are taxable at 18% under Serial No. 366 of Schedule III to Notification No. 1/2017-CTR up to September 21, 2025, and under Serial No. 464 of Schedule II to Notification No. 9/2025-CTR from September 22, 2025. The case was decided in favor of the revenue.

Key Takeaways

Strict Construction of Tariff Entries: Tax exemption or concessional entries for “agriculture” cannot be loosely stretched to cover allied sectors like aquaculture or fisheries unless the tariff schedule explicitly mirrors that intent.
Context-Specific Definitions: Definitions provided in one tax notification (such as a services exemption notification) cannot be blindly extracted to resolve classification disputes under a separate goods rate notification.
The Rule of Residual Classification: When a highly specialized commercial machine does not fit into any specific, named category of the Customs/GST Tariff, it must legally default to the residual or baseline heading (like HSN 8479) created for miscellaneous mechanical appliances.

AUTHORITY FOR ADVANCE RULING , GUJARAT

Sagar Aqua Culture (P.) Ltd., In re*

SUSHMA VORA and VISHAL MALANI, Member

Advance Ruling No. GUJ/GAAR/R/2026/04
In Application No. Advance Ruling/SGST & CGST/2025/AR/21

FEBRUARY 19, 2026

Meet Parikh and Samir Agicha, CAs for the Applicant.

ORDER

Brief facts:

1. M/s. Sagar Aqua Culture Private Limited, Plot No 1, Survey No 1084, Ardoi – Kotda Sangani Road, Rajkot, Gujarat-360030 [for short – ‘applicant’] is registered under GST and their GSTIN is 24AATCS9859H1ZG.

2. The Applicant is engaged in the business of aquaculture equipment, specifically focusing on the manufacture and sale of Paddle Wheel Aerators. These aerators are critical for maintaining appropriate oxygen levels in aquaculture ponds, an essential aspect of rearing fish, prawns, and shrimp. As per the applicant, the product in question performs a distinct function by increasing dissolved oxygen in water through the movement and circulation of water, thereby improving the health and productivity of aquatic organisms. The usage of the aerators is exclusively for aquaculture/fish farming/ shrimp ponds. The components of the Aerator are Electric motor, Floats (usually HDPE), Gearbox, Paddles and Stainless steel or galvanized metal shafts.

3. The applicant has sought an advance ruling on the following question:-

Whether the product namely “Paddle Wheel Aerators” (including its parts) which are manufactured and/or sold by the applicant and used exclusively in aquaculture operations (such as shrimp and fish farming) are classifiable under:

HSN 8436: “Other agricultural, horticultural, forestry, poultry-keeping or bee-keeping machinery, including germination plant fitted with mechanical or thermal equipment; poultry incubators and brooders” as specified in SI. No. 199 of Schedule II – 6% to Notification No. 1/2017-Central Tax (Rate), as amended from time to time attracting GST at the rate of 12%.

HSN 8479: “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this Chapter.” as specified in SI. No. 366 of Schedule III – 9% to Notification No. 1/2017-Central Tax, as amended from time to time (Rate) attracting GST at the rate of 18%.

4. The applicant’s interpretation of law in respect of the questions on which advance ruling is sought is as under:-

(a)

SI. No. 199 of Schedule II to Notification No. 1/2017-Central Tax (Rate) covers -other agricultural, horticultural, forestry, poultry-keeping or bee-keeping machinery, including germination plant fitted with mechanical or thermal equipment; poultry incubators and brooders; parts thereof of Chaper Heading 8436. The Paddle Wheel Aerators used exclusively in aquaculture (fish/shrimp farming) are akin to agricultural machinery used in farming activities, especially in the context of modern aquaculture being recognized as an extension of agricultural activity.

(b)

The definition of “farmer” as depicted in National Policy for Farmers, 2007 includes fishers also apart from agricultural holders, cultivators, agricultural labourers, sharecroppers, tenants, poultry and livestock rearers, beekeepers, gardeners, pastoralists, non-corporate planters and planting labourers, as well as persons engaged in various farming elated occupations such as sericulture, vermiculture, and agro-forestry.

(c)

Reliance is place on the judgment of the Hon’ble CESTAT, Chennai, wherein the Paddle Wheel Aerators used for fisheries/aquaculture are held to be classifiable under chapter heading 8436 of the CTH.

(d)

The statutory definition of “agricultural produce” as provided under Explanation 2(d) to Notification No. 12/2017-Central Tax (Rate), dated 28.06.2017 as amended from time to time, supports the classification of Paddle Wheel Aerators under HSN 8436. The definition of “agricultural produce” explicitly includes “rearing of all life forms of animals”, with no limitation to terrestrial animals. The use of the words “all life forms of animals” reflects the legislature’s intention to cover the full spectrum of farming activities, including those involving aquatic species, under the umbrella of agriculture.

(e)

Heading 8436 covers: “Other agricultural, horticultural, forestry, poultry-keeping or bee-keeping machinery….”. The term “other” in the description must be interpreted ejusdem generis with the preceding specific terms-i.e., machinery used in biological, rearing, or cultivation-based farming activities.

(f)

Noscitur a sociis-This principle implies that words draw meaning from accompanying words. Therefore, aquaculture equipment should be interpreted in the same category as poultry and beekeeping machinery.

(g)

Heading 8479 is a residual entry covering: “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter.” As established by jurisprudence and classification rules, the residual heading applies only where no other heading captures the product’s function or use. Therefore, invoking Heading 84 79 would be incorrect in law, as it is settled that a specific heading prevails over a general/residual one.

(h)

Therefore, Paddle Wheel Aerators merit classification under HSN 8436, specifically attracting 12% GST under SI. No. 199 of Schedule II to Notification No. 1/2017-Central Tax (Rate), as amended.

5. The applicant has further submitted that the subsequent to the filing of advance ruling application, the Central Government has issued Notification No. 9/2025-CT(R), dtd. 17.09.2025, whereby the rate of tax applicable to goods classifiable under HSN 8436 has been reduced to 5% w.e.f. 22.09.2025.

6. Personal hearing was granted on 06.02.2026 wherein Shri Meet Parikh and Shri Samir Agicha, Chartered Accountants for the applicant and reiterated the facts & grounds as stated in the application. They further submitted that in the Press Release dated 04.09.2025 issued by the Ministry of Fisheries, Animal Husbandry & Dairying it has been mentioned that “Diesel engines, aerators, and sprinklers, essential for aquaculture operations and hatcheries will now attract only 5 % GST instead of the earlier 12 to 18 percent …”. Therefore, the Paddle Wheel Aerators would merit classification under HSN 8436, whose rate of tax has been reduced to 5% w.e.f. 22.09.2025 vide Notification No. 9/2025-CT(R), dtd. 17.09.2025.

Discussion and findings

7. At the outset, we would like to state that the provisions of both the CGST Act and the GGST Act are the same, except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the GGST Act.

8. We have considered the submissions made by the applicant in their application for advance ruling as well as the submissions made both oral and written during the course of personal hearing. We have also considered the issue involved, the relevant facts & the applicant’s submission/interpretation of law in respect of question on which the advance ruling is sought.

9. We find that the short issue to be decided is the classification of ‘Paddle Wheel Aerators’, which are exclusively used in aquaculture/fish farming/ shrimp ponds for maintaining appropriate oxygen levels in aquaculture ponds, an essential aspect of rearing fish, prawns, and shrimp. The applicant’s view is that the Aerators would fall under HSN 8436 under “Other agricultural, horticultural, forestry, poultry-keeping or bee-keeping machinery, including germination plant fitted with mechanical or thermal equipment; poultry incubators and brooders” and not under HSN 8479: “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this Chapter.”

10. The main argument advanced by the applicant for bringing the Aerators under HSN 8436 is that Paddle Wheel Aerators used exclusively in aquaculture (fish/shrimp farming) are akin to agricultural machinery used in farming activities. To arrive at such an interpretation, they have placed reliance on the definition of “farmer” as depicted in National Policy for Farmers, 2007, which includes fishers also. They have also relied upon the judgment of CESTAT Chennai in the case of Suyog Agro Poultry Products (P.) Ltd. v. Commissioner of Customs (Sea Imp.), Chennai (Chennai – CESTAT)/2016 (335) E.L.T. 350 (Tri. – Chennai) which has held that Paddle Wheel Aerators fall under Heading 8436 of the Customs Tariff Act, 1975. Reliance is also placed by them on the definition of ‘Agricultural produce’ mentioned in Notification No. 12/2017-Central Tax (Rate), dated 28.06.2017, which includes “rearing of all life forms of animals”.

11. The reliance on the National Policy for Farmers (2007) definition is misplaced, as it overlooks the policy’s intended breadth. The Preface explicitly states that the framework is “defined holistically and not merely on agriculture,” distinguishing it from a standard Agriculture Policy. By design, the definition encompasses a wide spectrum of activities across multiple sectors, rather than being restricted solely to traditional agriculturalists. We find that the Supreme Court in the case of CIT v. Raja Benoy Kumar Sahas Roy [1957] 32 ITR 466 (SC)/AIR (1957) Supreme Court 768 has held as under:-

Whether the narrower or the wider sense of the term “agriculture” should be adopted in a particular case depends not only upon the provisions of the various statutes in which the same occurs but also upon the facts and circumstances of each case. The definition of the term in one statute does not afford a guide to the construction of the same term in another statute and the sense in which the term has been understood in the several statutes does not necessarily throw any light on the manner in which the term should be understood generally.

Thus, the inclusion of “fishers” within the definition of “farmers” under the National Policy for Farmers (2007) does not mandate the extension of that definition to the classification of agricultural machinery. The definition of the term ‘farmer’ in the National Policy for Farmers, 2007 was crafted specifically to achieve the objectives of that particular policy; as such, it cannot be transposed to define common parlance terms within an entirely different regulatory or technical context.

12. As regards the reliance of the applicant on the order of the Tribunal in the case of Suyog Agro Poultry Products Pvt. Ltd., we find that Tribunal in the case of Suyog Agro Poultry Products Pvt. Ltd. has also relied upon the definition of farmer in the National Policy for Farmers, 2007 to hold that paddle wheel aerators used in aqua farming are agricultural machineries and classifiable under HSN 8436. Therefore, we respectfully do not follow the decision of the Tribunal.

13. We find that the Supreme Court in the case of Maheshwari Fish Seed Farm v. T. Nadu Electricity Board [2004] 4 SCC 705 has dealt with the issue as to whether pisciculture is agriculture. The Supreme court was dealing with the claim made by appellants engaged in fish farming i.e. pisciculture, seeking exemption of electricity charges, which was granted to those involved in agriculture activities, by way of a notification. The claim made by the appellants was that pisciculture is only a specie of agriculture. The Supreme Court found that the Act, either in the main part, or in the Schedule detailing the tariff rates, does not define agriculture. The Supreme Court held that it is a settled rule of interpretation that the words not defined in a statute are to be understood in their natural, ordinary or popular sense. The Supreme Court, further, held as under:-

The relevant entry in the Act as its historical background show was intended to provide electricity at concessional rates or free of any charge to the farmers by dividing them into classes such as small farmers and others farmers. A farmer would be an agriculturist in the traditional sense and narrow meaning of the term. A person engaged in aquaculture or fish farming would not be called a farmer. Neither the legislature while enacting the schedule to the Act as it originally stood nor the State Government issuing the notification amending the schedule can be attributed with the intention that they had intended to make available electricity at concessional rate or without charge to aquaculturists whose activity is purely commercial. We are also not prepared to hold that in the circle of agriculturists fish farming is understood as agriculture.

In our opinion, for the purpose of interpreting the Act and the notification issued thereunder, the term ‘agriculture’ has to be read in contradistinction with the term ‘aquaculture’. Pisciculture is a branch of aquaculture. Pisciculture is not agriculture.

14. We find that the purpose of the entry at HSN 8436-Other agricultural, horticultural, forestry, poultry-keeping or bee-keeping machinery is specific to these machineries i.e. those used in agriculture, horticulture, forestry, poultry or bee keeping. Further, the very fact that the entry covers horticulture, forestry, poultry and bee-keeping only means that the intention of the legislature was to include the machineries used in these activities only. The contention of the applicant that it is an inclusive definition and would cover fish/shrimp farming equipment as well is, therefore, not correct. Further, it is well settled that where the definition of a word has not been given, it must be construed in its popular sense, if it is a word of everyday use. Popular sense means “that sense which people conversant with the subject-matter with which the statute is dealing, would attribute to it”. Also, the very fact that the terms horticulture, forestry, poultry-keeping and beekeeping has been separately mentioned along with agriculture shows that the intention was to keep the term agriculture in its popular sense and not an all-encompassing one.

15. The applicant has also taken recourse to the definition of the term ‘Agricultural produce’ mentioned in 2(d) to Notification No. 12/2017-CT(R), dtd. 28.06.2017. We find that Para 2 of the notification makes it very clear that the definitions mentioned in the notification are for the purposes of that notification only. Therefore, the definition mentioned in the Notification No. 12/2017-CT(R), dtd. 28.06.2017 cannot be used for interpreting the term agricultural machinery in Notification No. 1/2017-CT(R), dtd. 28.06.2017 as well the terms mentioned in the HSN 8436.

16. The applicant has also relied upon the Press release issued by the Ministry of Fisheries, Animal Husbandry & Dairying wherein it has been mentioned that ” Diesel engines, aerators, and sprinklers, essential for aquaculture operations and hatcheries will now attract only 5 % GST instead of the earlier 12 to 18 percent …” to buttress their argument of classification under HSN 8436. There are two primary reasons why this press release is not determinative. First, it was issued by the Ministry of Fisheries, Animal Husbandry & Dairying, rather than the Ministry of Finance, which holds the sole jurisdiction over taxation matters. Secondly, a press release cannot be used as a tool for the classification of a product, which is to be best left to the wisdom of judicial/quasi-judicial authorities. A similar issue came up before the Bombay High Court in the case of Schulke India (P.) Ltd. v. Union of India [2024] 91 GSTL 225 (Bom.y), wherein the Revenue relied upon a Press release dated 15.07.2020 to classify alcohol-based hand sanitizers as disinfectants like soaps, antibacterial liquids, Dettol etc., which attracted GST at the rate of 18% whereas the petitioner wanted to classify it as ‘medicament’. It was also contended that the Press release is an executive instruction under Article 73 of the Constitution read with Article 77 of the Constitution. The High Court held as under:-

“23. As noted earlier, the impugned Press Release, does not indicate that the same is relatable to either Article 73 or Article 77 of the Constitution. Though that, by itself, may not be a ground to strike down the impugned Press Release, still, in the absence of any such indication or compliance with the provisions of Article 77 of the Constitution, we cannot simply accept that the impugned Press Release is indeed an instance of the exercise of executive power by the Union. In the absence of any compliance with the requirements of Article 77, the burden was on the Respondents to establish this aspect. The Respondents have failed to discharge this burden.

24. However, even though it is assumed that the impugned Press Release is an instance of the exercise of executive power by the Union still, the question is whether, in the purported exercise of such executive power, the Union is competent to direct judicial and quasijudicial authorities to decide the issue of classification of products in a particular manner. We cannot lightly accept that the Union, in the exercise of executive power, has such authority because the issue of classification, which is essentially an issue of interpretation, must be undertaken by the various judicial and quasi-judicial adjudicatory authorities under the Statute. Though there may not be a very distinct line separating legislative and executive functions, still the line separating the judicial functions from the executive and legislative functions is fairly clear. The executive cannot transgress on the functions within the exclusive province of the judicial or even quasi-judicial authorities.

[Emphasis added]

17. Having held supra that Paddle Wheel Aerators used in fish/shrimp do not fall under HSN 8436, we find that there is no specific entry in the GST Tariff, which covers Paddle Wheel Aerators. Therefore, we are of the opinion that the Paddle Wheel Aerators would rightly fall under the residual entry HSN 8479: “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this Chapter.

18. Consequently, Paddle Wheel Aerators would attract GST @ 18% in terms of SI. No. 366 of Schedule III to Notification No. 1/2017-Central Tax, as amended, w.e.f. 01.07.2017 to 21.09.2025 and in terms of Sl. No. 464 of Schedule-II of Notification No. 9/2025-CT(R), dtd. 17.09.2025 w.e.f. 22.09.2025.

19. In view of the foregoing, we rule as under: –

RULING

Ques: Whether the product namely “Paddle Wheel Aerators” (including its parts) which are manufactured and/or sold by the applicant and used exclusively in aquaculture operations (such as shrimp and fish farming) are classifiable under:

Ans: “Paddle Wheel Aerators” (including its parts) which are manufactured and/or sold by the applicant and used exclusively in aquaculture operations (such as shrimp and fish farming) are classifiable under HSN 8479 and would attract GST @ 18% in terms of Sl. No. 366 of Schedule III to Notification No. 1/2017-Central Tax dtd. 28.06.2017, as amended, w.e.f. 01.07.2017 to 21.09.2025 and in terms of Sl. No. 464 of Schedule -II of Notification No. 9/2025-CT(R), dtd. 17.09.2025 w.e.f. 22.09.2025.