GST on Bovine Semen Sorting Services: 18% Tax Applies
Tamil Nadu tax authority ruled that lab-based bovine semen sorting services attract 18% GST under SAC 998349.
- Ruling
- Advance Ruling No. 51/ARA/2026, dated 06.08.2026
- Dated
- 06 Aug 2026
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- Applicant asked if semen sorting services are exempt from GST.
- Authority ruled sorting is a scientific lab service, not farm support.
- Semen sorting services are classified under SAC 998349.
- The service attracts GST at 18% standard rate.
- Exemption on final semen doses does not extend to lab processing.
In short
M/s. Jiva Sciences Private Limited runs a laboratory that processes raw bull semen to separate X and Y chromosomes. The company asked the Tamil Nadu tax authority whether this lab service is exempt from Goods and Services Tax (GST) under SAC 9986 as an animal husbandry support service, similar to the GST exemption given to final semen doses.
What has changed
How it worked before
Before this ruling, businesses providing high-tech laboratory processing for livestock products often assumed their services were exempt under animal husbandry support services (SAC 9986), especially because the final semen doses are exempt from GST.
What has changed
The Tamil Nadu Authority for Advance Ruling (AAR) decided under Advance Ruling No. 51/ARA/2026 that lab processing is scientific testing rather than direct animal husbandry support. It classified semen sorting under SAC 998349 as other technical and scientific services, making it taxable at 18% GST.
Who this affects
Biotechnology laboratories, specialized animal processing facilities, and businesses offering lab-based scientific services to the livestock sector.
An example
Suppose Alpha Biotech operates a laboratory that processes animal genetic materials for breeding farms before returning them for final distribution. Alpha Biotech might assume this service is exempt under animal husbandry support services (SAC 9986). Following Advance Ruling No. 51/ARA/2026, tax authorities are likely to view this laboratory processing as a scientific service under SAC 998349 taxable at 18% GST.
What you should do
If you offer lab-based services for livestock, check if you are treating them as exempt support services. Note that an advance ruling binds only the business that applied and its tax officer, but it demonstrates how tax authorities treat off-farm biotech operations.
If you do nothing
If you treat laboratory processing as tax-exempt without collecting 18% GST, a tax officer during an audit may classify your services under SAC 998349. You could face demands for unpaid tax along with interest and late penalties. This creates financial risk if you cannot recover back-dated GST from your past clients.
The terms explained
- SAC code
- Services Accounting Code used under Goods and Services Tax (GST) to classify different types of services and determine their tax rates.
- Advance ruling
- An official decision by tax authorities answering a specific tax question submitted by a business.
- SAC 9986
- A GST service classification covering support services directly related to agriculture, forestry, and animal husbandry.
- SAC 998349
- A GST service classification covering technical, scientific, and consulting services not listed under specific categories.
The ruling in detail
Authority for Advance Ruling
M/s. Jiva Sciences Private Limited
Advance Ruling No. 51/ARA/2026, dated 06.08.2026 · Tamil Nadu
Questions before the authority
- Whether “Semen Sorting Services” would qualify as an exempt service under GST, similar to the exemption granted to semen doses?
- Can we classify “Semen Sorting Services” under SAC code 9986?
- In the absence of a specific notification or classification, under which HSN/SAC code should “Semen Sorting Services” be categorized?
Facts
The applicant provides sex-sorting services for bovine semen by deploying proprietary technology in a laboratory setting to separate X and Y chromosome-bearing sperm cells. Raw semen collected from bulls at semen stations is delivered to the applicant's lab, where it undergoes biological processing and separation. The unpacked processed material is then returned to the semen stations for final packaging into doses used in artificial insemination.
Ruling
| Question | What the authority ruled |
|---|---|
| Exemption status of Semen Sorting Services | No Not exempt from payment of GST |
| Classification under SAC code 9986 | No Falls under SAC code 998349 |
| Applicable HSN/SAC code | SAC code 998349 Residuary scientific and technical services entry |
The Authority held that semen sorting services do **not qualify for exemption** under GST and cannot be classified under SAC 9986 as animal husbandry support services. The specialized laboratory process is classifiable under **SAC 998349** as other technical and scientific services nowhere else classified. Consequently, the service attracts GST at the standard rate of **18%**.
Reasoning
The authority examined SAC 9986 and Notification No. 11/2017-Central Tax (Rate), which covers support services to agriculture and animal husbandry, including intermediate job work processes directly supporting livestock rearing. It observed that the applicant operates an independent, high-technology laboratory service separating sperm cells, which constitutes specialized biological testing and value-addition rather than direct support to animal rearing or farm operations. Because the service does not fit SAC 9986, it falls under Heading 9983 for scientific and technical services. Within Heading 9983, as there is no specific entry for cell sorting, it is appropriately categorized under the residuary entry **SAC 998349**, taxable at **18% GST** under Serial No. 21(ii) of Notification No. 11/2017-Central Tax (Rate).
Provisions relied on
- Section 97(2) of CGST Act, 2017 / TNGST Act, 2017
- Section 98 of CGST Act, 2017 / TNGST Act, 2017
- Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017
- SAC 9986
- SAC 998349
For the practitioner
This ruling establishes that specialized biological processing and lab-based biotech services in the livestock sector do **not qualify as animal husbandry support services** under SAC 9986. Practitioners advising biotech labs must treat off-farm technical services as taxable under **SAC 998349 at 18% GST**, even when the ultimate end-product enjoys GST exemption. The decision does not restrict or alter the tax exemption applicable to the final supply of bovine semen doses itself.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/jiva_science_aar_order.pdf
Legibility of the scan, as read: high.
Prepared 16-10-2026.
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