Agriculturist Have to Register explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
A farmer whose entire output is exempt hires a goods transport agency. Section 24(iii) says a person liable to pay tax under reverse charge must register. Section 23 says an agriculturist need not. Which wins turns on a single drafting choice that the legislature made in 2017 and has never revisited.
Section 24 opens "Notwithstanding anything contained in sub-section (1) of section 22…" and requires registration of, among others, "persons who are required to pay tax under reverse charge" — clause (iii). Section 23(1) relieves agriculturists and persons making exclusively exempt supplies, with no non obstante clause of its own; section 23(2) does have one, overriding both section 22(1) and section 24. The Handbook records two competing readings and concludes the point "remains capable of litigation."
What section 24's non obstante clause actually names
The opening words are precise. Section 24 overrides section 22(1) — the turnover threshold — and nothing else.
The Handbook applies the Supreme Court's own explanation of the device, from Chandavarkar Sita Ratna Rao v. Ashalata S. Guram, AIR 1987 SC 117 = (1986) 4 SCC:
"when a clause begins with the word 'Notwithstanding' the object is to give it overriding effect over other provisions of the Act which is equivalent to saying in spite of those provisions the particular clause would have a full operation… the provisions embraced in the non obstante clause would not be an impediment for an operation of the enactment."
The reasoning that follows is the heart of the argument:
"On clear reading of section 24… it has been specifically devised to override section 22(1)… Hence section 24 will have overriding effect over section 22(1). However, section 24 of the CGST Act does not mention anything about section 23 as it is a specific and independent section on its own."
And the inference: "legislation has chosen consciously section 24 to override the provisions of section 22(1) and has deliberately left out section 23 from section 24 as section 23 is a specific section. Hence, there can be a view that person who were specifically dealing in exempted goods are not required to take compulsory registration under section 24."
The counter-reading, from section 23(2)
The opposite view draws its force from where the drafter did put a wider non obstante clause.
Section 23(2) reads: "Notwithstanding anything to the contrary contained in sub-section (1) of section 22 or section 24, the Government may, on the recommendations of the Council, by notification, subject to such conditions and restrictions as may be specified therein, specify the category of persons who may be exempted from obtaining registration under this Act."
So the Handbook's alternative is this: "since the non-obstante clause ('notwithstanding anything contained in section 22(1) and section 24') is expressly provided only in sub-section (2) of Section 23 and not in sub-section (1), unless the Government issues a specific notification, exemption from registration beyond the cases of reverse charge supplies notified under Section 23(2) cannot be extended."
The argument has real force. If sub-section (1) already overrode section 24, sub-section (2) would not have needed to say so — and courts are reluctant to read a provision as surplusage.
The two readings side by side
| Reading A — no registration | Reading B — registration required | |
|---|---|---|
| Anchor | Section 24 names only s.22(1); the omission of s.23 is deliberate | The wide non obstante appears only in s.23(2), so s.23(1) does not override s.24 |
| Treats s.23(1) as | A specific and independent provision that section 24 never touches | A relief subordinate to the compulsory-registration scheme |
| Effect on the farmer | No registration despite RCM liability | Must register the moment a single RCM liability arises |
| Weakness | Renders the s.23(2) reference to s.24 partly redundant | Makes the s.23(1)(b) relief evaporate on one GTA freight bill |
The Handbook's own conclusion is stated in its RCM chapter: "a logical view can be taken that such persons continue to remain outside the registration requirement even if reverse charge liability arises; however, an alternate interpretation is also possible, and the issue remains capable of litigation."
Why Notification No. 5/2017 defuses most of it
In practice the dispute rarely has to be resolved, because a notification issued under section 23(2) — which indisputably overrides section 24 — already covers the common case.
Notification No. 05/2017-Central Tax dated 19.06.2017, w.e.f. 22.06.2017 exempts from registration persons exclusively making supplies on which tax is payable by the recipient under section 9(3).
So an agriculturist selling raw cotton or tobacco leaves is protected by the notification itself, without any interpretive argument: the buyer pays under Notification No. 4/2017-CT(R), and the farmer is expressly outside registration. The Notification No. 4/2017 entries →
The dispute survives where the RCM liability is on the inward side. A farmer who receives a GTA service, a legal service or a sponsorship service, and is thereby liable to pay under section 9(3) as recipient, is not covered by Notification No. 5/2017 — which speaks of persons making outward supplies liable to RCM. That is the case where Reading A and Reading B genuinely diverge.
What follows if registration is required
The consequences are not trivial, which is why the question matters:
- Tax under reverse charge must be paid in cash. "Payment of taxes under reverse charge cannot be made with utilization of input tax credit and has to be made in cash."
- Credit is available only after the cash payment. "The recipient can take the credit of tax paid on inward supplies liable to reverse charge once the payment of tax is made in cash."
- But for an agriculturist the credit is worthless, because his outward supplies are exempt and section 17(2) blocks it.
- A self-invoice and a payment voucher are required where the supplier is unregistered — section 31(3)(f) and (g), and rule 52.
- Time of supply is the earliest of receipt of goods, payment, or the day after thirty days from the supplier's invoice.
And no partial reverse charge exists. "No partial reverse charge is applicable under GST as was existed under erstwhile Service Tax Law. 100% tax will be paid by the recipient if reverse charge mechanism applies."
Key takeaways
- Section 24 overrides only section 22(1) by its own terms, and is silent on section 23.
- Reading A: that silence is deliberate — section 23(1) is a specific and independent relief that section 24 cannot displace.
- Reading B: the wide non obstante clause appears only in section 23(2), so section 23(1) does not override section 24 without a notification.
- The ICAI Handbook records both and calls the issue "capable of litigation" — it is not settled.
- Chandavarkar Sita Ratna Rao supplies the governing principle on how a non obstante clause operates.
- Notification No. 5/2017-CT resolves the common case — persons making outward supplies liable to RCM under section 9(3) are expressly outside registration.
- The live dispute concerns inward RCM liabilities — a GTA, legal or sponsorship service received by an otherwise exempt person.
- If registration is required, RCM tax is payable in cash, and the credit is unusable where outward supplies are exempt.
Read next
- Section 23(1)(b): The Agriculturist's Exemption From Registration
- RCM on Agricultural Goods: Notification No. 4/2017, Entry by Entry
- Import of Agricultural Services and the IGST Reverse Charge Exemption
Disclaimer: Positions stated as on 5 September 2026, based on sections 2(98), 22, 23, 24, 31(3) and 9(3) of the CGST Act, 2017, rule 52 of the CGST Rules, 2017, Notification No. 05/2017-Central Tax and the decision in Chandavarkar Sita Ratna Rao v. Ashalata S. Guram, as reproduced in the ICAI Handbook on Applicability of GST on Agricultural Sector (January 2026, law updated to 31 December 2025).
Key Facts About Agriculturist Have to Register
- Applies in: All states across India, under the relevant central law.
- Mode: Mostly online via the official government portal.
- Typical timeline: Ranges from a few days to a few weeks depending on the case.
- Non-compliance: May attract penalties, interest or late fees.
- Expert help: TaxClue completes the entire process end to end for you.
Must a farmer register if he pays GST under reverse charge on freight?
The position is unsettled. One reading says no, because section 24 overrides only section 22(1) and not section 23; the other says yes, because the wide non obstante clause appears only in section 23(2).
What did the Supreme Court say about non obstante clauses?
In Chandavarkar Sita Ratna Rao v. Ashalata S. Guram, that such a clause gives the enacting part overriding effect over the provisions named in it — which is why the provisions section 24 names, and does not name, matter.
Over 90% of compliance penalties in India arise from missed due dates — timely handling can save businesses thousands of rupees each year.
Agriculturist Have to Register: a key compliance topic in Indian tax and corporate law that businesses and individuals must understand to remain compliant.