Section 2(7): Who Is an "Agriculturist" Under GST

Section 2 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.

The word carries a specific legal meaning, and it is much narrower than "farmer". Two filters apply, and a person who fails either one is not an agriculturist however genuinely agricultural the activity.

Section 2(7) defines "agriculturist" as "an individual or a Hindu Undivided Family who undertakes cultivation of land — (a) by own labour, or (b) by the labour of family, or (c) by servants on wages payable in cash or kind or by hired labour under personal supervision or the personal supervision of any member of the family." The status matters because section 23(1)(b) relieves an agriculturist from registration to the extent of supply of produce out of cultivation of land, and because Notification No. 4/2017-Central Tax (Rate) puts several agricultural goods supplied by an agriculturist** under reverse charge in the buyer's hands.

Filter one: the constitution of the person

Only an individual or a Hindu Undivided Family can be an agriculturist. Nothing else in the section 2(84) list of persons qualifies.

So none of these is an agriculturist, however extensive the farming:

The Handbook states the consequence plainly: "The exemption from registration is dependent on status of the supplier and not based on the commodity involved. Person other Individual or HUF does not enjoy this exemption and will be liable for registration as well as payment of tax if the agricultural produce grown by them is not exempt from tax."

And it notes why this rarely bites: "Majority of farmers in India are small farmers doing farming in individual or HUF capacity. They will thus not be covered under GST."

Filter two: who supplies the labour

The person must undertake cultivation of land in one of three ways:

• (a) by own labour — the cultivator works the land himself;
• (b) by the labour of family — "family" is defined at section 2(49) as "the spouse and children of the person, and the parents, grand-parents, brothers and sisters of the person if they are wholly or mainly dependent on the said person";
• (c) by servants on wages payable in cash or kind, or by hired labour under personal supervision or the personal supervision of any member of the family.

Clause (c) carries the operative words: "under personal supervision". Hired labour does not destroy the status; absentee ownership does. A landowner who employs a manager and never supervises the cultivation himself, nor through a family member, is outside clause (c).

And note the asymmetry inside section 2(49). Spouse and children count without any dependency test; parents, grandparents, brothers and sisters count only if wholly or mainly dependent.

"Cultivation of land" is the boundary of the relief

Even where a person is an agriculturist, the relief in section 23(1)(b) is confined "to the extent of supply of produce out of cultivation of land".

The Handbook draws the line at the point of deviation: "If an agriculturist undertakes supplies which are not linked to the cultivation of land, he will fall within the provisions of sections 22 and may have to take registration in respect of such supplies. It is important to consider the nature of activities undertaken by the agriculturist. If the process deviates from 'cultivation' it will travel outside the scope of this exclusion from registration."

Two practical consequences.

Processing and trading break the relief. "if an agriculturist engages in any other taxable activity, such as processing, packaging, or trading of agricultural produce, etc., then he or she will be liable to register under GST based on the taxability of those activities."

And renting is not cultivation. An agriculturist who lets out a tractor, a warehouse or a shed is making a supply of services, not supplying produce out of cultivation of land.

Why the status matters in three places

Registration. Section 23(1)(b) — no registration to the extent of produce out of cultivation of land. The section 23(1)(b) relief →

Reverse charge on goods. Notification No. 4/2017-CT(Rate) puts four categories under reverse charge specifically when the supplier is an agriculturist — cashew nuts not shelled or peeled (0801), bidi wrapper leaves (1404 90 10), tobacco leaves (2401) and raw cotton (5201). The registered buyer pays.

The design is deliberate. As the Handbook puts it: "It should be noted that the exclusion from the requirement to be registered does not result in non-collection of tax on agricultural produce. In this case as per Section 9(3)… on supply of certain goods by agriculturist, the recipient has to pay tax under Reverse Charge." The Notification No. 4/2017 entries →

Circular-level clarifications. Circular No. 247/04/2025-GST dated 14.02.2025 confirms that "an agriculturist supply of dried pepper from their plantation to the extent of the supply of produce out of cultivation of land is not liable to take registration under Section 23(1) of CGST Act", and "an agriculturist supplying raisins is not liable to be registered under Section 23(1) of the CGST Act, and is exempt from GST."

Note what that circular really decides. Dried pepper is taxable goods — HSN 0904, 5% under S. No. 38 of Schedule I of Notification No. 1/2017-CT(Rate), now superseded by Notification No. 09/2025-CT(Rate) dated 17.09.2025. The agriculturist still need not register, because section 23(1)(b) turns on who is supplying and out of what, not on whether the goods are exempt.

"Agriculturist" against "agricultural produce"

The two terms do different work and are frequently confused.

They can come apart in both directions. A company growing paddy supplies agricultural produce but is not an agriculturist. An individual farmer selling jaggery he has boiled is an agriculturist supplying goods that are not agricultural produce. What counts as agricultural produce →

Key takeaways

• Section 2(7) confines "agriculturist" to an individual or a Hindu Undivided Family.
• A company, LLP, firm, society or trust is never an agriculturist, whatever its farming operations.
• Cultivation must be by own labour, family labour, or servants and hired labour under personal supervision — absentee cultivation fails clause (c).
• "Family" (s.2(49)) includes spouse and children unconditionally; parents, grandparents, brothers and sisters only if wholly or mainly dependent.
• The registration relief extends only to the extent of produce out of cultivation of land — processing, packaging and trading are outside it.
• Circular No. 247/04/2025-GST confirms the relief for dried pepper and raisins, even though the goods are taxable.
• The status also triggers reverse charge under Notification No. 4/2017-CT(R) on cashew nuts, tendu leaves, tobacco leaves and raw cotton.
• "Agriculturist" describes a person; "agricultural produce" describes goods — the two tests are independent.

Read next

• Section 23(1)(b): The Agriculturist's Exemption From Registration
• RCM on Agricultural Goods: Notification No. 4/2017, Entry by Entry
• Agriculture Exemptions: Entries 54 to 58 and "Agricultural Produce"

Disclaimer: Positions stated as on 5 September 2026, based on sections 2(7), 2(49), 2(84), 22, 23 and 24 of the CGST Act, 2017, Notification No. 4/2017-Central Tax (Rate), Notification No. 09/2025-Central Tax (Rate) dated 17 September 2025 and Circular No. 247/04/2025-GST dated 14 February 2025, as reproduced in the ICAI Handbook on Applicability of GST on Agricultural Sector (January 2026, law updated to 31 December 2025).