GST NAA CASES
2019-TIOL-11-NAA-GST
Kerala State Screening Committee On Anti-Profiteering Vs Emke Silks And Garments Pvt Ltd (Dated: February 11, 2019)
GST - Anti-Profiteering - Allegation is that the respondent had indulged in profiteering in contravention of s.171 of the CGST Act on the supply of ‘Shirts' [Design 689] [HSN 6205] by not passing on the benefit of reduction in the rate of tax at the time of implementation of GST w.e.f 01.07.2017 - DGAP has in its report submitted that ‘Shirts' were exempted from Central Excise duty vide notification 30/2004-CX and attracted only VAT @5%; that after implementation of GST w.e.f 01.07.2017, the tax rate on the said product was fixed @5%; the rate of tax on the product remained same in the pre-GST and the post-GST era – moreover, the pre-GST and post-GST base prices (excluding tax) had remained the same, therefore, the provisions of s.171 of the CGST Act, 2017 had not been contravened and the allegation of profiteering by respondent was not established.
Held: Only issue that needs to be dwelled upon is as to whether there was a case of reduction in the rate of tax and whether the provisions of s.171 of CGST Act, 2017 are attracted – It is clear from the facts and the report of DGAP that there was no reduction in the rate of tax on the said product "Shirts" w.e.f 01.07.2017 and hence s.171(1) of the CGST Act, 2017 is not attracted - no merit in the application, hence same is dismissed: NAA
- Application dismissed: NAA
2019-TIOL-10-NAA-GST
Kerala State Screening Committee On Anti-Profiteering Vs Sudarsans
GST - Anti-Profiteering - Allegation is that the respondent had indulged in profiteering in contravention of s.171 of the CGST Act on the supply of ‘Socks' [Jockey Socks 7052 FS ASSTD] by not passing on the benefit of reduction in the rate of tax at the time of implementation of GST w.e.f 01.07.2017 - DGAP has in its report submitted that ‘Socks' were exempted from Central Excise duty vide notification 30/2004-CX and attracted only VAT @5%; that after implementation of GST w.e.f 01.07.2017, the tax rate on the said product was fixed @5%; the rate of tax on the product remained same in the pre-GST and the post-GST era - moreover the pre-GST and post-GST base prices (excluding tax) had remained the same, therefore, the provisions of s.171 of the CGST Act, 2017 had not been contravened and the allegation of profiteering by respondent was not established.
Held: Only issue that needs to be dwelled upon is as to whether there was a case of reduction in the rate of tax and whether the provisions of s.171 of CGST Act, 2017 are attracted - It is clear from the facts and the report of DGAP that there was no reduction in the rate of tax on the said product “Socks” w.e.f 01.07.2017 and hence s.171(1) of the CGST Act, 2017 is not attracted -no merit in the application, hence same is dismissed: NAA
- Application dismissed: NAA
2019-TIOL-09-NAA-GST
Kerala State Screening Committee On Anti-Profiteering Vs Emke Silks And Garments Pvt Ltd
GST - Anti-Profiteering - Allegation is that the respondent had indulged in profiteering in contravention of s.171 of the CGST Act on the supply of ‘Trousers' [Denim Jeans Design 899] [HSN Code 6203 4200] by not passing on the benefit of reduction in the rate of tax at the time of implementation of GST w.e.f 01.07.2017 - DGAP has in its report submitted that ‘Trousers' were exempted from Central Excise duty vide notification 30/2004-CX and attracted only VAT @5%; that after implementation of GST w.e.f 01.07.2017, the tax rate on the said product was fixed @5%; the rate of tax on the product remained same in the pre-GST and the post-GST era - moreover, the pre-GST and post-GST base prices (excluding tax) had remained the same, therefore, the provisions of s.171 of the CGST Act, 2017 had not been contravened and the allegation of profiteering by respondent was not established.
Held: Only issue that needs to be dwelled upon is as to whether there was a case of reduction in the rate of tax and whether the provisions of s.171 of CGST Act, 2017 are attracted - It is clear from the facts and the report of DGAP that there was no reduction in the rate of tax on the said product “Trousers” w.e.f 01.07.2017 and hence s.171(1) of the CGST Act, 2017 is not attracted - also, there is no increase in the per unit base price (excluding tax) of the above product and, therefore, the allegatioon of profiteering is not sustainable - no merit in the application, hence same is dismissed: NAA
- Application dismissed: NAA
AAAR CASE
2019-TIOL-02-AAAR-GST
Rlj Woven Sacks Pvt Ltd
GST - AAR had held that PP Leno Bags, if specifically made from woven polypropylene fabric using strips or the like of width not exceeding 5mm and without any impregnation, coating, covering or lamination with plastics are to be classified under SH 6305 3300 - Appeal filed before AAAR by Assistant Commissioner of Central Tax.
Held: CBIC has vide paragraph 7 of Circular 80/54/2018-GST dated 31.08.2018 clarified that Polypropylene Woven and Non-woven bags and PP woven and non-woven bags laminated with BOPP would be classifiable as Plastic bags under HS Code 3923 and would attract @18% GST - following the same, Advance Ruling dated 28.09.2018 is modified and appeal stands disposed of accordingly: AAAR
- Appeal disposed of: AAAR
AAR CASE
2019-TIOL-37-AAR-GST
K Uttamlal Exports Pvt Ltd
GST - Applicant seeks a ruling as to whether the goods exported out of India directly by the manufacturer mentioning the applicant as Third Party Exporter for the purpose of Foreign Trade Policy will be considered as exports at the hands of applicant and if the said transaction is held to be exports, then whether it will qualify as zero rated supply.
Held: Main question is whether the transaction effected by the applicant can be considered as exports made by them or the manufacturer exporter M/s Sai Fertilizers - apparently, this question is not covered under the purview of section 97 of the CGST Act, 2017, hence the application is not maintainable and cannot be entertained: AAR
- Application dismissed: AAR
GST HIGH COURT CASES
2019-TIOL-40-HC-KAR-GST
Global Associates Association of Persons Vs UoI
GST - Petitioner is aggrieved by the Notification 11/2017-CTR and clarification dated 09.01.2018 issued by the respondent-authorities pursuant to Entry 5(b) of Schedule II to the CGST Act, 2017 which envisages levy of tax on construction activities and deeming the value of the land at one-third of the total amount charged - Petitioner argued that irrespective of any action initiated or not by the respondent-authorities, they is entitled to challenge the same and hence the writ petition is maintainable.
Held: Apex Court in the case of Kusum Ingots - 2004-TIOL-117-SC-CX-LB has observed that passing of a legislation by itself does not confer any such right to file the writ petition unless a cause of action arises therefor - Enacting a legislation or issuing Notification/Circular could not confer a right to challenge unless the litigant is affected by the action initiated by the executive in furtherance of such legislation/administrative Circular/Notification more particularly, in taxing statutes - Cause of action is sine qua non for challenging such legislation/Notification/Circular - Writ Court cannot adjudicate upon such matters in vacuum - Adjudication of such issues sans any cause of action would be merely academic, consuming public time de hors the litigants waiting in serpentine queue seeking justice before the courts for the relief/s sought for, arising out of the cause of action - Petitioner involved in construction activity or works contract would not be sufficient to examine the constitutional vires of the Act and the related Notification/Circular unless the cause of action emerges - writ petitions at this stage are premature and deserve to be dismissed as not maintainable: High Court [para 15, 16]
- Petitions dismissed: KARNATAKA HIGH COURT
2019-TIOL-39-HC-AHM-GST
Perfect Boring Pvt Ltd Vs UoI
GST - Petitioner has challenged the order of provisional attachment passed by the respondent in exercise of powers under section 83 of the CGST Act, 2017 whereby the bank account with Bank of India, Ahmedabad Main and eight other bank accounts of the petitioner have been attached.
Held: Object of the provision is to protect the interest of the Government revenue - In the facts of the present case, attachment of the bank accounts of the petitioner has resulted into various hardships to the petitioner which would adversely affect its business and which may result in loss of revenue to the Government – Instead, if the petitioner provides for some security towards its outstanding dues, the interest of the petitioner as well as the revenue can be protected - Court is of the view that the interest of justice would be served if the petitioner is permitted to pay the amount of Rs.55,00,000/- outstanding towards excise dues by way of equal monthly installments within a period of eight months, subject to the petitioner furnishing a bank guarantee for an equal amount towards security of such amount within a period of one month - respondents are directed to forthwith release the attachment over the eight bank accounts subject to compliance with the conditions ordered - petition partly succeeds: High Court [para 6 to 8]
- Petition partly allowed: GUJARAT HIGH COURT
2019-TIOL-38-HC-KERALA-GST
Chavan Autowheels Pvt Ltd Vs State Of Maharashtra
GST - Filing of GST TRAN-1 - IT related technical errors - Dy. Commr. to GST Council informing petitioner about the IT- grievance redressal mechanism set up in terms of CBIC Circular No.39/13/2018-GST dated 03.04.2018 - Counsel for Revenue submits that this is possibly not a grievance against the Central machinery, but the State GST Officials; that Commissioner of State Tax would meet the petitioner or its representatives on Monday i.e. 11th February, 2019 at 11.30 a.m. and will ensure that the petitioner's grievances are redressed - Matter posted for passing orders on 14 February 2019: High Court [para 5]
- Matters posted: BOMBAY HIGH COURT
2019-TIOL-37-HC-KERALA-GST + Case Story
Sheen Golden Jewels India Pvt Ltd Vs STO
GST - Petitioners' plea that the State lacks the vires to engraft Section 174 into Kerala SGST Act, 2017 is rejected -A saving clause is used to preserve what already exists; it cannot create new rights or obligations - Repeal of statute results in nullification of the subordinate legislation the repealed statute has engendered - if a right has once been acquired under some statute, that right will not be taken away by the repeal of the statute under which it was acquired - A saving, is a device that preserves accrued, acquired rights and incurred liabilities under a statute that no longer exists - Section 19 of the CA Act saves nothing beyond 16.09.2017 - whole argument is sought to be erected on a slippery slope - There is no denudation of legislative power, no obliteration of Entry 54 of List II - An entry's abrogation, as it were, would not ipso facto lead to the legislative denudation - the amendment and repeal are mutually exclusive - KVAT Act stands repealed except in respect of goods included in entry 54 of the State List of the Seventh Schedule to the Constitution, including the Goods to which the Kerala General Sales Tax Act, 1963 applies as per the KVAT Act - Section 19 of the CA Act is - transitional as it may have been-a repealing clause simpliciter, not a saving clause - repeal has not, as Section 174 elaborates, affected "the previous operation of the amended Acts or repealed Acts and orders or anything duly done or suffered thereunder" - for any tax to be imposed, it requires a taxable event triggering the levy and a taxable person to discharge it -petitioners' contention that the State has lost legislative power to enact a saving clause-Section 174-in the KSGST Act does not stand the judicial gaze - none of the provisions repealed through the CA Act is central legislation - General Clauses Act does not apply to the State Legislation - perhaps, Section 4 of the Kerala Interpretation and General Clauses Act could be roped in, if ever we need anything to be saved under a repealed enactment - however, neither Act needs to be invoked here - it is a fallacy on the petitioners' part to contend that the State lacks the legislative power to enact Section 174 of the KSGST Act - Article 246A is the special provision (if it can be called a provision) on the Goods and Services Tax - It empowers both the Union and the State, for the first time, to have simultaneous - not concurrent - powers to legislate on certain items - concurrency yields to the doctrine of repugnancy, but simultaneous legislative power does not - That is, both the legislatures, say one from the Union and the other from the State, coexist-operate in the same sphere, subject to other constitutional safeguards - the petitioners' plea that the State lacks the vires to engraft Section 174 into Kerala State Goods and Services Act, 2017 is rejected: High Court
Limitation: In all these writ petitions various issues arise - constitutionality is only one of them and which is answered in the negative - All other issues-including limitation-remain untouched - limitation is a mixed question of fact and law and in that context, the petitioners have efficacious alternative remedies under the relevant statutes -To adjust equities, if any petitioner approaches a statutory authority on an issue arising out of a writ petition which now stands disposed of in this batch, the authority will exclude for limitation the period it has spent before this Court: High Court
Appeal : To enable the petitioners to approach the appellate authorities, the Department will defer coercive steps by thirty days, from the date of their receiving a copy of the judgment: High Court
- KERALA HIGH COURT
JEST GST by Vijay Kumar
In its path to perfection, GST has much dust to settle-legislatively and judicially
ARTICLES
GST - Agenda for the second year - Part XXIV
ITC on Telecommunication towers
GST - Agenda for the second year - Part XXIV
