FLASH NEWS
FM urges States to make use of District Mineral Fund for testing of COVID-19 patients
Govt directs States to use Construction Labour Cess money to help construction workers; Kitty size is Rs 31000 Crore as on date, says FM
FM says EPFO regulations to be amended to allow non-refundable withdrawal of three months of salary or 75% of fund by employees of organised sector
Govt promises to pay EPFO payments on behalf of employer & employee for 3 months for establishments up to 100 employees provided 90% get less than Rs 15K salary
FM announces doubling of collateral-free loans to 63 lakh Self-Help Groups covering 7 Crore households
Govt to provide free LPG cylinders to 8.3 Crore BPL families under Ujjwala Scheme
FM announces Rs 500/- ex gratia amount per month for 20 Cr women Jan Dhan A/c holders for next 3 months
Govt announces ex-gratia amount of Rs 1000 per month to poor widows, senior citizens and disabled for next three months in two instalments through DBT
FM announces Economic Relief Package - 8.69 Crore farmers to get Rs 2000/- cash under PK Kisan Yojana in first week of April + daily wage under MGNREGA hiked by Rs 2000 per month for five crore families
FM unfolds PM Garib Kalyan Food Scheme - 5 kg rice or wheat in addition to existing 5 kg foodgrain + 1 kg pulse for next 3 months in two instalments; to cost Rs 1.7 lakh crore to Exchequer
GST return due dates for March, April & May extended up to June 30 + No interest, late fee and penalty to be charged up to Rs 5 Crore turnover + Date for Composition option also extended up to June 30
CBIC notifies several GST Council's decisions related to procedural and Rule changes including IBC related clarification
TOP NEWS
GST - Yet another fake invoice fraud busted
GST NOTIFICATIONS
CGST RATES
03/2020
GST rates in Schedules I, II & III amended relating to match box etc
02/2020
Lower GST rate for MRO services notified
IGST RATES
03/2020
IGST rates for match box, mobile etc notified
02/2020
5% IGST rate notified for MRO Services
UTGST RATES
03/2020
Rates notified for Mobile and Match box
02/2020
Rate notified for MRO
CGST RULES
29/2020
Seeks to prescribe return in FORM GSTR-3B of CGST Rules, 2017 along with due dates of furnishing the said form for April, 2020 to September, 2020
28/2020
Seeks to prescribe the due date for furnishing FORM GSTR-1 by such class of registered persons having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or the current financial year, for each of the months from April,2020 to September, 2020.
27/2020
Seeks to prescribe the due date for furnishing FORM GSTR-1 for the quarters April, 2020 to June, 2020 and July, 2020 to September, 2020 for registered persons having aggregate turnover of up to 1.5 crore rupees in the preceding financial year or the current financial year.
26/2020
Seeks to extend due date for furnishing FORM GSTR-3B of the said rules for the months of July,2019 to September, 2019 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, shall be furnished electronically through the common portal, on or before the 24th March, 2020
25/2020
Seeks to extend due date for furnishing FORM GSTR-3B for the months of October, 2019 , November, 2019 to February, 2020 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir on or before the 24th March, 2020.
24/2020
Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, for the quarter July-September, 2019 till 24th March,2020.
23/2020
Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, by such class of registered persons having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or current financial year, for each of the months from July, 2019 to September, 2019 till 24th March, 2020.
22/2020
Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, and having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or current financial year, for the month of October, 2019 and November, 2019 to February till 24th March, 2020.
21/2020
Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir or the Union territory of Jammu and Kashmir or the Union territory of Ladakh for the quarter October-December, 2019 till 24th March, 2020
20/2020
Seeks to extend due date for furnishing FORM GSTR-7 for those taxpayers whose principal place of business is in the erstwhile State of Jammu and Kashmir for the July, 2019 to October,2019 and November, 2019 to February, 2020.
19/2020
Seeks to specify class of persons, other than individuals who shall undergo authentication, of Aadhaar number in order to be eligible for registration.
18/2020
Seeks to notify the date from which an individual shall undergo authentication, of Aadhaar number in order to be eligible for registration.
17/2020
Seeks to specify the class of persons who shall be exempted from aadhar authentication.
16/2020
Seeks to make third amendment (2020) to CGST Rules.
15/2020
Seeks to extend the time limit for furnishing of the annual return specified under section 44 of CGST Act, 2017 for the financial year 2018-2019 till 30.06.2020.
14/2020
QR Code implementation w.e.f 01.10.2020
13/2020
E-invoice implementation w.e.f 01.10.2020
12/2020
Furnishing of form GSTR-1 for 2019-20 waived for specified taxpayers
11/2020
Special Procedure for Corporate debtors under IBC, 2016 so as to enable them to comply with GST laws
10/2020
Merged UTs of Daman and Diu & Dadra and Nagar Haveli - Tax period, registration, Electronic Credit ledger regarding - Transition period - Special procedure laid down
CGST CIRCULAR
circular-cgst-132
Appeals to GSTAT - Lower appellate authorities to dispose pending appeals expeditiously without waiting for constitution of Appellate Tribunal - Preamble to mention time limit
HIGH COURT
2020-TIOL-643-HC-DEL-GST
Sarvpriya Securities Pvt Ltd Vs UoI
GST - Anti Profiteering - An application was filed before the Haryana State Screening Committee on Anti Profiteering u/r 129(6) of the CGST Rules 2017 - The applicant claimed to have purchased a flat in a project developed by the petitioner herein and alleged that the petitioner had not passed on the benefit of input tax credit through commensurate reduction in price in terms of Section 171 of the CGST Act - The matter was referred to the DGAP, which considering the material submitted by the petitioner, determined the profiteered amount at about Rs 9.96 crores which included GST on the base profiteered amount - The DGAP also observed that the benefit of additional ITC worked out to about 10.65% of the turnover and had to be passed on to 1039 recipients - Thereafter, the NAA observed the profiteered as computed by the DGAP to be correct since it had been arrived at based on returns filed by the petitioner and the ITC as percentage of the turnover available to the petitioner during the pre and post GST period was computed based on records, information and returns furnished by the petitioner - Hence such figures were held to be reliable - The petitioner was held to be under a legal obligation to pass on benefit of ITC to its buyers and that the same could not be appropriated by it - Its claim of having passed on ITC of about Rs 4.08 crores was quashed, considering that though there were certain entries in the petitioner's ledger accounts, it could not be ascertained if such entries were on account of passing on ITC benefit - Hence the petitioner was directed to reduce the prices commensurate to reduction in rate of GST and also to pass on the profiteered amount along with 18% interest - As the petitioner's activity of denying benefit of rate reduction is in contravention of the mandate of Section 171(3A), SCN was directed to be issued proposing to impose penalty u/s 171(3A) r/w Rule 133(3)(d) - Hence the present writ petition.
Held - Notice be issued to the parties - Respondent-Union given six weeks' time to file counter affidavits - Moreover, considering the facts and circumstances, the stay is directed on the operation of the order passed by the NAA, conditional upon the petitioner depositing 10% of the amount of profiteering assessed by the NAA - Such pre-deposit is to be made within four weeks' time: HC
- Notice issued: DELHI HIGH COURT
2020-TIOL-641-HC-MUM-GST
Nelco Ltd Vs UoI
GST - Petitioner had accumulated CENVAT credit and they attempted to file TRAN-1 form on 27.12.2017 but could not do so as, according to the petitioner, there were problems on the common portal - it is submitted that they sent an email to the official but did not get any response; that when they again tried on 28 December 2017, it did not permit filing the same and they, therefore, made another email complaint on 12 January 2018 but received no response and, therefore, they have filed the petition - It is grievance of the petitioner that the last communication made was on 23 April 2018 which too has not been answered and they are, therefore, in danger of losing the CENVAT credit - petitioner has also challenged the rule 117 of the CGST rules as being ultra vires sections 140(1), (2), (3) and (5) of the Act to the extent that it prescribes a time limit for filing TRAN-1 form.
Held:
++ The rights and privileges accrued during the existing law have been saved u/s 174 of the CGST Act - if what is saved from the earlier regime was conditional, then it cannot be converted to something without conditions in the new regime during the period of transition - If, before and after the GST regime, the availment of Input Credit is conditional, then it cannot be that it is without any limit in the transitional period - With the advent of an entirely new tax regime, the earlier credit could have lapsed, but as and by way of concession, it is permitted to be carried forward for a limited time - Thus going by the scheme of the Act u/s 140(1), the reference to Input Tax credit is not by way of a right, but as a concession - Once it is held that the rule making power exists and the placing of a time limit on the concession is not ultra vires , then the further tinkering with the statutory scheme on hyper technical and academic arguments is neither desirable nor necessary - time limit in rule 117(2) is traceable to the rule making power conferred in s. 164(2) and the credit envisaged under section 140(1) being a concession, it can be regulated by placing a time limit, therefore, time limit under rule 117(1) is not ultra vires the Act: High Court [para 43, 46, 47]
GST - Petitioner contends that the time limit imposed u/r 117 is arbitrary and is in violation of Article 14 of the Constitution.
Held:
++ When economic legislation is questioned, the Courts are slow to strike down a provision which may lead to financial complications - Taxation issues are highly sensitive and complex; legislations in economic matters are based on experimentations; Court should decide the constitutionality of such legislation by the generality of its provisions - Trial and error method is inherent in the economic endeavours of the State - In matters of economic policy, the accepted principle is that the Courts should be cautious to interfere as interference by the Courts in a complex taxation regime can have large scale ramifications - What is claimed by the petitioner is not a right but a concession and secondly the rule is not ultra vires - even on the aspect of unreasonableness, judicial pronouncements already hold the field - for the new regime to come into force, the transitional arrangements have been made - The view taken by the Gujarat High Court in Willowood is that Rule 117 is not ultra vires and there is no indefeasible right to carry forward CENVAT credit and the stipulation of the time limit is reasonable - the time limit in the impugned rule is not arbitrary or unreasonable - for an efficient administration of a tax system, certainty, especially in terms of time is important - Calculations of the tax liability dictated by subjective conditions can lead to uncertainty and such uncertainty makes it difficult to budget and ensure that funds are allocated where they are most required - the time limit for availing of input tax credit in the transitionary provisions is rooted in larger public interest of having certainty in allocation and planning, the time limit u/r 117 is thus not irrelevant - upholding only the right to carry forward the credit and ignoring the time limit would make the transitional provision unworkable - Credit under the transitional provision is not a right to be exercised in perpetuity and by the very nature of the transitional provision, it has to be for a limited period - Once, under the GST law for future transactions of ITC, time limit is stipulated, then there is nothing unreasonable in the stipulated time limit for the transitional period - if relief is to be granted to the individual petitioner overriding the time limit on equity, the perception of what is equitable will differ from authority to authority and would lead to uncertainty and the operation of the complicated tax system will become unworkable - there is also no merit in the submission that insistence on submitting declaration electronically creates a classification between those with needed capabilities and equipment and those who do not and hence is violative of Article 14 - With the ever-expanding sweep of digital data pervading almost all walks of life, it will be a retrograde step to declare a provision unreasonable because it mandates electronic compliance, especially when the enactment in question is an intricate tax regime powered by a software based system - Therefore, the time limit stipulated under rule 117 is neither unreasonable or arbitrary nor violative of Article 14 - Rule 117 is in accordance with the purpose laid down in the Act: High Court [para 51, 53, 54, 56, 58, 59, 60]
GST - Rule 117(1A) - meaning of the phrase “technical difficulties” - This rule provides that the Commissioner may, on the recommendations of the Council, extend the date for submitting the declaration electronically in form GST TRAN-1 by a further period not beyond 31st March 2019 (now extended to 31st March 2020) regarding registered persons who could not submit the said declaration by the due date because of ‘technical difficulties' on the common portal and regarding whom the GST council has made a recommendation for such extension - Petitioner contends that the ambit of the phrase ‘technical difficulties' will have to be defined by the Court and it cannot be let to the IT Grievance Cell of the GST council to define the same.
Held:
++ GST Council is not a body to resolve technical issues, therefore, an IT Grievance Redressal Mechanism was developed by the GST Council and this Committee involved the CEO of the GST, Network Director General of Systems, CBSC and the Nominee from State as technical persons and based on the report of this Technical committee, a further recommendation would be made, therefore, there is no merit in the contention that the power could not have been delegated to the IT Grievance Redressal Committee - Contention of the petitioner that the phrase 'technical difficulty' in rule 117(1A) has to be broadly construed is not possible - Rule 117(1A) refers to technical difficulties in online submission of TRAN-1 form on the common portal and these technical difficulties are not the ones faced in general but on the common portal of GST - meaning of the phrase 'technical difficulty' is thus clear that it is the technical difficulties which arise at the common portal of GST - The system log is an auto-generated data which records the activities performed; this data is not manually collected but auto-generated and from the system log it can be ascertained as to whether an attempt was made to access the data, therefore, not only there is nothing arbitrary in insisting on system log but a correct criterion - The system log is an unquestionable criterion for ascertaining the activity on the portal - the system log on the common portal does not support the case of the petitioner and this has been communicated - no direction can thus be issued to the respondents now to treat the case of the petitioner as filing within the ambit of Rule 117(1A) of the Rules - Petition is dismissed: High Court [para 66, 67, 68, 75, 76, 77]
- Petition dismissed: BOMBAY HIGH COURT
2020-TIOL-640-HC-CHHATTISGARH-GST
K P Sugandh Ltd Vs State of Chhattisgarh
GST - The petitioner company is engaged in manufacturing Pan Masala and Tobacco Products - In the relevant period, the petitioner dispatched consignments of Pan Masala and Tobacco Products to its customers - The petitioner was issued a tax invoice and e-way bill was generated and handed over to the person in charge of the vehicle - The vehicle was intercepted en route whereupon details of the consignment were sought - The vehicle driver produced the relevant invoice bills and e-way bill - However, the vehicle and the goods were seized on account of there being discrepancies in the valuation of the goods - Notice in Form GST MOV-07 was issued u/s 129(3) of the Act to the person in charge of the conveyance - Though the petitioner moved an application seeking release of the vehicle and the goods, the Revenue passed an order wherein duty demand was raised and penalty was imposed - Hence the present writ.
Held - From the facts and circumstances, it emerges that when the vehicle was intercepted, the person in charge of the conveyance was carrying the requisite documents which were supposed to be carried in course of transportation of the goods - Regarding the discrepancy found during inspection, the only observaton made by the authorities concerned is that the valuation did not appear to have been conducted properly - Mrely because the manufacturer sells products to customer or dealer at a price lower than the MRP, the same does not constitute valid grounds to seize the product or the vehicle carrying it - If the same is found to be contrary to law, the Revenue authorities are to conduct appropriate proceedings as per law - Where the case is only of the products allegedly being sold at cost lower than the MRP, the inspecting authorites could only have intimated the assessing officer to initiate proper proceedings - Besides, the details in the invoice bill and e-way bill matched the products found in the vehicle at time of inspection - Therefore, under valuation of a good in the invoice cannot be a ground for detention of the goods and vehicle for a proceeding to be drawn under Section 129 of the Central Goods and Service Tax Act, 2017 read with Rule 138 of the Central Goods and Service Tax Rules, 2017 - Hence the order raising demand and imposing penalty merits being set aside: HC
- Writ petition allowed : CHHATTISGARH HIGH COURT
2020-TIOL-633-HC-KOL-GST
Amazonite Steel Pvt Ltd Vs UoI
GST - Section 83(2) of CGST Act, 2017 is crystal clear that the provisional attachment shall cease upon expiry of one year - It was, therefore, incumbent on the authorities to either release the provisional attachment by informing the bank or by issuing a fresh order of provisional attachment, if the law so allowed – failure to do so is an act of highhandedness - Respondent authorities directed to pay costs of Rs.5 Lakhs to each of the three petitioner companies - There is nothing in the section which indicates that upon completion of the prescribed period, a fresh order cannot be issued - given the far-reaching consequences of provisional attachment u/s 83, Court is of the opinion that an issuance of a fresh order u/s 83 of the CGST Act, 2017 will require a fresh review and assessment of the circumstances in hand - a fresh order should not be issued in the garb of an extension of the earlier order without actually evaluating and analyzing the requirement of doing so - there is no requirement on the part of the respondent to serve such an order under Section 83 personally upon the petitioners – Petitions disposed of: High Court
- Writ petitions disposed of: CALCUTTA HIGH COURT
2020-TIOL-617-HC-KERALA-GST
Zero Discharge Technologies Pvt Ltd Vs State Tax Officer
GST - Transport was detained under Sec. 129 of the CGST Act, since part B of the e-way bill was not filled up and hence Rs.8,10,000/- towards tax and the same amount towards penalty was collected from the petitioner, following which final order at Ext.P-3 is also issued - 1st respondent as per Ext.P-5 order dated 19.11.2019 has refused to credit Rs. 8,10,000/- towards the GST registration number of the petitioner in spite of the request made by the petitioner in that regard, hence the petition.
Held: Court is of the considered view that the matter requires serious reconsideration at the hands of the 1st respondent as vital aspects enumerated in paras 15 and 16 of the Writ Petition (Civil) have not been duly considered and adverted to by the 1st respondent - Accordingly, for effectuating such a remit, it is ordered that the impugned Ext.P-5 order dated 21.11.2019 refusing to credit the abovesaid amount towards the GST registration number of the petitioner will stand quashed and the matter in relation thereto will stand remitted to the 1st respondent for consideration afresh - decision to be taken preferably within a period of six weeks - Petition disposed of: High Court [para 4]
- Petition disposed of : KERALA HIGH COURT
2020-TIOL-616-HC-AHM-GST
Gallops Infrastructure Ltd Vs UoI
GST - Petitioner tried to upload the Form GST TRAN-1 as prescribed under Rule 117 of the GST Rules, however, the same could not be uploaded - nonetheless, the petitioner was able to save the form online - Petitioner, therefore, seeks a writ of mandamus directing the respondents to act on the representations made by the petitioner for grant of transitional ITC u/s 140.
Held: In view of the aforesaid Order No.01/2020 of the GST, the grievance of the petitioner can be redressed, if the respondents allow the petitioner to upload the Form GST TRAN-1 on or before 30th March, 2020 - Moreover, the petitioner is entitled to credit of Cenvat as per the decision of M/S Siddharth Enterprises = 2019-TIOL-2068-HC-AHM-GST - The petitioner is entitled to avail the benefit of Cenvat Credit under Section 140(3) of the Act irrespective of time limit prescribed under Rule 117 of the CGST Rules as observed in the aforesaid judgment - Such exercise shall be completed within a period of two weeks: High Court [para 7 to 9]
- Petition disposed of : GUJARAT HIGH COURT
2020-TIOL-615-HC-AHM-GST
ABB India Ltd Vs UoI
GST - By way of an ad-interim-order, Bench had directed the applicant to deposit an amount of Rs.50,40,972/- towards tax, with the respondent No.2 and an amount of Rs.50,40,972/- towards the penalty, in the form of the Bank Guarantee of any Nationalized Bank - Applicant complied with this order dated 10.01.2020 - However, a notice dated 5th February, 2020, in Form GST-MOV-10, came to be issued and in all, four separate notices, in Form GST-MOV-10, came to be issued for four different vehicles - subject matter of challenge in the main matter is the notice, issued by the authority, under Section 129(3) of the Act i.e. Form GST-MOV-07 as well as the order passed by the authority in Form GST-MOV-09.
Held: It appears that the authority concerned througly misconstrued the order of the Bench dated 10.01.2020 and the whole basis of issuing Form GST-MOV-10 appears to be erroneous in law - understanding of the authority is that since the notice under Section 129(3) of the Act is dated 31st December, 2019, the applicant ought to have deposited the amount, towards tax and penalty, within 14 days thereof, and the failure, to deposit such amount, would entail the consequences of notice in Form GST-MOV-10 - Bench is of the view that there is no question of looking into Section 129(6) of the Act, more particularly, when Court has passed a specific order dated 10th January, 2020 - Bench fails to understand on what basis the period of 14 days came to be calculated for the purpose of issuing GST-MOV-10 - except Section 129(6) of the Act, there is no other ground for the purpose of issuing notice in Form GST-MOV-10 and if that be the case, then Bench has no hesitation in quashing the Form GST-MOV-10 notice straightaway - application succeeds and is hereby allowed - The impugned notices, issued in Form GST-MOV-10, dated 05.02.2020, are quashed and set aside: High Court [para 8 to 12]
- Petition allowed : GUJARAT HIGH COURT
2020-TIOL-591-HC-KERALA-GST
Shree Engineers Contractors Pvt Ltd Vs Assistant State Tax Officer
GST - Officers of GST detained the goods on the premise that the consignment was not accompanied by an invoice - Petitioner contends that the said requirement is not necessary, nonetheless, for the release of the detained goods, they are willing to submit half of the bank guaranteee and half indemnity bond - Counsel for Revenue submits that for the purpose of provisional release of the seized goods, in view of Section 129(1)(b) and 129(1)(c) as well as Rule 140, security in the form of bank guarantee equivalent to the amount of applicable tax, interest and penalty is liable to be paid/furnished - Revenue counsel urged the Court for dismissal of the writ petition with a further request that all these factors would be considered by the adjudicating authority.
Held: Petitioner is not willing to pay the security in the form of bank guarantee equivalent to the amount of applicable tax, interest and penalty - matter is in the domain of the adjudicating authority - Since the goods are already lying seized with effect from 27.02.2020, the goods can be released on furnishing of Bank guarantee for the full amount as per provision of Section 129 of CGST Act, 2017 - Writ petition is disposed of with a direction to the adjudicating authority to adjudicate the matter preferably within a period of 45 days, in accordance with law, after affording opportunity of hearing to the parties: High Court [para 4, 5]
- Petition disposed of : KERALA HIGH COURT
2020-TIOL-590-HC-KERALA-GST
Ceat Ltd Vs Assistant State Tax Officer
GST - For the purpose of transporting Auto Mobile Tyres, Tubes, Flaps, an e-way bill was generated on the basis of tax invoice dated 02.03.2020 at 12.30 pm, with vehicle number KL07 CM 5213 - Enroute, for the reason of mechanical problem, the C & F Agent arranged another vehicle No.KL07 BY 3069 for onward transportation - amendment in the eway bill was caused on 02.03.2020 at 7.31.pm - Alleging that at the time of interception, the purported correction was not recorded in the e-way bill as it was issued at 3.55 pm and which tantamount to violation of the provisions of s.129 of the GST Act, 2017, the goods/vehicle were detained - Petitioner submits that the reasons assigned in the detention order are totally atrocious much less fallacious.
Held: Section 129 of the CGST Act starts with a non obstante clause enabling the officers of Revenue to detain vehicles in case the vehicles are transported without statutory documents - The e-way bill at that relevant point of time did not mention the truck No. KL07 BY 3069 whereas at the relevant time it was no. KL07 CM 5213 - In such circumstances, Bench is of the view that Court cannot sit over the decision of the adjudicating authority to form an opinion as it is strictly within the domain of the authority to consider at appropriate and relevant point of time - As an interim measure, Bench orders the release of vehicles provisionally on submission of bank guarantee in terms of the provisions of Section 129 - On submission of the documents and necessary compliance, the goods and the vehicle detained are released subject to the outcome of the decision to be taken by the Revenue - adjudicating authority to take the decision within a period of two months and till such time, it shall not encash the bank guarantee and take necessary steps on the basis of the finality of the proceedings: High Court [para 3, 4]
- Petition disposed of : KERALA HIGH COURT
2020-TIOL-589-HC-KERALA-GST
Tiger Steels Vs Assistant State Tax Officer
GST - Petitioner's grievance is that while transporting goods for purpose of weighment, same was intercepted by the officials of the State GST for the reason that in the delivery challan, instead of IGST, inadvertently CGST and SGST was levied - Petitioner prays for issuance of an appropriate direction to release the goods without collecting tax and penalty.
Held: Writ petition is disposed of with a direction to the petitioner to seek the release of the goods and carriage on furnishing of the bank guarantee and other charges as enshrined under Section 129 subject to condition that the adjudicating authority would afford an opportunity of hearing to the petitioner for imposition of the penalty, strictly in accordance with law and till such time, the bank guarantee furnished by the petitioner shall not be encashed: High Court [para 3]
- Petition disposed of : KERALA HIGH COURT
AAR CASES
2020-TIOL-58-AAR-GST
Department Of Printing, Stationery And Publications
GST - The applicant, The Government Press, is an organisation established by the Government of Karnataka under the control and supervision of the Primary and Secondary Education Secretariat to cater to the Printing and Stationery requirements of the State Government offices namely Governor's office, Legislature, Government Secretariat, High Court and other Government departments seeks to know as to whether these goods/services are taxable or exempted goods/services; if taxable, under which entry, and since materials are supplied by one Government department to another department or autonomous bodies controlled by the government, whether they can claim exemption on the supply of these materials.
Held: Printing and supply of text books and printed materials, annual reports, receipt books, measurement books and log books when supplied to government departments not registered under GST Act is exempted as such transaction does not qualify as supply under s.7(1)(a) of the CGST/KGST Act, 2017 since the activity is between two or more departments of same Govt. of Karnataka and hence there is no distinct supplier/recipient, either real or deemed, involved in the transactions, but when supplied to Govt. departments registered under the Act they are taxable supplies attracting GST @12% under SAC 9989, Entry no. 27 of 11/2017-CTR; printing and supply of answer booklets, visiting cards, letter heads, forms, covers, file wrappers, invitation cards, scribbling pads, rubber stamps is supply of goods taxable @18% under HSN 4817 Entry 152, 154 of Schedule III of 1/2017-CTR when supplied to Govt. departments registered under the Act and exempted when supplied to govt. departments, not registered; printing and supply of Annual reports to autonomous bodies is a service attracting GST @12%, SAC 9989, 11/2017-CTR, Supply of log books, GST @18%, HSN 4820, 1/2017-CTR; Printing and supply of law reports to Karnataka High Court is supply of service, exempted as transaction does not qualify as supply u/s 7(1)(a) of Act, 2017; printing and supply of bus tickets to BMTC is a service taxable under GST @ 12%, SAC 9989, Entry 27, 11/2017-CTR: AAR
- Application disposed of: AAR
2020-TIOL-57-AAR-GST
Water Health India Pvt Ltd
GST - Applicant is engaged in the business of supplying purified water in unsealed form by filling customer supplied empty cans; in 20 litre unsealed cans and through piped network to establishments - applicant seeks to know as to whether such supply is exempted under GST law.
Held: Word 'and' used before the words "water sold in sealed container" in Sl. no. 99 of notification 2/2017-CTR is disjunctive in nature and lays down that "water sold in a sealed container" is another type of water excluded from the said entry along with aerated water, mineral water, purified water, distilled water, medicinal water, ionic water, battery water, demineralised water - therefore, supply of purified water in sealed or unsealed container is not entitled for GST exemption as the purified water is excluded from Sl. no. 99 of 2/2017-CTR - therefore, supply of 'purified drinking water' to the general public in an unsealed container is not entitled for exemption from GST under the impugned notification: AAR
- Application disposed of: AAR
2020-TIOL-56-AAR-GST
Kardex India Storage Solution Pvt Ltd
GST - Applicant is the importer of storage solutions and vertical storage solutions from Germany and distributes the goods to industrial customers all over India - they are transporting the imported goods from port of import to applicants' registered premises at Bangalore and then supplying same to customers place - due to logistical problems encountered, the applicant intends to import the goods to the port nearest to the customers place and supply it directly to the customer - they intend to issue bill/tax invoice for said transaction from the registered place of business - in view thereof, they seeks an advance ruling as to whether they can take credit of IGST paid on import of goods; whether applicant can issue tax invoice with IGST to the customers and whether the applicant needs to obtain registration in the state where the port of clearance is located.
Held: Applicant is eligible to claim credit of IGST paid on import of goods as per s.20 of the IGST Act r/w s.16 of CGST Act - they can issue tax invoice with IGST to customer as per s.20 of IGST Act r/w s.31 of the CGST Act for the interstate transaction as provided u/s 7(1) of the IGST Act when the goods are directly despatched from port of import with invoicing done from registered place of business - applicant need not obtain registration in the State where the port of clearance is located if he is not making any supply from the State in which the port is located: AAR
- Application disposed of: AAR
2020-TIOL-55-AAR-GST
Karnataka Solar Power Development Corporation Ltd
GST - Applicant obtained lands on lease basis from farmers of five villages for a period of 28 years and sublet the same to the Solar Power Developers (SPD) to install the solar panels for generation of solar power - after commissioning of solar projects, an amount of Rs.5 lakhs per MW is required to be collected in five equal yearly instalments from SPDs towards Local Area Development Fund intended to rehabilitate the affected area - applicant seeks to know as to whether such amount collected can be treated as not a supply and not leviable to tax.
Held: Amount collected by applicant towards Local Area Development Fund forms part of value of supply of rental/leasing service and hence is taxable under forward charge mechanism, taxable under SAC 997212; exemption under Sl. no. 3 or 3A of 12/2017-CTR is unavailable as the service does not qualify as 'pure service': AAR
- Application disposed of: AAR
2020-TIOL-54-AAR-GST
Optm Health Care Pvt Ltd
GST - Applicant is stated to be providing a form of treatment called ‘Phytotherapy' to cure osteoarthritis and disorders of similar nature and seeks a ruling as to whether the service is exempted under serial no. 74 of 12/2017-CTR; and whether it should continue to stay registered under the Act.
Held: Applicant's submissions do not clarify or claim that its plant-based preparations are manufactured exclusively in accordance with the formulae prescribed in any authoritative book of Ayurveda specified in the first Schedule of the Drugs and Cosmetics Act, 1940 - It also does not claim that the persons administering the plant-based preparations are ‘authorised medical practitioners' in Ayurveda within the meaning of para no. 2(k) of the exemption notification 12/2017-CTR - applicant has also not clarified as to whether these persons possess the medical qualification included in the Second Schedule of the Indian Medicine Central Council Act, 1970 and registered under the said Act as medical practitioners - Authority cannot, therefore, accept the applicant's claim that it is a clinical establishment offering treatment in the recognised Ayurvedic system of medicine - Therefore, its supplies are not, healthcare service by a clinical establishment as defined in para 2(s) of the exemption notification - consequently, applicant's supply is not exempt under Entry no. 74 of 12/2017-CTR - applicant, therefore, needs to remain registered as its liability to pay GST does not cease: AAR
- Application disposed of :AUTHORITY FOR ADVANCE RULING
2020-TIOL-53-AAR-GST
ABB India Ltd
GST - Applicant is engaged in the activity of providing technological and system solutions, including electrification, industrial automation motion and robotics, data management and production control systems - Rail Vikas Nigam Ltd. has awarded it a contract for ‘extension of SCADA for Noapara-Dakshineswar Metro Corridor' - applicant seeks a ruling as to whether Entry 3(v) of 11/2017-CTR is applicable for its supply to RVNL by way of erection, commissioning, installation, completion etc. of SCADA system.
Held: Applicant's supply amounts to erection and commissioning of an immovable property involving transfer of property in goods in its execution and, therefore, Works Contract within the meaning of s.2(119) of the GST Act - Applicant's supply is not in the nature of repair and maintenance of an existing structure, but a new construction, hence it is ‘original work' within the meaning of clause 2(zc) of 12/2017-CTR - Supply is pertaining to railways, including metro, as defined in s.2(31)(c) of the Railways Act, 1989 - To conclude, Applicant is making a composite supply of Works Contract taxable under Entry no. 3(v)(a) of 11/2017-CTR being erection, commissioning and installation of original work pertaining to railways, including metro : AAR
- Application disposed of :AUTHORITY FOR ADVANCE RULING
2020-TIOL-52-AAR-GST
Fom Aluminium Machines Pvt Ltd
GST - Applicant states that they are importers and traders of Aluminium working machinery; that they import machines from their parent company in Italy and market the same in the domestic area; that they have only one office in Peena, Bangalore, India and that they are engaged in sales, service and Admn. Personnel to run business - they seek a ruling as to whether their export of services attract IGST under RCM, whether their services are Intermediary services, whether IGST paid under RCM is eligible to ITC, whether there is a provision in GST returns to show the transactions and that they are not collecting IGST from their customers and the same is absorbed as cost-impact on the transaction value.
Held: In the instant case, the applicant is, undoubtedly, a supplier and hence the question of levy of IGST on export of services, under RCM does not arise; from the Agency agreement, it is evident that the applicant is the sole agent of their parent company for the SAARC area and gets commission for their sale orders and, therefore, the applicant is an agent of the parent company and, hence, the supply of services of the applicant squarely falls under the Intermediary service and the supply in the taxable territory is taxable under forward charge mechanism; IGST paid on clearance of imported goods is available as ITC to the applicant - in the instant case as the applicant is not importing any services and hence payment of IGST under RCM does not arise - other questions are not covered under the purview of s.97(2) of the Act and hence no rulings are given on the same: AAR
- Application disposed of: AAR
2020-TIOL-51-AAR-GST
Karnataka State Electronics Development Corporation Ltd
GST - Street lighting activity under the Energy Performance Contract amounts to composite supply where the principal supply is that of supply of goods - rate of tax applicable is @ 12% in terms of Sl. no. 226 of Schedule II to 1/2017-CTR - as the impugned supply is not a pure service, applicant is not entitled to the benefit of exemption under Entry 3 or 3A of Notification 12/2017-CTR - time of supply is the date of invoice and the consideration is equal to the value of invoice, the GST rate being 12%: AAR
- Application disposed of: AAR
2020-TIOL-50-AAR-GST
Vikram Traders
GST - Applicant has sought advance ruling in respect of 'eligibility to claim ITC on inputs attributable to the renting of immovable property' - Section 17(5)(c) & (d) of CGST Act, 2017 - Safari Retreats Pvt. Ltd. Orissa High Court [2019-TIOL-1088-HC-ORISSA-GST] - As the issue is pending before the Supreme Court of India, in department appeal SLP no. 26696/2019 [2019-TIOL-489-SC-GST], the matter is sub-juice, hence application filed seeking a ruling on the subject matter cannot be entertained in view of s.97(2) of the Act, 2017 - application rejected in terms of s.98(2) of the Act: AAR
- Application rejected: AAR
AAAR CASES
GST - The appellant is developing a Shopping Mall, which is to include a hypermarket, multiplex cinema theatre, departmental stores, retail shops and food courts - The applicant entered into various lease agreements with customers and tenants and would be leasing all units at the mall together with the right to use the staircases, common areas and other common facilities - For development of the property, the applicant is required to procure various numerous goods and services, including works contract services, for which invoices were raised upon the applicant - The applicant approached the AAR seeking to know if tax paid on procurement of goods and services for installation of several mechanisms are to be regarded as blocked credits u/s 17(5) of the CGST Act - The AAR held that the taxes paid on procureent of goods and services for installation of the various machinery are regarded as blocked credits u/s 17(5) of the Act - Hence the present appeal against such findings.
Held - The restriction contained in Section 17(5)(d) is applicable to goods and services received by a taxable person for construction of an immovable property - When goods and services are received by a taxable person for construction of plant and machinery, there is no bar on eligibility to ITC - The appellant is not eligible for ITC of tax paid on procurement and installation of chiller, air handling unit, CCTV system, electrical wiring and fixtures, public health engineering, fire fighting and water management pump system as these items do not qualify as plant and machinery - Moreover, the appellant is not eligible for credit of tax paid on procurement and installation of lift and escalator, since the appellant is not primarily engaged in the installation of lifts, escalators and travellators - Similarly, the appellant is not eligible for ITC of tax paid on procurement and installation of car parking system as the same is not the primary function of the appellant - Hence the order of the AAR does not warrant any interference with: AAAR
- Appeal dismissed : APPELLATE AUTHORITY FOR ADVANCE RULING
GST - T he appellant is a department functioning under the State Government of Karnataka - Its sovereign functions include raising plants of various tree species, planting the same in forests, waste and common lands - Over time when the trees grow, they are harvested to yield timber, poles, billet, firewood, pulpwood used by various industries - The task of harvesting the trees is given to various Govt corporations - The appellant had approached the AAR seeking to know if it was legally correct to infer that the entire service of logging and is components did not attract GST - It also sought to know whether in case of plants growing by natural regeneration, nil rate of SGST and CGST would be attracted - It also sought to know if forest produce is sold to buyer outside the state of Karnataka, what would be the rate charges under CGST/SGST and IGST - It also sought to know the rate of tax applicable if the goods were used within the State of Karnataka, by a buyer based outside the state - The AAR held that the operation of logging would attract tax under the GST Act irrespective of the trees grown by the Department and those growing naturally - It also held that the sale of the goods to a buyer located outside Karnataka constituted an intra-State supply irrespective of where the goods were taken once the supply is completed.
Held - The Appellate Authority is a creature of the statute and is empowered to condone delay of only a period of 30 days after the expiry of the initial period for filing appeal - The language of Section 100 emphasizes on the phrase not exceeding thirty days - If the Appellate Authority entertains an appeal beyond such period, the provisions of Section 100 including the phrase therein would be rendered otiose - hence the appeal is dismissed on account of it being filed beyond limitation: AAAR
- Appeal dismissed : APPELLATE AUTHORITY FOR ADVANCE RULING
NAA CASE
2020-TIOL-16-NAA-GST
Director General Of Anti-Profiteering Vs Patanjali Ayurveda Ltd
GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Period 15.11.2017 to 31.03.2019 - GST on goods manufactured by respondent was reduced from 28% to 18% and 18% to 12% w.e.f 15.11.2017 - DGAP in its report dated 13.12.2018 had stated that the respondent had not passed on the benefit of reduction in the tax rates to its recipients by way of commensurate reduction in prices and thus contravened the provisions of s.171 of the Act - Authority, after considering the submissions of the respondents had found discrepancies in the report of the DGAP and had, therefore, vide its order dated 14.03.2019 directed the DGAP to again conduct a detailed investigation into the matter after consideration of the submissions made by the respondent - DGAP has submitted a report on 13.09.2019 and concluded therein that the respondent had profiteered by an amount of Rs.1,03,20,08,903/- by comparing the actual invoice-wise based prices of impacted products sold during the period 15.11.2017 to 31.03.2019 - the respondent inter alia submitted that the DGAP had an incorrect understanding of the provisions of s.171 of the Act and had followed an incorrect approach to calculate the alleged profiteering - they also pin-pointed the instances where the profiteered amount was wrongly calculated by the DGAP - this submission of the respondent was also forwarded to the DGAP for its report and another report dated 06.01.2020 was submitted by the DGAP correcting the arithmetical mistakes etc. and arriving at the revised profiteered amount figure as Rs.75,08,64,019/- - respondent also made their submissions on this revised computation on 10.02.2020.
Held: Allegations made by the respondent regarding the unconstitutionality of the Authority inasmuch as there being no Judicial Member on the Bench is wrong as the Authority has been constituted u/s 171(2) of the CGST Act, 2017 - The Parliament, State Legislatures, the Central and State Governments and the GST Council in their wisdom have not thought it fit to provide for a Judicial Member in this Authority and such a Member has also not been provided in the other Authorities such as the TRAI or the Authorities on Advance Rulings on the CEX and the GST, hence allegations made by respondent regarding the unconstitutionality of the Authority are wrong - Computation of the commensurate reduction in prices is purely a mathematical exercise which is based on certain parameters and hence it would vary from SKU to SKU or unit to unit and hence no fixed methodology can be prescribed to determine the amount of benefit which a supplier is required to pass on to a recipient or for computation of the profiteered amount - respondent was not legally required to collect the excess GST and, therefore, he has not only violated the provisions of the CGST Act but has also acted in contravention of the provisions of s.171(1) of the Act as he has denied the benefit of tax reduction to recipients by charging excess GST - any benefit of tax rate reduction passed on to a particular recipient or customer cannot be appropriated or adjusted against the benefit of tax rate reduction due to another recipient or customer, hence the methodology of ‘netting off' cannot be applied in the present case as customers have to be considered as individual beneficiaries and cannot be compared with dumped goods and netted off - contention of the respondent that the profiteered amount should not be credited to the Consumer Welfare Fund but should be given back to his customers is not sustainable as in the instant case, it is not possible to trace each and every consumer of the product which is manufactured by the respondent, therefore, to prove the legislative intent of the law the profiteered amount must be used for the welfare of the consumers and must be deposited in the Consumer Welfare Fund in the absence of passing on the benefit to the actual consumers of the products - respondent cannot claim protection under Article 14 when he has violated the above Article himself by denying the benefit of tax reduction to millions of customers - contention of the respondent that the investigation is violative of Article 19(1)(g) of the Constitution is also untenable as the Authority or the DGAP has not acted in any way as a price controller or regulator as they do not have the mandate to regulate the same - Authority has only been mandated to ensure that both the benefit of tax reduction and ITC which are sacrifices of precious tax revenue made from the kitty of the Central and State Governments are passed on to the end consumers who bear the burden of tax - intent of this provision is the welfare of the consumers who are voiceless, unorganised and vulnerable and the Authority is entrusted with the responsibility of ensuring that both the above benefits are passed on to the general public as per the provisions of s.171 read with rule 127 and 133 of the Rules - Authority has nowhere interfered with the business decisions of the respondent and, therefore, there is no violation of Article 19(1)(g) of the Constitution - based on the above facts, the profiteered amount is determined as Rs.75,08,64,019/- as per the provisions of rule 133(1) of the Rules as computed vide the revised report dated 06.01.2020 - respondent is directed to deposit the said amount in the Consumer Welfare Fund of the Central and State Governments concerned as the recipients are not identifiable, as per the provisions of rule 133(3)(c) of the Rules along with 18% interest within a period of three months - on account of the above contravention, the respondent is liable to be imposed with penalty in terms of s.171(3A) of the Act and in which regard a show cause notice is required to be issued - Commissioners of CGST/SGST are directed, in terms of rule 136 of the Rules, to monitor this order under supervision of the DGAP and ensure that the profiteered amount is deposited in the CWFs as directed and a compliance report is to be submitted within four months: NAA
- Application disposed of: NAA
ARTICLES
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GST - An agenda for reforms - Part - 78 - GST reforms in times of grave crisis
E-assessment in Customs: A primer
GST - An agenda for reforms - Part - 77 - GST Council meeting - Furthering reforms
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