TOP NEWS

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GST CASES

HIGH COURT CASES

2020-TIOL-1122-HC-AP-GST

Sany Heavy Industry India Pvt Ltd Vs STO

GST - The assessee-company is engaged in manufacturing heavy equipment such as Hydraulic Excavators, Concrete Machinery, Mining Machinery, Crawler Excavator, Truck Crane - In the relevant period, it entered into a Machine Demo Activity Agreement for demonstration and evaluation of Hydraulic Excavator, for 45 days and on returnable basis - The petitioner loaded the single machinery and raised a returnable challan in the name of the company to whom the machine was being sent - The bill to ship was addressed to its Head Office - Later owing to an error, the address for delivery of the goods was shown to be a different city - Such error was also made in the e-way bill - The driver was instructed to proceed to the correct destination - Subsequently, the consignment was intercepted by the STO concerned, who checked the necessary papers & detained the consignment - Form GST MOV 07 was issued to the driver and demand for IGST was raised along with equivalent amount of penalty - Hence the present writ.

Held - The petitioner had raised the issue of the tax liability on the transaction - According to the petitioner, the tax liability had not even arisen - Since there was no taxable event, which had occurred, the question of having to pay the tax would not arise - Despite the fact that the said contention was raised by the petitioner, the STO has failed to deal with the said contention - Moreover, the STO has not even assigned any reason for ignoring the said contention - Therefore, the order is clearly a non-speaking order, as the material contention has been totally ignored by the STO - Since the order is a non-speaking one, there is no other option, except to set aside the said order and to remand the case back to the STO with a direction to consider the arguments raised by both sides and to pass a reasoned order, within a period of one month from the date of receipt of a certified copy of this order: HC

- Writ petition disposed of: TELANGANA HIGH COURT

2020-TIOL-1118-HC-AHM-GST

Mahavir Enterprise Vs ACST

GST - It is the case of the department that the writ applicant is involved in bogus billing transactions without any physical movement of the goods -Writ application filed praying to declare the Rule 142(1)(a) of CGST/GGST Rules, being ultra vires and dehors the Act and violative of Articles 14 and 19(1)(g) of the Constitution of India, to the extent it says notice issued under section 122 - Writ applicant seeks to challenge the legality and validity of the show cause notice dated 30th November 2019 issued by the respondent No.1 under Section 122(1) of the Act calling upon the writ applicant to show cause why an amount of Rs.6,87,68,821/- should not be recovered for the alleged contravention of the provisions of the Act and the Rules.

Held: SCN is yet to be adjudicated - It also needs to be stated at this stage that there is also a challenge to the constitutional validity of Rule 142(1)(a) of the CGST Rules on the ground that the same travels beyond the provisions of the Act and is a result of excessive delegation of powers -Bench does not propose to enter into the merits of the allegations levelled against the writ applicant as regards bogus billing transactions without there being any physical movement of the goods as the matter is at the stage of a show cause notice - Bench only proposes to consider whether the impugned show cause could be termed as per se without jurisdiction and a nullity and the validity of Rule 142(1)(a) of the Rules - Insofar as scope of judicial review, against the show cause notice, is concerned, in the case of Standard Chartered Bank and others vs. Directorate of Enforcement and others = 2006-TIOL-16-SC-FERA-LB , it is held that ordinarily the Court should be reluctant to interfere with the show cause notice unless the notice is shown to have been issued apparently without any authority of law - High Court can interfere under Article 226 of the Constitution of India against a show cause notice where the same is issued by an authority in exercise of the power which is absent; the facts does not lead to commission of any offence; the show cause notice is otherwise without jurisdiction; it suffers from incurable infirmity; against the settled judicial decisions or the decisions of the Tribunal and bereft of material particulars justifying commission of offence - A rule under delegated legislation can be held to be ultra vires the statutory provisions of the Act if it is shown (i) that it is beyond the scope of or in excess of the rulemaking power of the delegate conferred under the Act, or (ii) that it is in conflict with or repugnant to any enactment in the Act - It may be noted that Section 164 of the Act confers power on the Central Government to frame the rules - Under Section 164 of the Act, the Central Government has the power to make rules generally to carry out all or any of the purposes of the Act - In the opinion of the Bench, Rule 142(1)(a) of the Rules, 2017 is valid and is in no manner conflict with any of the provisions of the Act - The challenge to the legality and validity of the show cause should fail having regard to the scope of judicial review and the challenge to the validity of Rule 142(1)(a) of the Rules should also fail - Writ application fails and is hereby rejected: High Court [para 19, 20, 22, 25, 28 to 31]

- Application rejected: GUJARAT HIGH COURT

2020-TIOL-1117-HC-AHM-GST

Shri Durga Traders Vs STO

GST - Petition filed seeking issuance of writ of mandamus directing respondent No.01 to immediately release conveyance / vehicle bearing No.MP 69 H 0130 along with the goods i.e. groundnuts loaded in the same - It appears that on 4th June 2020, the writ applicant herein came to be served with a notice for confiscation of goods as well as the conveyance in form GST MOV-10 and date of hearing of the show cause notice issued in form GST MOV-10 has been fixed today i.e. on 19th June 2020.

Held: Bench does not propose to go into the merits of the matter as it is of the view that the authority concerned should be allowed to continue with the adjudication of the show cause notice issued under Section 130 of the Act - However, as the goods being groundnuts are perishable in nature, Bench directs the writ applicant to deposit an amount of Rs.54,000/- towards tax and penalty and the balance amount of Rs.5,67,000/- shall be by way of a bank guarantee of any nationalized bank; that on deposit of Rs.54,000/- and furnishing of the bank guarantee of the balance amount, the authority concerned shall immediately release the goods as well as the conveyance - confiscation proceedings shall proceed further on its own merits in accordance with law - writ application stands disposed of: High Court [para 5, 6]

- Petition disposed of: GUJARAT HIGH COURT

2020-TIOL-1116-HC-DEL-GST

Shriniwas Tin Industries Pvt Ltd Vs UoI

GST - Petition has been filed seeking a direction to the respondents to allow the petitioner to carry forward in its electronic credit ledger the credit of eligible dues in respect of stock available with the petitioner as on appointed day i.e. 30th June 2017 and to declare Rule 117 of CGST Rules as ultra vires of Sections 140 and 174 of the CGST Act, 2017; that the retrospective amendment made in Section 140(1) w.e.f. 01st July, 2017 is illegal and arbitrary.

Held: Counter-affidavits to be filed within four weeks and rejoinder-affidavit, if any, to be filed within four weeks thereafter - To await the judgment of the Supreme Court in Union of India Vs. Brand Equity Treaties Limited & Ors., SLP (C) 7425-7428/2020 = 2020-TIOL-115-SC-GST-LB, list on 16th September, 2020: High Court

- Matter listed: DELHI HIGH COURT

2020-TIOL-1110-HC-DEL-GST

Rehau Polymers Pvt Ltd Vs UoI

GST - Petitioner has sought a direction to the respondents to open the GST portal to enable the petitioner to upload the GST Tran-1 Form - They have placed reliance on the decision of this Court in Brand Equity Treaties Limited - 2020-TIOL-900-HC-DEL-GST - Admittedly, that decision in Brand Equity Treaties Limited (supra) is pending consideration before the Supreme Court and the operation of the said decision has been stayed by the Supreme Court - submission of petitioner is that, even in these circumstances, this Court may permit provisional manual filing of the GST Tran-1 Form in terms of Court's decision in Brand Equity Treaties Limited (supra); that in case the Supreme Court upholds the decision of this Court in Brand Equity Treaties Limited (supra), the respondents should not be permitted to present a fait accompli by pleading that 30th June, 2020 has already passed.

Held: Bench is not inclined to pass any such direction as sought by the petitioner - However, considering the fact that the petitioner has approached this Court by filing the writ petition before 30.06.2020 and which has been listed on 30.06.2020, in case the Special Leave Petition preferred by the respondents before the Supreme Court against the decision in Brand Equity Treaties Limited (supra) is rejected, and this Court's decision is upheld, it goes without saying that this Court would not be powerless to direct the respondents to accept the GST Tran-1 Form of the petitioner at a later point of time – Matter is to be listed on 16.09.2020 along with other similar matters: High Court

-Matter listed :DELHI HIGH COURT

2020-TIOL-1120-HC-MAD-GST

KM Tiles Vs State Tax Officer

GST - Respondent has recognized that the petitioner is entitled for a refund of excess amount of Rs.13,38,958/-, which was sought to be denied vide the impugned order as transitional credit - Petitioner submits that since the transitional credit, which has been now allowed by way of refund has already been adjusted by the petitioner, the respondent may be directed to give credit and adjust the same as otherwise they may take steps to demand interest under Section 50 of the said Act.

Held: Question of payment of interest by the petitioner under Section 50 of the said Act, does not arise as the said amount is sought to be refunded - the writ petition is, therefore, liable to be closed - petition is disposed of: High Court [para 5]

- Petition disposed of : MADRAS HIGH COURT

2020-TIOL-1109-HC-KOL-GST

Subhas And Company Vs CCGST

GST - The petitioner is a dealer registered under the WB VAT Act, who later migrated to the GST regime and became a registered dealer under the CGST Act and the WBGST Act - The petitioner filed the present writ, having raised the point as to whether non-allowance of transitional Credit on account of inputs held in stock as on the appointed date under Section 140(3) of the CGST/SGST Act, 2017 due to inability to file GST TRAN-2 before the due date as provided for in Rule 117 (4) of the CGST/SGST Rules, 2017 is violative of Articles 14, 19(1) (g) and 265 of the Constitution of India and is grossly against the principles of natural justice and whether the petitioner is entitled to get an opportunity to file the declaration in CGST TRAN –2 in order to be allowed to take transitional Credit on account of inputs held in stock as on the appointed date.

Held - In the decision of the High Court in M/s. Blue Bird Pure Pvt. Ltd. vs. Union of India, it is observed that Government has acknowledged that on account of technical difficulties, the tax payers were indeed unable to file the statutory form within time and CBIC vide notification issued from time to time, extended the date prescribed for filing of form GST TRANI under Rule 117(1A) of the CGST Rules and the period, as on date, was extended by various notifications reference is also made in unreported decision of the High Court of Delhi in Brand Equity Treaties Limited vs. The Union of India & Ors. wherein it has been specifically observed in paragraph 22 that the provision (Rule 117) as being directory in nature, insofar as it prescribes the time-limit for transitioning of credit and therefore, the same would not result in the forfeiture of the rights, in case the credit is not availed within the period prescribed - However, this cannot be taken to mean that availing of CENVAT credit can be in perpetuity - Transitory provisions have to be given its due meaning - Transition from pre-GST Regime to GST Regime has not been smooth and therefore, what was reasonable in ideal circumstances is not in the current situation. In absence of any specific provisions under the Act, we would have to hold that in terms of the residuary provisions of the Limitation Act, the period of three years should be the guiding principle and thus a period of three years from the appointed date would be the maximum period for availing of such credit. The petitioner has attempted to file TRAN within the time limit framed under the Rule - Hence the authorities concerned are directed to reopen the form TRAN II or accept manual filing of GST TRAN II to allow the petitioner to claim transitional credit held in stock as on the appointed date after proper verification including the invoices submitted by the petitioner: HC

- Writ petition allowed: CALCUTTA HIGH COURT

2020-TIOL-1108-HC-DEL-GST

Sharda Chemicals Vs UoI

GST - The petitioner sought that directions be issued to the Revenue authorities concerned to open the GST portal so that the petitioner could upload the GST Tran-I Form.

Held - The decision of this court in Brand Equity Treaties Limited Vs. The Union of India & Ors. is pending consideration before the Supreme Court, which stayed the decision - Directions were also issued to the authorities concerned to re-open the GST portal so that ll those who were not able to upload the GST Tran-I Form could do so by 30.06.2020 - Notice issued to the relevant authorities - Matter adjourned to 30.06.2020: HC

- Writ petition disposed of: DELHI HIGH COURT

2020-TIOL-1106-HC-DEL-GST

Watermelon Management Services Pvt Ltd Vs CCT

GST - Petition has been filed challenging the impugned order dated 03rd June, 2020 passed by respondent No.1 whereby it has kept the provisional attachment orders dated 05th March, 2020 as well as corrigendum dated 01st June, 2020 alive after specifying that the reason for attachment was that proceeding under Section 67 of the CGST Act, 2017 was pending against the petitioner - However, the respondent No.1 accepted the fact that it should not conduct parallel investigation and accordingly, the respondent No.1 handed over its investigation to Directorate General of Goods and Services Tax Intelligence (DGGI) who had been investigating the matter since 05th December, 2018 - Petitioner points out that though the DGGI was investigating the matter since 05th December, 2018, yet he had never passed any attachment/freezing order against the petitioner; that since no proceeding had been launched under Section 74 of the CGST Act and the raid and search of the petitioner's premises had concluded on 04th and 05th March, 2020, the impugned provisional attachment order is without jurisdiction and illegal - Respondent states that the petitioner has maintained no record of transaction undertaken during the Financial Years 2017-18 and 2018-19; that the petitioner has not provided any evidence of genuineness of Input Tax Credit (ITC) availed by it and/or eight other companies; that the Directors of the petitioner have failed to comply with summons issued to them - During the hearing, Officer from the DGGI office stated that though fifteen summons had been issued to the Director of the petitioner, yet he had appeared only on three occasions and that too did not furnish the documents as asked for - petitioner states that documents in three tempos have been filed by the petitioner with the DGGI.

Held: Keeping in view the serious allegations that have been levelled against the petitioner by the officers of DGGI as well as by the Commissioner of CGST, Delhi (East), Court is of the view that ends of justice would be met if the DGGI is directed to conclude the investigation in the present case within a period of three months - if upon conclusion of investigation, DGGI is satisfied with the stand of the petitioner, then it shall close the proceeding and if not, issue an appropriate show cause notice in accordance with law - Petition is disposed of: High Court [para 8, 9]

- Petition disposed of: DELHI HIGH COURT

2020-TIOL-1102-HC-P&H-GST

Ceamen Electronics Vs UoI

GST - Petitioner challenges vires of Rule 117(1A) of CGST Act, 2017 and seeks direction to Respondent to permit Petitioner to electronically upload form TRAN-1 in order to avail credit of excess VAT reflected in Returns, as due to technical glitches on the GST Portal, the petitioner could not file Form TRAN-I - Petitioner contends that issue involved is squarely covered by judgment of this Court in the case of Adfert Technologies Pvt. Ltd. - 2019-TIOL-2519-HC-P&H-GST, SLP filed by Revenue against aforesaid decision havine been dismissed - Petitioner also submits that Delhi High Court in the case of Brand Equity Treaties Ltd. 2020-TIOL-900-HC-Del-GST has permitted Petitioners to file TRAN-I on or before 30.06.2020 and further directed the Respondents Revenue to permit all other similarly situated tax payers to file TRAN-I on or before 30.06.2020; that this opinion has been approved in SKH Sheet Metals Components - 2020-TIOL-1031-HC-DEL-GST.

Held: Delhi High Court though has not declared Rule 117(1A) ultra vires the Constitution, nonetheless treated as violative of Article 14 of Constitution of India being arbitrary, discriminatory and unreasonable - in the instant case, the Petitioner has challenged vires of Rule 117 (1A) of Rules, however Bench does not think it appropriate to declare it invalid as it is of the considered opinion that Petitioner is entitled to carry forward Cenvat Credit accrued under Central Excise Act, 1944 - Repeated extensions of last date to file TRAN-1 in case of technical glitches as understood by Respondent vindicate claim of the Petitioner that denial of unutilized credit to those dealers who are unable to furnish evidence of attempt to upload TRAN-1 would amount to violation of Article 14 as well Article 300A of the Constitution of India - In view of decision of this Court in the case of Adfert Technologies Pvt. Ltd. (supra) and Delhi High Court in the case of Brand Equity Treaties Ltd. (supra) present petition deserves to be allowed and is accordingly allowed - The Respondents are directed to permit Petitioner to upload TRAN-1 on or before 30.06.2020 and in case Respondent fails to do so, the Petitioner would be at liberty to avail ITC in question in GSTR-3B of July 2020 - respondents would be at liberty to verify genuineness of claim(s) made by Petitioner: High Court [para 7 to 9]

2020-TIOL-1100-HC-RAJ-GST

Uma Shankar Aggarwal Vs UoI

GST - Petitioner has filed bail application under Section 439 of Cr.P.C. – case has been registered for offence under Sections 132(1)(b)(c) r/w Section 132(1)(i) of the CGST Act, 2017 – case of the department is that petitioner has claimed input tax credit to the tune of Rs.11.6 crores without there being any transaction; that the vehicles in which goods stated to have been sent to the petitioner are pick-up, scooty and motorcycle etc. which clearly goes to show that fake bill entries were manipulated to claim input tax credit to the tune of Rs.11.6 crores.

Held: Considering the facts that claim of input tax credit without there being any transaction directly affects the economy of the country, petitioner has claimed input tax credit to the tune of Rs.11.6 crores, hence Bench is not inclined to entertain the bail application – Bail application is rejected: High Court [para 7, 8]

- Application rejected: RAJASTHAN HIGH COURT

2020-TIOL-1099-HC-DEL-GST

Weldmart International Vs UoI

GST - Petition filed seeking a direction to the respondents to allow the petitioner to carry forward in its electronic credit ledger the credit of eligible dues in respect of stock available with the petitioner as on appointed day i.e. 30th June 2017 and to declare Rules 117 and 120A of the CGST Rules, 2017 as ultra vires Sections 140 and 174 of CGST Act, 2017 - Petitioner also seeks a declaration that the retrospective amendment made in Section 140(1) w.e.f. 01st July, 2017 is illegal and arbitrary.

Held: Issue Notice - Counter-affidavits to be filed within four weeks and rejoinder-affidavit to be filed within four weeks thereafter - To await the judgment of the Supreme Court in Union of India Vs. Brand Equity Treaties Limited & Ors., SLP (C) 7425-7428/2020 - Matter listed on 16 th September 2020: High Court

- Matter listed: DELHI HIGH COURT

SS Automotive Pvt Ltd Vs UoI

GST - Petition filed seeking a direction to the respondents to allow the petitioner to carry forward in its electronic credit ledger the credit of eligible dues in respect of stock available with the petitioner as on appointed day i.e. 30th June 2017 and to declare Rules 117 and 120A of the CGST Rules, 2017 as ultra vires Sections 140 and 174 of CGST Act, 2017 - Petitioner also seeks a declaration that the retrospective amendment made in Section 140(1) w.e.f. 01st July, 2017 is illegal and arbitrary.

Held: Issue Notice - Counter-affidavits to be filed within four weeks and rejoinder-affidavit to be filed within four weeks thereafter - Matter listed on 16 th September 2020: High Court

- Matter listed: DELHI HIGH COURT

Ess Aar Automotive Pvt Ltd Vs UoI

GST - Petition filed seeking a direction to the respondents to allow the petitioner to carry forward in its electronic credit ledger the credit of eligible dues in respect of stock available with the petitioner as on appointed day i.e. 30th June 2017 and to declare Rules 117 and 120A of the CGST Rules, 2017 as ultra vires Sections 140 and 174 of CGST Act, 2017 - Petitioner also seeks a declaration that the retrospective amendment made in Section 140(1) w.e.f. 01st July, 2017 is illegal and arbitrary.

Held: Issue Notice - Counter-affidavits to be filed within four weeks and rejoinder-affidavit to be filed within four weeks thereafter - Matter listed on 16 th September 2020: High Court

- Matter listed: DELHI HIGH COURT

Alstone International Vs UoI

GST - Petition filed seeking a direction to the respondents to allow the petitioner to carry forward in its electronic credit ledger the credit of eligible dues in respect of stock available with the petitioner as on appointed day i.e. 30th June 2017 and to declare Rules 117 and 120A of the CGST Rules, 2017 as ultra vires Sections 140 and 174 of CGST Act, 2017 - Petitioner also seeks a declaration that the retrospective amendment made in Section 140(1) w.e.f. 01st July, 2017 is illegal and arbitrary.

Held: Issue Notice - Counter-affidavits to be filed within four weeks and rejoinder-affidavit to be filed within four weeks thereafter – Matter listed on 16 th September 2020: High Court

- Matter listed: DELHI HIGH COURT

2020-TIOL-1094-HC-KAR-GST

MS Retail Pvt Ltd Vs UoI

GST - Petitioner seeks quashing of the order of 'cancellation of registration' dated 06.06.2020 passed by respondent No.3-the Assistant Commissioner of Commercial Taxes, Bengaluru - Counsel for Revenue submitted that u/s 30 of the CGST Act, petitioner can approach appropriate authority seeking revocation of cancellation of registration and that if such an application is filed in a prescribed format, the authority shall examine the same and pass appropriate orders.

Held: Petition is disposed of by granting liberty to the petitioner to file necessary applications seeking revocation of cancellation of registration - If such application is submitted, respondent No.3 - the Assistant Commissioner of Commercial Taxes, Bengaluru, shall consider the same and pass appropriate orders, as expeditiously as possible and in any event, in an outer limit of two weeks: High Court [para 5]

- Petition disposed of: KARNATAKA HIGH COURT

2020-TIOL-1092-HC-DEL-GST

Phillips India Ltd Vs UoI

GST - s.171 of the CGST Act, 2017 - Petitioner challenges the order dated 19th May, 2020 - 2020-TIOL-27-NAA-GST passed by the National Anti-Profiteering Authority wherein it is held that the petitioner had profiteered by an amount of Rs.4,53,949/- on the sale of "food processor" and that the said amount is required to be deposited in the Consumer Welfare Fund within three months along with interest @18%; that the DGAP should also investigate into all the other impacted products which have been supplied by respondent and a detailed report is to be submitted u/r 133(5) of the CGST Rules, 2017.

Held: Notice issued - Petitioner is directed to deposit the amount of Rs.4,53,949/- within three months - The interest amount as well as penalty and further investigation with regard to other impacted products as well as the letter dated 11th June, 2020 issued by the Director General of Anti Profiteering are stayed till further orders – Matter is listed on 7 th September 2020: High Court

- Matter listed: DELHI HIGH COURT

AAR CASES

2020-TIOL-187-AAR-GST

Shilpa Medicare Ltd

GST - Business of the applicant Shilpa Medicare Limited of Andhra Pradesh unit, as a whole, along with the capital assets is being transferred as going concern to Shilpa Medicare Limited of Karnataka unit for a monetary consideration - In the instant case, the activity of the ‘transfer' is made for a consideration but neither in the course of the business nor for the furtherance of the business - Even though this transaction does not amount to a ‘supply' as per definition but qualifies to be one under the scope of ‘supply' as it is backed by the term ‘includes' in section 7(1) of the CGST Act, 2017 - In the instant case, the business in its entirety is transferred or sold along with capital assets and thus it disqualifies the ‘going concern' from being grouped under ‘supply of goods' as per clause 4(c) of Schedule II of the CGST Act, 2017 - definition of ‘services' qualifies ‘anything other than goods' as service - it is obvious that the 'going concern' which was excluded from the list of ‘supply of goods' would automatically fall under ‘supply of services' - In terms of Sl. no. 2 of Chapter 99 of 12/2017-CTR ‘services by way of transfer of a going concern, as a whole or an independent part thereof' is Nil rated, therefore, the transaction is not liable to tax: AAR

GST - As to whether the applicant can file GST ITC-02 return and transfer unutilized ITC from Vizianagaram, Andhra Pradesh to Bengaluru, Karnataka unit, section 18(3) of the Act read with rule 41 of the Rules, 2017, provides that in case of sale or transfer, the transferor can transfer unutilised input tax credit to the transferee, which is lying in his electronic credit ledger by filing Form GST ITC-02: AAR

- Application disposed of: AAR

2020-TIOL-186-AAR-GST

Pulluri Mining And Togistics Pvt Ltd

GST - Applicant is a service provider rendering support services relating to mining - Above works are carried out by using the listed heavy equipment and vehicles and the same are deployed for exclusive usage of the contract and shall not move out of the service recipient premises unless it is essential for performance of the contract - HSD Oil issued free of cost by the service recipient to the applicant for operating the above heavy equipment and vehicles would form part of the value of supply of service by the applicant as per s.15(2)(b) of the CGST Act, 2017: AAR

- Application disposed of: AAR

2020-TIOL-185-AAR-GST

Ocean Sparkle Ltd

GST - Tug Jupiter let out on rent to RIL by applicant - IGST on vessel charter hire charges classifiable under 9966 is in terms of Sl. no. 10 of 8/2017-ITR as amended by 1/2018-ITR and attracts tax rate of 5% subject to fulfilling conditions: AAR

- Application disposed of: AAR

2020-TIOL-184-AAR-GST

GVS Projects Pvt Ltd

GST - Applicant is engaged in the execution of works awarded by electricity companies M/s APEPDCL and M/s APSPDCL - such contracts entered by applicant falls under the Works Contract and is covered by entry no. 3(ii) of 11/2017-CTR as amended and applicable rate of tax is @18% and not the concessional rate of 12% since the works undertaken is for the companies who use it for business purpose - Value of materials recovered on cost recovery basis by the contractees from the R.A bills issued by the applicant is includible in the taxable value of supply in terms of s.15(2)(b) of the Act - reverse charge is not applicable to the goods issued by a contractee as seen from notification 13/2017-CTR, however the provisions of s.15 are applicable as mentioned: AAR

- Application disposed of: AAR

2020-TIOL-183-AAR-GST

DKV Enterprises Pvt Ltd

GST - Marketing and consultancy services supplied by applicant are not ‘export of service' but ‘intermediary services' as defined under clause 13 of section 2 of the IGST Act, 2017 - such Intermediary services are provided to the recipient located outside India and, therefore, the interstate provisions as contained in s.7(5)(c) of IGST Act shall be applicable and hence IGST is payable on such transaction: AAR

- Application disposed of: AAR

2020-TIOL-182-AAR-GST

Deccan Tobacco Company

GST - Tax applicable on tobacco leaves procured at tobacco auction platforms or directly from farmers which are cured and dried by farmers themselves is 5% as per 4/2017-CTR under ‘reverse charge': AAR

GST - If applicant purchases tobacco leaves from other dealers who have purchased them from farmers, the rate of tax is 5% as per Sl. no. 109 of Schedule I to 1/2017-CTR: AAR

GST - If the applicant segregates the tobacco into grades depending upon their size, colour/shade, length, texture and sells such graded tobacco leaf, the tax rate would be rate of tax is 5% as per Sl. no. 109 of Schedule I to 1/2017-CTR: AAR

GST - Rate of tax if the tobacco leaves are butted and sold to other dealers, the rate of tax is 5% as per Sl. no. 109 of Schedule I to 1/2017-CTR: AAR

GST - If the applicant gets the tobacco leaves re-dried, without getting them threshed, and sells them, the rate of tax is 5% as per Sl. no. 109 of Schedule I to 1/2017-CTR: AAR

GST - If the applicant gets the tobacco leaves threshed and re-dried, the rate of tax is 28% as per Sl. no. 13 of Schedule IV of 1/2017-CTR: AAR

GST - If the applicant gets the tobacco threshed and re-dried on job work basis at others' premises and then sells such threshed and re-dried tobacco leaves to others, the rate of tax is 28% as per Sl. no. 13 of Schedule IV of 1/2017-CTR: AAR

- Application disposed of: AAR

2020-TIOL-181-AAR-GST

DEC Infrastructure And Projects India Pvt Ltd

GST - Construction Work for APIIC namely, construction of building for office space/IT space at IT Park executed by the applicant is classifiable under SAC 9954 under Construction Services and attracts GST @18%, Sr. no. 3(ii) of 11/2017-CTR - applicant has not provided any information or documentary proof evidencing that the construction/building is for use other than for commerce, industry or any other business or profession so as to be eligible for concessional rate of 12% GST: AAR

- Application disposed of: AAR

2020-TIOL-180-AAR-GST

Consulting Engineers Group Ltd

GST - Project Management Consultancy services provided to Andhra Pradesh Panchayat Raj Engineering Department for AP Rural Road Project for road construction can be termed as ‘Pure services' and is eligible for exemption in terms of Sl. no.3, 12/2017-CTR: AAR

- Application disposed of: AAR

2020-TIOL-179-AAR-GST

CMC Vellore Association

GST - Supply of medicines to in-patients through pharmacy are not liable to tax, being a part of the composite supply of healthcare services [Heading 9993] - Entry no. 74 of Notification 12/2017-CTR refers - insofar as tax liability on the medicines, drugs, stents, implants etc. administered to in-patients during the medical treatment or procedure, the same is not liable to tax because supply of medicines and consumables are integral part of the treatment extended to the in-patients by the hospital - services rendered by the applicant is a composite supply as defined in s.2(30) of the Act in which the principal supply is healthcare, being predominant and the supply of medicines, drugs, implants, stents and other consumables come under ancillary supplies and accordingly tax liability has to be determined u/s 8 of the Act - moreover, since the entry ‘services by way of (a) healthcare services by a clinical establishment and authorised medical practitioner or para-medics', appearing at Sr. no. 74 of notification (supra), is Nil rated, the supply of medicines, drugs, implants, stents and other consumables are exempted from liability under GST: AAR

- Application disposed of: AAR

2020-TIOL-178-AAR-GST

Master Minds

GST - Applicant is an educational institution providing coaching to students for Chartered Accountancy Certificate, Cost and Works Accountancy Certificate and Intermediate certificate - such coaching enables the students to appear for the examinations conducted by the respective statutory bodies - applicant was initially registered with the service tax department under the category of ‘Commercial Training or Coaching Centre' and was paying service tax; however, pursuant to exemption notification 33/2011-ST, they stopped payment of service tax - demands were issued for recovery of service tax not paid on the fees collected by applicant, some of these demands were dropped (coaching for obtaining certificates of CA-Final, CA-Inter (IPCC) and ICWA-Final and Intermediate Course), others confirmed (coaching for CPT, CA-Foundation, ICWA-Foundation) - orders were accepted by the Committee of Chief Commissioners and in respect of matters where demands were confirmed, appeals were filed by the assessee before the CESTAT and the same are pending, in some cases, refund was also granted to the applicant of the service tax paid by them - applicant now desires to know as to whether the same exemption provided under the FA, 1994 is applicable to him under the GST law since identical exemption is/was provided under both the laws.

Held: Coaching or training provided by applicant is for preparing the students for writing/appearing for CA (Inter & Final) and ICWA (Inter & Final) exams conducted by ICAI/ICWAI - said coaching or training per se does not lead to grant of a certificate or diploma or degree or a qualification which is recognised by any law - It only aims at giving a better preparation to the students and improves their chances in the examination - It is similar to any other coaching or training given in respect of competitive/entrance examinations such as IIT, EAMCET etc. - Furthermore, such coaching or training as imparted by the applicant is neither mandatory nor sine qua non to the students appearing for the CA/ICWA examination - Students who prepare on their own can also appear for these examinations and qualify based on their performance, hence the coaching imparted by the applicant is only a facilitation/improvisation of the preparation for the said exams and cannot be considered as a coaching/training leading to grant of certificate, qualification etc. recognised by law - benefit of Entry no.66(a) of 12/2017-CTR is not available to applicant - services of provision of food and accommodation to students pursuing the said courses are liable to GST under the same notification 12/2017-CTR as amended since applicant has not qualified as an educational institute for entitlement to the exemption under Entry no. 14, 66(a) of 12/2017-CTR: AAR

- Application disposed of: AAR

2020-TIOL-177-AAR-GST

Halliburton Offshore Services Inc (Drill Bits)

GST - Import of drill bits for supply to ONGC at its location in India involves two supplies namely, import into India and indigenous movement from port of import to ONGC's location - Essentiality certificates are required in respect of import of drill bits into India under sr. no. 404 of 50/2017-Cus and another for indigenous movement under 3/2017-CTR: AAR

- Application disposed of: AAR

2020-TIOL-176-AAR-GST

Andhra Pradesh State Road Transport Corporation

GST - Applicant is renting the non-air conditioned buses for the occasion of marriages, functions etc.for transporting of employees and students of other organisations/departments, for transporting of passengers to Sabarimala, for transporting of public to meetings conducted by political parties and to placed like Polavaram project etc. - it is clear that the applicant is providing rental services and thus fits under Serial no. 10 of 11/2017-CTR - tax liability is 5%/12% subject to the satisfaction of the conditions of the respective entry to the notification else the tax rate would be 18%: AAR

GST - Question as to whether the applicant is required to file reconciliation statement in Form GSTR-9C cannot be answered as it does not fall under the scope of the authority mandated u/s 97(2) of the CGST Act, 2017: AAR

- Application disposed of: AAR

2020-TIOL-175-AAR-GST

Halliburton Offshore Services Inc (Oil India)

GST - It is clear and evident that the different components namely, technical personnel, technical equipment and additives/chemicals/consumables are separately available for procurement and supply by the applicant - Therefore, supply of mud additives and chemicals cannot be said to be supplied in 'conjunction with supply of services and supply of other goods' namely, technical equipment - Accordingly, supply of mud engineering services along with supply of imported mud chemicals and additives provided on consumption basis by applicant under the contract does not qualify as composite supply - Benefits referred under Customs Notification 50/2017-CTR is available to supply of such goods at the time of their importation subject to fulfilment of description, tariff item, lists and conditions specified therein and subject to the satisfaction of the proper officer: AAR

- Application disposed of: AAR

2020-TIOL-174-AAR-GST

Hazari Bagh Builders Pvt Ltd

GST - Rail Land Development Authority (RLDA) is not awarding industrial plots to applicant but a portion of land over which some residential infrastructures are meant to be built - An industrial plot is the one in which the developer is granted permission by competent authority (Central or State government) in reference to some scheme of development - These plots are for a specific purpose and if plot-holders in future tries to engage in some other work or lease conditions of agreement are breached, then the developer has every right to eject that plot-holder - RLDA is just providing a parcel of land which is in its ownership, therefore, the lease of the same cannot be categorised as meeting condition of industrial plot and for the purpose of financial business - RLDA has leased ordinary plots for residential purpose and consequently the conditions of the notification [Sr. no. 41 of 12/2017-CTR as amended] and read with Circular 101/20/2019-GST dated 30.04.2019 are not satisfied - Also, the entry no. 41B inserted in 12/2017-CTR by amending notification 04/2019-CTR is also not applicable as the notification clearly mentions that it will be applicable for upfront amount payable on or after 01.04.2019 but in the instant case the amount of  Rs.15,86,57,105/- was deposited by the applicant during the month of February 2019 which is prior to the applicable date of 01.04.2019  - Lease agreement between the applicant company i.e the lessee and RLDA for a period of 99 years is not exempted from levy of GST in view of notification(s) 04/2019-CTR, 12/2017-CTR - Such leasing services supplied by RLDA to applicant falls under HSN 997212 attracting GST @18% - Moreover, amount of Rs.15,86,57,105/- which is transferred by applicant/SPV in pursuance to the tender and lease agreement dated 08.11.2019 is not exempted under GST in view of  notification(s) 04/2019-CTR, 12/2017-CTR - this amount deposited during February 2019 is not exempted from GST by notification(s) 04/2019-CTR, 12/2017-CTR: AAR

- Application disposed of: AAR

2020-TIOL-173-AAR-GST

Springfields India Distilleries

GST - Applicant, a distillery, has sought a ruling on the classification of goods namely “Hand sanitisers” manufactured by them - They also wish to know as to whether Hand Sanitisers are classifiable as essential commodity and exempt from GST.

Held: Hand Sanitisers manufactured by the applicant are of the category of Alcobased hand sanitisers and are classifiable under heading 3808 of HSN to which rate of GST applicable is @18% - Furthermore, although the Ministry of Consumer Affairs, Food and Public Distribution have classified the hand sanitisers as essential commodity, exemption of goods from GST is available only if the same are exempted by notification 2/2017-CTR; that mere classification of goods as essential commodity is not a criteria for exempting them from leviability of GST: AAR

- Application disposed of: AAR

2020-TIOL-172-AAR-GST

High Tech Refrigeration And Air Conditioning Industries

GST - Whether the supply made by the applicant from Goa on behalf of a third person who is not in the taxable territory of Goa to a place in Goa is to be taxed as Inter State supply or intra state supply.

Held: Since the location of the supplier is Goa but goods are supplied on behalf of a registered person outside Goa to a place in Goa, the place of supply would be outside Goa as per section 10(1)(b) of the IGST Act - Nature of supply made by the applicant is to be treated as a supply of goods in the course of interstate trade or commerce and tax is to be charged accordingly: AAR

- Application disposed of: AAR

2020-TIOL-171-AAR-GST

Core Project Engineers And Consultants Pvt Ltd

GST - Applicant is providing Mapping services, purpose is to identify un-permitted construction areas, to various municipal corporations and councils - such services are covered under Article 243W of the Constitution as functions entrusted to the municipality, being pure services, are exempted in terms of Sl. no. 3 of 12/2017-CTR: AAR

- Application disposed of: AAR

2020-TIOL-170-AAR-GST

Isprava Hospitality Pvt Ltd

GST - Renting of Villa - Applicant is engaged in the activity of giving luxurious villa on rent to its clients in Goa and Tamil Nadu and intends to initiate the said business in Maharashtra - Each villa consist of two to six rooms and is offered to clients on a per day basis for entire villa - per day rent of an entire villa will be more than Rupees seven thousand five hundred at any given point of time, however, if one calculates the cost per room per villa, then it would be less than Rs.7500/- - Applicant, therefore, submits that they should be charged to GST @12% in terms of Entry no. 7(i) of 11/2017-CTR and not @18% in terms of Sl. 7(vi) which is chargeable only when the per unit accommodation exceeds Rs.7500- per unit.

Held: Villa, per se is ‘indivisible unit' in applicant's business parlance and the declared tariff is only for the villa as a whole - Two different clients are not allowed to book the same villa for the same period i.e. if the particular villa is booked by one client at a given date then another client will not be able to book the same villa on the same day - Hence, in the present case entire villa is to be treated as ‘per unit' as specified under Entry no. 7 of 11/2017-CTR; chargeable to GST @18%: AAR

- Application disposed of: AAR

2020-TIOL-169-AAR-GST

Saint-Gobain India Pvt Ltd

GST - Applicant seeks an advance ruling in respect of the following question viz. whether the proposed product is classifiable as ‘glass-fibre reinforced gypsum board' and the applicant can avail the benefit of the concessional rate of tax under Schedule II of 1/2017-CTR.

Held: Applicant has made technical submissions with respect to contents of the impugned product which they are intending to manufacture, however, they have not submitted any samples of the impugned product - In terms of s.97(2)(a) of the Act, questions may be raised by an applicant in respect of classification of goods, supply of which is being undertaken or proposed to be undertaken - To classify the impugned product, it is imperative that the samples of the same are produced before the Authority in order to enable the Authority to take a balanced view in the matter - in the absence of the same, Authority is not able to arrive at any conclusion inasmuch as its classification cannot be arrived at, at this stage - In view of the definition of ‘advance ruling' given in section 95(a) of the Act, for the purpose of applying for advance ruling, one must raise questions specified in sub-section (2) of section 97 or sub-section (1) of section 100 in relation to the supply of goods or services or both being undertaken or proposed to be undertaken - Thus, goods in respect of which supply is being undertaken or proposed to be undertaken should be existing - in the subject case, applicant has submitted that they are proposing to manufacture the impugned product which are presently not in existence, thus their application is also barred u/s 95 of the CGST Act, 2017 - application is not maintainable, hence rejected: AAR

- Application rejected: AAR

2020-TIOL-168-AAR-GST

Woodkraft India Ltd

GST - Questions raised by the applicant do not pertain to the activity being undertaken or proposed to be undertaken after the appointed day - questions posed are not maintainable under the provisions of s.95 of the CGST Act, 2017 - application is, therefore, rejected: AAR

- Application rejected: AAR

2020-TIOL-167-AAR-GST

CEAT Ltd

GST - Questions raised by the applicant viz. whether their dealer is required to reverse ITC proportionate to the reduction in the value of supply; whether the applicant can issue commercial credit note to its dealers for post sale discounts without charging GST, does not pertain to matter in respect of which an advance ruling can be sought under the CGST Act, therefore, the application is not maintainable: AAR

- Application rejected: AAR

2020-TIOL-166-AAR-GST

Apsara Cooperative Housing Society Ltd

GST - Applicant is a co-operative housing society registered under the Maharastra State Co-operative Societies Act, 1960 and formed by its members who are the shareholders - Activities carried out by the applicant for its members qualifies as "supply" under the definition of s.7 of the CGST Act, 2017 - contention made by applicant with regard to the principle of mutuality to establish their claim that the applicant society and its members are not a distinct entity is not tenable insofar as taxability in the GST regime is concerned - case laws cited by the applicant are distinguished - as regards the second query raised by the applicant as to whether they have correctly discharged the GST as per the illustrative copy of the invoice generated by the applicant is concerned, such a question does not pertain to any matter in respect of which an Advance ruling can be sought under the GST Act, hence the Authority does not have jurisdiction to pass any ruling on such matter; said question is not maintainable under the Act: AAR

- Application disposed of: AAR

2020-TIOL-165-AAR-GST

Johnson Lifts Pvt Ltd

GST - The applicant company is engaged in supply, erection and commissioning of elevators & escalators - It approached the AAR seeking to know whether a building which consists of more than one residential unit qualifies as a residential complex - It also sought to know whether one unit which is occupied by customers and other units occupied by various family members who are not dependent upon the customer, qualifies as single residential unit - It also sought to know the criteria for determining that a residential unit is a single residential unit as per Sr No 3 of Notfn No 11/2017-CT(R).

Held - The applicant has not furnished the details of supply made or intended to be supplied - They also stated to have not accepted such type of contract wherein the customer owning a single piece of land consisting of dwelling units for himself and family members and had required supply, erection and commission of lifts - Advance ruling can be given only in respect of supplied or intended to be made by the applicant based on the facts of such supply - Hence the applicant cannot be admitted where the details of transaction of supply on which advance ruling is sought, are not furnished: AAR

- Application dismissed: AAR

2020-TIOL-164-AAR-GST

Kavi Cut Tobacco

GST - The applicant company intends to manufacture and supply tobacco product - Raw dried tobacco leaves are purchased from wholesale dealers - The stems & dust are removed and then cured to prevent decay - Such tobacco is then cut into small pieces in a cutting machine which is packed in pouches/pottalams for purpose of retail sale in shops and then is sold under the brand name of the applicant - The applicant approached the AAR seeking to know the appropriate classification and applicable rate of compensation cess for such product.

Held - The product intended to manufactured by the applicant and supplied as Chewing Tobacco under the brand name Kavi Cut tobacco, is classifiabe under CTH 240 9910 as Chewing Tobacco - The applicable rate of compensation cess is provided under Sr No 26 of Notfn No 1/2017-Compensation Cess @ 160%: AAR

- Application disposed of: AAR

2020-TIOL-163-AAR-GST

Rajesh Rama Varma

GST - the applicant approached the AAR seeking to know whether the services provided by it to foreign client through the principal are treatable as export of service as the final service claimed by the principal qualifies as export of service - The applicant also sought to know as to whether where the services are treated as export of service would the applicant be eligible to claim taxes paid towards such export of services as refund - Whether the payment of fees received in Indian INR currency from the principal is to be treated as export remittance and also whether the applicant can raise invoices with IGST taxes instead of CGST + SGST for claiming refund.

Held - the services provided by the applicant to M/s doyen Systems Pvt Ltd qualifies as supply of service under CGST / TNGST Act and the applicant is liable to pay tax on such supply - The remaining questions raised by the applicant are not within the ambit of the authority u/s 97(2) and so do not merit being answered: AAR

- Application disposed of: AAR

2020-TIOL-162-AAR-GST

Tamil Nadu Generation And Distribution Corporation Ltd

GST - the applicant company is engaged in the generation & distribution of electricity - The applicant approached the AAR seeking to know the taxability of transactions entered into by it between TANGEDCO Ltd and TANTRASCO Ltd. - It also sought to know the applicability of GST on Deposit Contribution Works - The applicant also sought to know whether M/s TANGEDCO can be considered a Government Entity - The applicant also sought to know the applicability of GST on transmission charges for natural gas.

Held - GST is applicable on supply of operation & maintenance material used in regular day to day functions and on transfer of capital assets - GST is also leviabe to the deployment of employees to TANTRASCO as the same is supply of service - GST is not leviable on transactions of physical cash flow between companues and income such as transmission charge, scheduling and systems operation charges as the same are transaction in money - No ruling given on payment of long term open access transmission charges payable to TANTRASCO as the applicant is not the person supplying the service - Deposit Contribution Works is classifiable under SAC 99873 and is taxable @ 9% as per Sr No 25 of Notfn No 11/2017-CT(R) and 9% SGST - TANGEDCO qualifies as a Govt entity as per Notfn No 11/2017-CT(R) - Issue of applicability of GST on Transmission Charges billed by M/s GAIL is not admitted: AAR

- Application disposed of: AAR

2020-TIOL-161-AAR-GST

Inventaa Led Lights Pvt Ltd

GST - Supply of LED Stem (long bulb) i.e. Outdoor lighting fixtures with LED integrated inside them is classifiable under CTH 9405 4090 and taxable @12% GST, Sl. no. 226 of Schedule II of 01/2017-CTR: AAR

- Application disposed of: AAR

2020-TIOL-160-AAR-GST

Global Textile Aliance India Pvt Ltd

GST - Knitted fabrics is classifiable under Chapter 60 and Woven Fabric/Woven fabric backing with non-woven fabric is classifiable under CTH 5407 - further classification is not possible in absence of supply of complete technical details, chargeable @5% GST, Schedule I, Sr. no. 221 and 217 respectively of 1/2017-CTR - Covers for pillows made of knitted or woven fabrics are classifiable under CTH 6304 9239; attracts GST @5%/@12% in terms of Schedule I, Sr. no. 224, Schedule II, Sr. no. 171 of 1/2017-CTR - Foot runners, pillow sheet made of knitted or woven fabrics classifiable under CTH 6302 1090 attracts GST @5%/@12% in terms of Schedule I, Sr. no. 224, Schedule II, Sr. no. 171 of 1/2017-CTR - Chenille yarn made of polyester classifiable under CTH 5606 0020, GST @12%, Sl. no. 138 of Schedule II of 1/2017-CTR - Poly propylene extrusion yarn, polypropylene Texturized yarn, polyester textured yarn are synthetic yarns classifiable under CTH 5402 when not put up for retail sale and under CTH 5406 when put up for retail sale, tax @18%, Sr. no. 159 of Schedule III of 1/2017-CTR up to 12.10.2017 and thereafter @12% GST as per Sl. no. 132B of Schedule II of 1/2017-CTR: AAR

Application disposed of: AAR

2020-TIOL-159-AAR-GST

Heavy Vehicles Factory

GST - Tank is classifiable under CTH 8710 0000 - Retainer steel, valve assembly, casing assembly, hydraulic items, mandrel assembly, nozzle assembly, plate assembly, panel assembly, support assembly and sleeve assembly are classifiable as "Parts" and are also classifiable under CTH 8710 0000 - however, dowel pin, gasket assembly, Stiffner, clip assembly, connector assembly, needle bearing, planet pinion are parts of general use and are not classifiable under CTH 8710 0000 - classification is independent of the buyer or seller and depends only on the goods: AAR

- Application disposed of: AAR

2020-TIOL-158-AAR-GST

AM Abdul Rahman Rowther And Company

GST - Issue raised by the applicant in their application for advance ruling was already pending before the department, therefore, in terms of first proviso to section 98(2) of the CGST Act, 2017, the application is rejected: AAR

- Application rejected: AAR

2020-TIOL-157-AAR-GST

Posco India Steel Distribution Centre Pvt Ltd

GST - Applicant issues consignment note, however, the actual transaction is done through the third-party transporter (who also issues consignment note) - classification of the services supplied by applicant would be under heading 996511 - GST applicable would be as mentioned in Entry 9(iii) of 11/2017-CTR i.e. @5% without ITC - as the third party transporters are not charging any GST on services supplied by them to applicant, there is no question of availment of ITC: AAR

- Application disposed of: AAR

2020-TIOL-156-AAR-GST

Liberty Translines

GST - Applicant issues consignment notes during execution of the service of transportation of goods and has opted for 5% GST payable by the recipient under reverse charge - sometimes, applicant functions as a mere transporter of goods for which consignment note is issued by some other party which acts as GTA for that transaction - there is a company named POSCO which provides GTA service and has opted for GST payable on forward charge basis @12% by claiming ITC - since POSCO does not have enough fleet of its own, it sub-contracts GTA service to applicant who provides the GTA service as a sub-contractor - applicant wants to issue a consignment note to POSCO who is also a GTA and the latter will, in turn, issue a second consignment note to final client for transportation of the goods by road happening in the same vehicle belonging to the applicant where e-way bill is prepared by POSCO only - applicant wishes to know whether he can also act as a GTA in terms of 20/2017-CTR and issue consignment note and charge GST @12% on forward charge basis.

Held: A consignment note is a proof of the custody of goods during the movement and transportation of goods - for a single transaction and the same movement of goods, there cannot be multiple consignment notes, hence there will be only one consignment note for movement of goods to a place, to be issued by POSCO - in view thereof, applicant, in respect of the subject transaction cannot be treated as a GTA and, therefore, cannot charge GST @12% under forward charge mechanism as a GTA - question as to whether POSCO would be eligible to claim credit of the 12% GST charged by applicant in its invoice ought to have been raised by POSCO and not applicant, therefore, Authority refrains from answering this question - the fourth question raised as to whether it is procedurally correct to have two GTA service providers and two consignment notes for the same movement of the goods is not answered as the same is not pertaining to any of the matters mentioned in s.97(2) of the Act: AAR

- Application disposed of: AAR

2020-TIOL-155-AAR-GST

Ashish Arvind Hansoti

GST - Applicant is not entitled to claim ITC of GST paid on inputs and input services used for construction of commercial immovable property, which is subsequently used for renting - since the Orissa High Court decision in Safari Retreats P Ltd. has not attained finality as the department has filed an appeal in the Supreme Court, same cannot be relied upon: AAR

- Application disposed of: AAR

2020-TIOL-154-AAR-GST

A Raymond Fasteners India Pvt Ltd

GST - Threaded metal nuts merit classification under Tariff Item 7318 1600 of the CTA - Applicant should have applied for each product individually since classification is sought for each individual product, hence in respect of only the first product a ruling is given and not in respect of the balance nine products: AAR

- Application disposed of: AAR

2020-TIOL-153-AAR-GST

Hitachi Power Europe Gmbh

GST - Applicant (Project Office) has been awarded contracts for supply of goods and supervisory services by M/s BGR Boilers P Ltd. in relation to projects of M/s NTPC Ltd., M/s Meja Urja Nigam P Ltd. and M/s Damodar Valley Corporation being mega power projects located in Maharashtra, UP and West Bengal respectively - Few employees of the HO of the applicant work in the project office in India for whom all the employer's obligation like Form-16 in accordance with the provisions of s.203 of the Income Tax Act, 1961 are done by the project office (applicant) - since most of these expat employees have their primary bank accounts outside India, salary is paid to these employees from the HO's bank account located abroad, for administrative convenience - applicant, citing the definition of a ‘Project Office' under FEMA, 1999, has submitted that the project office is merely a place of business of a Foreign Company to carry out business in India and does not constitute an establishment; that the head office and project office are not separate establishments under the GST legislation and would accordingly be not subject to levy of GST - ruling is, therefore, sought as to whether GST is applicable on the accounting entry made for the purpose of Indian accounting requirements in the books of accounts of project office for salary cost of Expat employees.

Held: Project Office is an extension of the foreign Head Office - For GST to be applicable on the accounting entry made for the purpose of Indian accounting requirements in the books of accounts of Project Office for salary cost of Expat employees paid by the Head Office, such accounting entry should be seen as a supply of goods, services or both - since the Authority finds that there is a relation of employer and employee between the Project Office and the expat employees, the provisions of Schedule III of the CGST Act comes into play inasmuch as services by an employee to the employer in the course of or in relation to his employment will not be considered as a supply and, therefore, will not attract GST: AAR

- Application disposed of: AAR

2020-TIOL-152-AAR-GST

Rishabh Chopra

GST - Section 95 of the CGST Act allows the Authority to decide the matter in respect of supply of goods or services or both, undertaken or proposed to be undertaken by the applicant on the matters or questions specified in sub-section (2) of s.97 - In the present case, the maintenance charges are collected by the society for having rendered Club or Association services to all the four co-owners including the applicant - Thus, the supply of services, in respect of which the question has been raised is being undertaken by the society and not the applicant - Applicant is a recipient of services in the subject transaction - impugned question raised by applicant is in relation to procedure to be followed by the society in respect of issue of invoices to applicant for the common area maintenance charges and hence the issue is not within the purview of s.97(2) of the Act, hence applicant cannot be admitted - Application rejected: AAR

- Application rejected: AAR

2020-TIOL-151-AAR-GST

Portescap India Pvt Ltd

GST - Section 95 of the CGST Act allows the Authority to decide the matter in respect of supply of goods or services or both, undertaken or proposed to be undertaken by the applicant - Applicant, in the present case, has not undertaken the supply in the subject case - applicant is a recipient of services pertaining to renting of immovable property - the impugned transactions are not in relation to the supply of goods or services or both undertaken or proposed to be undertaken by the applicant and, therefore, the subject application cannot be admitted by the Authority - Application rejected: AAR

- Application rejected: AAR

2020-TIOL-150-AAR-GST

Futuredent

GST - Applicant has not undertaken the supply and is not also proposing to undertake the supply - the applicant is a recipient of services from a person situated abroad - impugned transactions are not in relation to the supply of goods or services or both, undertaken or proposed to be undertaken by the applicant and, therefore, the subject application cannot be admitted as per the provisions of s.95 of the CGST Act, 2017 - Application is rejected: AAR

- Application rejected: AAR

2020-TIOL-149-AAR-GST

Leprosy Mission Trust India

GST - Applicant is a Non-Governmental Organization (NGO), which, among others, administers a Vocational Training Institute at Bankura named Bill Edgar Memorial Vocational Training Centre (BEMVT) primarily for skill development of the underprivileged suffering from leprosy - Applicant's services to the students, faculty and staff with respect to the skill development courses for diesel mechanic, welder and sewing technology are recognized by National Council of Vocational Training - Applicant is, therefore, an ‘educational institution' imparting education as a part of an approved vocational education courses and the same is exempt under Entry 66 (a) of Notification 12/2017-Central Tax (Rate) dated 28/06/2017 as amended - Exemptions under entry 64 or 71 of the above notification are not applicable since applicant is not the Government or local authority and furthermore, the applicant has not provided any evidence that BEMVT is acting as a project implementation agency under the above scheme: AAR

- Application disposed of: AAR

2020-TIOL-148-AAR-GST

Swayam

GST - Applicant is a charitable trust registered u/s 12A of the Income Tax Act, 1961 and extends legal, medical, psychological and financial support to the women and their children surviving violence and abuse - The applicant also facilitates training programmes and workshops for the survivors - It wants to know whether it is liable to pay tax on its activities - applicant submits that it facilitates access of the women survivors to legal aids - For example, it accompanies the survivor to the police and the courts and liaises with the lawyers when required - Depending upon the financial circumstances of the survivor, it often provides support in the form of reimbursement of the court fee, lawyers' fee or medical expenses, including hospitalization or psychiatric counseling - Such financial support is also extended to paying the remuneration of the trainers and charges of the facilitators for trainings and workshops - applicant further submits that it does not charge anything on the survivors for the services it extends. the payments discussed being meted out from donations received and interest on deposits.

Held: The applicant is apparently assisting the women survivors in various ways to get back on their feet - Such survivors of sexual and other violence need services like legal aid, medical assistance, and vocational training - The recipient of such services is, therefore, not the applicant but the survivor woman - The applicant makes payments not to the supplier of the services, but as financial support in the form of reimbursement to the recipient survivor - It is, therefore, not liable to pay GST based on reverse charge mechanism on such payments - Moreover, the applicant does not charge any consideration for facilitating the legal aid and other assistance - Such activities of the applicant, therefore, does not result in 'supply' of service as defined under section 7(1) of the GST Act and hence the applicant is not, therefore, liable to pay tax thereon - To conclude, Applicant's activities do not amount to 'supply' of service, neither is it a recipient of the services for which it often provides financial assistance to the women survivors of sexual and other violence - The applicant is, therefore, not liable to pay GST on the activities described in the application: AAR

- Application disposed of: AAR

2020-TIOL-147-AAR-GST

IZ Kartex Named After P G Korobkov Ltd

GST - Applicant is the local branch of a Russian business entity by the same name ('Foreign Company'), which entered into a Maintenance and Repair Contract ("MARC") with Bharat Coking Coal Ltd ("BCCL") with respect to the machinery and equipment it had supplied - Applicant wants to know whether the Maintenance and Repair Contract makes the supplier liable to pay GST.

Held: MARC holder maintains suitable structures in terms of human and technical resources at the sites of BCCL - It ensures supervision of the equipment, supply of spares and consumable and overheads for 5000 annual working hours for seventeen years, indicating sufficient degree of permanence to the human and technical resources employed at the sites - The MARC Holder, therefore, supplies the service at the sites from fixed establishments as defined under section 2(7) of the IGST Act - The location of the supplier should, therefore, be in India in terms of section 2(15) of the IGST Act - Consequently, supply of the MARC Holder to BCCL is not, therefore import of service within the meaning of section 2(11) of the IGST Act - The MARC Holder should be treated as a supplier located in India triggering clause 9.2.2 of the MARC, and made liable to pay GST, the place of supply being determined in terms of section 12 (2) (a) of the IGST Act - The applicant, being the registered branch of the Foreign Company, should be treated as the domestic MARC Holder in terms of clause 9.2.2 of the MARC and be liable to pay tax accordingly - recipient is not, therefore, liable to pay GST on reverse charge basis in terms of Notification No. 10/2017- Integrated Tax (Rate) dated 28/06/2017: AAR

- Application disposed of: AAR

2020-TIOL-146-AAR-GST

Mansi Oils And Grains Pvt Ltd

GST - Sale of the assets of the applicant by NCLT appointed liquidator is a supply of goods by the liquidator, who is required to take registration u/s 24 of the GST Act - If she [Resolution professional, Smt. Rachna Jhunjhunwala appointed as liquidator by NCLT] is already registered as a distinct person of the corporate debtor in terms of Notification No. 11/2020-Central Tax dated 21/03/2020, she should continue to remain registered till her liability ceases under section 29(1)(c) of the GST Act - goods sold are plant and machineries, office equipment and furniture - They are broad categories classifiable under different HSN and taxable under appropriate Sl Nos of the Schedules under Notification No. 1/2017-CT (Rate) dated 28/06/2017: AAR

- Application disposed of: AAR

AAAR CASES

2020-TIOL-36-AAAR-GST

JVS Foods Pvt Ltd

GST - AAR had held that Fortified rice kernels (FRK) manufactured and supplied by applicant is classifiable under HSN 1904 9000 and attracts GST @18% - while holding so, contention of the applicant that the impugned goods are classifiable under Tariff Item 1006 1090 as Rice-Others and attract GST @ 0%/5% was rejected - appeal filed.

Held: Appellate authority notes that FRK manufactured by the appellant does not have essential character of natural Rice and also does not merit classification under chapter 10 [Rice-Others] in terms of chapter note 1(A) of the said chapter; that FRK is appropriately classifiable under CSH 1904 9000 - there is an admission of fact by the appellant that FRK is a product different from the traditional rice and is to be used for blending in traditional rice - Appeal rejected: AAAR

- Appeal rejected: AAAR

2020-TIOL-35-AAAR-GST

Ordnance Factory Bhandara

GST - AAR had held that - Indian Ordnance Factory is an industrial organization functioning under the Department of Defence Production of Ministry of Defence, GOI - Section 2(53) of the Act defines the word "Government" as the Central/State government - applicant is not created by the Constitution of India as a legislative, executive or judicial authority, hence applicant cannot be treated as "Government" - applicant is not entitled to get exemption under notification 12/2017-CTR in respect of 'liquidated damages' deducted from the payments to be made to suppliers in case of delayed delivery of goods or services; security deposit of suppliers forfeited by applicant due to non-fulfilment of certain contract conditions will also not be exempted as per Sr. no. 62, 12/2017-CTR; unclaimed security deposit cannot be treated as consideration received for supply of goods or services, therefore, applicant not liable to pay tax thereon; nominal charges recovered from employees for availing canteen facility inside factory premises is taxable in terms of 11/2017-CTR under SAC 9963, sr. no.6 of exemption list 12/2017 is not available; renting of Community hall to employees is also liable to GST; since applicant is not an educational institution, school bus facility extended to children of employees is also taxable, not exempted under sr. no. 66(b) of 12/2017-CTR, so also is services of conducting exams taxable; however, renting of residential dwelling is an exempt supply of service - ITC is available only in respect of expenditure related to purchase of LPG cylinders used within industrial canteen - ITC not available in respect of maintenance of garden inside factory premises, parks, playground etc.; also not available in respect of expenditure related to maintenance and upkeep of guest houses, medicines purchased by hospital maintained for treatment of factory employees and dependents - exemption from preparation and generation of E-way bill is available to the applicant being a 'defence formation' - exemption is available from payment of GST on transport of 'military or defence equipment' through GTA - ITCis not required to be reversed on finished goods that are destroyed during testing - Proportionate ITC is required to be reversed in cases where lesser payment is made to supplier due to deduction on account of liquidated damages from supplier's dues - Applicant is also not eligible for exemption in terms of notification 2/2018-CTR in relation to services provided to them by an arbitrator or an Advocate - Renting of immovable property for non-residential purpose is taxable at the hands of the applicant - Applicant is also required to discharge GST on sale of used vehicles, seized and confiscated goods, old and used goods, waste and scrap to a GST registered person - Appeal to AAAR.

Held: Appellant is fulfilling all the conditions stipulated for the Central Government, referred in s.2(53) of the CGST Act and provided under clause (8) of s.3 of the General Clauses Act, 1897 read with Article 53 and 77 of the Constitution of India - Since the appellant is functioning under the Department of Defence Production, Ministry of Defence, GOI and all its activities including administrative, executive, etc. are carried out for and on behalf of the President of India, facts which have been established by the various documents like the Appointment letter of the Group A Gazetted Officer of the Ordnance Factory, OFB Procurement Manual - OFB Procurement Manual clearly shows that all the defence contracts are in the name and on behalf of the President of India only - signatures on the supply order placed with the vendors, the acceptance of tender etc. clearly exhibit that all these executive works are being carried out in the name and on behalf of the President of India and thus it is adequately evident that the Ordnance Factory, Bhandara is nothing but 'the Central Government' in accordance with the provisions of s.2(53) of the CGST Act - appellant is, therefore, not liable to pay GST on the following services supplied by them viz. liquidated damages deducted from payments made to suppliers, amount of security deposit forfeited of suppliers; foods and beverages supplied at industrial canteen inside factory premises; Community hall provided on rental basis to employees of the organisation, school bus facility provided to children of employees and also conducting exams for various vacancies - Appellant is eligible to avail ITC in respect of the Input Services used to maintain gardens inside the factory premises in view of the provisions mandated by the Maharashtra Pollution Control Board - Moreover, since the supply of residential services to their employees is an exempted supply in terms of Sr. no. 12 of 12/2017-CTR, any inputs or input services pertaining to the residential quarters of the employees of the Ordnance Factory, Bhandara which are used inside the residential colony will not be available to the appellant in view of provisions of s.17(2) of the CGST Act, 2017 - Appellants are rightfully entitled to avail ITC in respect of all inputs like medicines, equipment, furniture etc. consumed in the hospitals and input services like maintenance and upkeep of hospitals etc. to provide health services to its employees and their dependents as per the terms of the Ordnance Factory Medical Regulation, in view of the amended section 17(5)(b) of the Act, 2017 effective from 01.02.2019 - No ITC is available against the exempt supply of providing guest house facilities since such supply is exempted in terms of sr. no. 6 of 12/2017-CTR - so also, ITC is not available in respect of the LPG cylinders used in factory canteen as supply of food and beverages at industrial canteen inside the factory premises is exempt in terms of Sr. no. 6 of 12/2017-CTR - Appellant is also not required to reverse ITC on account of deduction of liquidated damages from the payment made to suppliers and this is because deduction of Liquidated damages from the dues of suppliers has no bearing, whatsoever, on the actual taxable amount (GST being paid by suppliers) and GST leviable thereon mentioned in the tax invoices as transaction of Liquidated damages is separate from the transaction of receipt of goods and/or services - as it is held that the appellant is a 'Central Government', the exemption notification 2/2018-CTR in relation to services by an arbitrator or an Advocate is available; insofar as notification 3/2018-CTR in relation to services supplied by way of renting of immovable property to a registered person and notification 36/2017-CTR in relation to payment of tax on reverse charge mechanism on sale of used vehicles, seized and confiscated goods, old and used goods, waste and scrap to a GST registered person, the recipient is required to pay tax on reverse charge mechanism: AAAR

- Appeal disposed of: AAAR

2020-TIOL-34-AAAR-GST

Safset Agencies Pvt Ltd

GST - Applicant is an auctioneer dealing in various goods such as paintings, vintage collectibles, sculptures, classic miniature paintings, fine writing instruments, vintage timepieces, celebrity memorabilia, aristocratic jewellery and vintage cars and seeks an advance ruling as regards the classification and HSN code of goods and GST rates applicable; and whether tax is to be paid on the difference between the selling price and purchase price as stipulated in rule 32(5) of CGST Rules while dealing in second hand goods - AAR held that Liability is required to be discharged on the difference between the selling price and purchase price as stipulated in rule 32(5) of the Rules ONLY in respect of old cars, old jewellery and old watches; HSN Code and rate of tax in respect of Paintings (Heading 9701 @12%); Old Cars (Heading 8703 @18% as per notification 08/2018-CTR); Old Jewellery (Heading 7113); Antique Jewellery of age exceeding hundred years (Heading 9706 @12%); Old Watches (Heading 9101/9102 @18%); Antique Watches of age exceeding hundred years (Heading 9706 @12%); Collectibles (cannot be determined in absence of specifics); Collectibles (Books)(Chapter 49 - no specifics shared, hence tax rate cannot be determined); Antique Books of less than hundred years (Chapter 49 at applicable tax rate) and Antique Books exceeding hundred years of age will be covered under Tariff Item 9706 and liable to tax @12% GST - Insofar as collectibles is concerned, with respect to the example given by applicant with respect to sale, in auction, of a bat signed by Sachin Tendulkar, it is to note that it is not only the bat that is sold; the intrinsic value of a legendary sportsperson like Sachin Tendulkar also comes into play in this case, as for example the specific cricket bat may be costing say, anywhere between Rs.1000/- to Rs.10,000/- but probably will be auctioned off at a price of may be even Rs.One lakh and in such a case the residual entry viz. Serial no. 453 of Schedule III of Notfn. 1/2017-CTR may come into play and tax will be charged accordingly and in these types of cases, it cannot be said that the goods are sold as second-hand or used goods and, therefore, the provisions of rule 32(5) of the CGST Rules will not be applicable - Appeal to AAAR

Held: Appellate authority finds it difficult to agree with the conclusion drawn by the AAR insofar as interpretation of rule 32(5) of the CGST Rules, 2017 is concerned inasmuch as the rule as it stands does not have any qualification to the words "used" or "second hand"' - as the words themselves are not explained in the rule and, therefore, they have to be understood as they are used in common parlance; that the terms "second-hand" and "used" are synonymous words; that goods can be called "second-hand" or "used" when they are not new; it is used by someone else or by the original owner before they are sold - in the instant case, the appellant is an auction dealer whose main business is to sell jewellery, car, watches, antiques etc. - the appellant being an auctioneer dealer sells personal effects or such other goods in an auction which have not come in the market for the first time and, therefore, it is called a secondary market - a primary market refers to any goods when they come to the market for the first time; the website of the appellant - astaguru.com mentions that the appellant sells vintage collectible and rare antiques such as sculptures, paintings, writing instruments, vintage cars etc. and they are players in the secondary market - a reading of rule 32(5) says that the value for tax purpose will be the difference between the selling price and the purchase price - in the instant case, the appellant fulfils all the conditions of the rule viz. the appellant is a seller dealing in buying and selling second-hand goods; the goods sold are second-hand or used goods which have not come for sale for the first time in the market; the appellant has sold the goods as such and has done no processing on them and no ITC is availed by them on the purchase of those goods, therefore, if all the conditions are fulfilled by the appellant, there seems to be no reason in denying them the benefit of the margin scheme as contained in rule 32(5) of the CGST Rules, 2017 - AAR has denied the benefit of the margin scheme to paintings, antique jewellery and antique watches but extended the benefit to old cars, old jewellery and old watches - no reason is advanced in the order for denying the benefit to antique jewellery and antique watches and the reason for denying benefit in respect of paintings is that the "paintings" cannot be treated as used - AAAR is of the opinion that the AAR seems to have been swayed by the fact that antique watches, painting and jewellery are valuable products which cannot be classified in the category of "second-hand" or "used" and that there is a separate tariff heading for "Antiques" in the form of Tariff heading 9706 0000 covering "Antiques exceeding 100 years" - However, it is the view of the AAAR that classification of goods does not have anything to do with the application of Rule 32(5) of the CGST Rules, 2017 - There is nothing in the rule which says that it is not applicable to valuable or precious objects or objects having antique value - it is settled principle of jurisprudence that when the words of a statute are unambiguous and only one reasonable meaning can be given to it, then the Courts are bound to give effect to that meaning - Antique pieces are also second-hand and used by people before they come in the market, so also paintings are bought by appellant from art-collectors and it presupposes that the art collectors have bought it second-hand or used and then sold it to the appellant - it would be an entirely different thing if the appellant had bought the paintings from the artists themselves, however, this is not the fact before the Authority if the submissions of the appellants are considered true - All the categories viz. valuable paintings, antique watches, antique jewellery, though falling under category of valuable goods are at the same time also "second-hand" or "used goods" and, therefore, they cannot be denied the benefit of rule 32(5) of the CGST Rules - the term "antique books" is evocative enough to describe what it contains and the appellant can apply rule 32(5) to it - insofar as collectibles/memorabilia and collectible books are concerned, as no specific details of such goods are given, AAR has not given any ruling and since apart from the description of general nature, no further details are presented by the appellant as to whether they are bought from individual art collectors or not, AAAR agrees with the ruling of AAR to the said extent - Appeal disposed of: AAAR

- Appeal disposed of: AAAR

NAA CASES

2020-TIOL-36-NAA-GST

Director General Of Anti-Profiteering Vs Neeva Foods Pvt Ltd

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Reference received by DGAP from Standing Committee on Anti-Profiteering recommending a detailed investigation in respect of an application, originally examined by the Maharashtra State Screening Committee on Anti-Profiteering alleging profiteering in respect of the restaurant service supplied by respondent (franchisee of M/s Subway India P Ltd.) inasmuch as despite reduction in the rate of GST from 18% to 5% w.e.f 15.11.2017, the respondent had not passed on the commensurate benefit of tax reduction as he had increased the base prices of his products - DGAP has in his reported dated 27.12.2019 computed the profiteered amount as Rs.41,93,431/- and which the Authority agrees with - accordingly respondent is direct to reduce his prices commensurately in terms of rule 133(3)(a) of the Rules - since the recipients are not identifiable, the profiteered amount is required to be deposited in two equal parts in the Central Consumer Welfare Fund and the Maharashtra Consumer Welfare fund along with interest@18% - amount to be deposited within three months failing which it shall be recovered by the Commissioners CGST/SGST concerned - for the contravention of the provisions of s.171 of the Act, the respondent is liable to penal action in terms of s.171(3A) of the Act and in which regard SCN is required to be issued - order passed taking note of notification 55/2020-CT dated 27.06.2020: NAA

- Reference Disposed of: NAA 

2020-TIOL-38-NAA-GST

Director General Of Anti-Profiteering Vs Gaursons Realtech Pvt Ltd

GST - Anti-Prodgft20not017fiteering - s.171 of the CGST Act, 2017 - Respondent has benefited from additional ITC to the extent of 5.77% of the turnover during the period July 2017 to March 2019 and hence the provisions of s.171 have been contravened as he has not passed on the benefit of ITC to his customers - DGAP has determined the profiteered amount as Rs.19,72,09,203/- inclusive of GST @12% (and from applicant an additional amount of Rs.1,41,139/- inclusive of GST @12%) - respondent has already passed on the benefit of Rs.28,22,65,749/- to buyers which includes the applicant - as per Table “G” submitted by the DGAP in its report, the respondent is required to pay the applicant the balance of Rs.53,813/- and to 907 other buyers Rs.1,04,23,791/- along with interest @18% within a period of three months - Authority is also directed to further investigate the amount of benefit which is required to be passed on by the respondent w.e.f 01.04.2019 till 30.06.2020 or till the date of issuance of Completion Certificate, whichever is earlier - for the aforesaid contravention of s.171 of the Act, 2017, penalty is imposable u/s 171(3A), SCN to be issued accordingly - DGAP was further directed to investigate in respect of other projects of the respondent on similar grounds of profiteering - Once the respondent has himself admitted to have executed and passed on the benefit of ITC, no complaint or evidence was required to further investigate whether the benefit of ITC has been correctly computed and passed on to the buyers - Furthermore, once this Authority has ordered the DGAP to cause further investigation under the powers given to it u/s 171(2) of the Act, read with rule 133(4) of the Rules and para 9 of the Methodology and Procedure determined by it under rule 126 of the Rules, the DGAP has no authority to refuse investigation on the ground that there is no complaint in respect of the other projects - Vide report dated 23.10.2018 furnished u/r 129(6) it was submitted by the DGAP that the complaint filed by the applicant no. 1 was not covered under the anti-profiteering measures, however, when the Authority had directed to reinvestigate the case vide its order dated 28.03.2019, the respondent has been found liable for profiteering to the extent of Rs.19,72,09,203/-, therefore, it would be appropriate for the investigation team of the office of the DGAP to be careful in future while carrying out investigation in all such cases - compliance report to be submitted by the Commissioners CGST/SGST within a period of four months: NAA

- Application disposed of: NAA

2020-TIOL-37-NAA-GST

Director-General Of Anti-Profiteering Vs Prasad Media Corporation Pvt Ltd

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Applicant no.1 had alleged that the base price of the ‘2D Movie' tickets was increased by the respondent from Rs.117.18 to Rs.127.12 and that of ‘3D Movie' tickets from Rs.195.32 to Rs.211.86 when the GST rate was reduced from 28% to 18% w.e.f 01.01.2019 - Authority holds that the respondent has resorted to profiteering by way of either increasing the base prices of the service while maintaining the same selling prices or by way of not reducing the selling prices of the service commensurately despite a reduction in GST rate on ‘services by way of admission to exhibition to cinematograph films where price of admission ticket was above one hundred rupees' from 28% to 18% w.e.f 01.01.2019 to 30.06.2019 - respondent has realised an additional amount to the tune of Rs.30,13,058/- from the recipients which included both the profiteered amount and GST on the said profiteered amount - profiteering is determined as Rs.30,13,058/- as per provisions of rule 133(1) of the CGST Rules, 2017 - respondent is directed to reduce the prices of his tickets keeping in view the reduction in the rate of tax so that the benefit is passed on to the recipients - since recipients are not identifiable, respondent is directed to deposit the profiteered amount along with interest @18% in the Central Consumer Welfare Fund and in the Telangana State CWF in the ratio of 50:50 - amount to the deposited within three months - in view of contravention of s.171 of the Act, 2017, penalty is imposable u/s 171(3A) of the Act r/w rule 133(3)(d) of the Rules, 2017 - compliance report to be submitted by Commissioners of CGST/SGST: AAR

- Application disposed of: NAA

INTRIM ORDER

IO No. 20/2020

Bhatia Confectioners

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Applicant alleges that the respondent no. 1 had not passed on the benefit of reduction in the GST rate on ‘Kiwi Shoe Polish' from 28% to 18% w.e.f 15.11.2017 and had instead increased the base price of the impugned product supplied by him so that there was no reduction in the final price of the item despite the reduction in the tax rate - DGAP has reported that respondent no.1 submitted that the supply under invoice dated 13.12.2017 was made by him out of the stock he had purchased from respondent no.2 on which he had borne GST @18% and had later sold the same charging GST @18% and thus the provisions of s.171 of the Act were not attracted - DGAP has further reported that it was evident from the sales data submitted by respondent no. 1 that he had increased the base price of ‘Kiwi Shoe Polish' supplied by him in the post-tax rate reduction period i.e. w.e.f 15.11.2017 from Rs.38.28 to Rs.46.61 - DGAP has also found that the base price was increased by the respondent no.2 immediately after tax rate reduction by such an extent that even with the incidence of lower GST @18%, the cum-tax price of the said goods increased from Rs.47.53 to Rs.53.35 (post 15.11.2017) and thus by increasing the base price of the goods and charging GST at the lower rate of 18% on an increased base price, the respondent no.2 had not passed on the benefit of the tax rate reduction to his recipients; that amount of profiteering by the respondent no.3 in respect of the supply of the impugned product during the period 15.11.2017 to 30.09.2018 worked out to Rs.1,10,41,026/- - Respondent no.3 has in their submissions concluded that the profiteering in respect of Kiwi Paste Shoe Polish black 40 gm worked out to Rs.2,71,064/- and accordingly his computation may be accepted to determine the alleged profiteering - Authority notes that in terms of s.171 of the Act, 2017 profiteering merits to be computed based on comparison of the extant prices of various SKUs/products immediately before and after a tax-rate reduction, hence the submissions of the respondent no.3 and the evidence furnished by them in support of their claim needs to be examined in detail for which DGAP will have to revisit the investigation and recompute the amount of profiteering accordingly if the submission made by the respondent no.3 is found to be factual on verification of the supporting evidence furnished - said reinvestigation will entail not only the examination of the issue of whether the benefit was passed on by respondent no.3 to his recipients by way of reduction in MRP but also whether the benefit was passed on by the other respondents in the supply chain to their respective recipients - Authority under powers conferred on it u/r 133(4) of the Rules read with s.171 of the Act directs the DGAP to reinvestigate the above case in entirety on the lines/points mentioned and submit his report after reinvestigation u/r 129(6) of the Rules: NAA

- Interim order passed

2020-TIOL-35-NAA-GST

Director General Of Anti-Profiteering Vs Pivotal Infrastructure Pvt Ltd

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Applicant alleges profiteering by respondent in respect of purchase of flat in the Deevan project, Gurgaon - inasmuch as it is contended that the respondent had not passed on the benefit of ITC availed by him by way of commensurate reduction in the price of the flat - DGAP in its report has stated that upon comparison of the ITC as a percentage of the total turnover which was available to the respondent during the pre-GST period and that during the post-GST period, it was evident that the respondent had benefits from the additional ITC to the tune of 10.59% of the total turnover and which benefit he was required to pass to the flat buyers in his project; that the amount of benefit of ITC which has not been passed on by the respondent or the profiteered amount comes to Rs.4,83,04,692/- which included GST @12% or GST @8% on the basic profiteered amount; that insofar as applicant no. 1 is concerned, the profiteered amount stands at Rs.57,488/- - respondent has claimed that he has passed on the benefit of Rs.1,85,25,586/- to the flat/shop buyers against the total profiteered amount of Rs.4,83,04,692/- and which fact is ascertained by DGAP after verification of records - Authority agrees with the computation of the profiteered amount made by the DGAP and directs the respondent to return the balance ITC benefit as computed by the DGAP to the applicant and other buyers of flats as well as commercial shops along with interest @18% within three months period - Since the present investigation is only up to 30.06.2019, the DGAP is directed to further investigate on same lines for the period from 01.07.2019 to 30.06.2020 and submit report as per rule 129(6) of the Rules - penalty imposable u/s 171(3A) for the contravention of the provisions of s.171(1) of the Act: NAA

- Application disposed of: NAA

2020-TIOL-34-NAA-GST

Director General Of Anti-Profiteering Vs Vijetha Supermarkets Pvt Ltd

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Supply of Frozen green peas - applicant alleges that the respondent had not reduced the selling price when the GST rate was reduced from 5% to Nil w.e.f 01.01.2019 with denial of ITC vide notification 25/2018-CTR.

Held: Increase in base price exactly equal to the amount of tax reduction is deliberate and has been made with the sole intention of pocketing the benefit of tax reduction - respondent cannot deny the benefit of tax reduction as any increase in the prices made by the suppliers of the respondent on the eve of tax reduction amounts to violation of the provisions of s.171 of the CGST Act by the suppliers also - respondent has accepted the report of the DGAP and furnished the demand drafts to the authority on account of the profiteered amounts as well as 18% interest thereon but the same were returned for depositing the same in the Central and the State Consumer Welfare Funds of Andhra Pradesh and Telangana, however, no confirmation is received in this regard - Profiteering amount is determined as Rs.2,33,515/- and the respondent is directed to deposit the same along with interest @18% in the Consumer Welfare Fund - amount to be deposited within three months and a compliance report is required to be submitted - penalty imposable u/s 171(3A) for the contravention of the provisions of s.171(1) of the Act - notification 35/2020-CT taken into consideration while passing the order: NAA

- Application disposed of: NAA

2020-TIOL-33-NAA-GST

Director General Of Anti-Profiteering Vs Emaar Mgf Land Ltd

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Project Emerald Floors Select-A - Based on the report of the DGAP, it is evident that the Respondent has denied the benefit of ITC to the buyers of the flats being constructed by him in his project in contravention of the provisions of s.171(1) of the Act and has thus resorted to profiteering - Respondent has profiteered by an amount of Rs.19,23,01,682/- inclusive of GST @12% on the base profiteered amount - as the buyers, apart from the applicant, are identifiable as per the documents placed on record, the respondent is directed to pass on the amounts of Rs.19,16,83,441/-, Rs.4,06,859/- and Rs.2,85,572/- to the other flat buyers and the applicants no.1 and 2 respectively along with interest @18% within a period of three months and report compliance - respondent shall reduce the prices to be realised from the buyers of the flats of the above project commensurate with the benefit of ITC received by him - investigation in the present computation is only up to 31.03.2019 and for the further period, applicant or any other buyers is at liberty to approach the Screening Committee to initiate fresh proceedings against the respondent in terms of s.171 of the Act - penalty imposable u/s 171(3A) for the contravention of the provisions of s.171(1) of the Act - similar investigation is required in respect of other projects of the respondent based on their self-admission - DGAP to investigate in respect of the other twenty four projects and submit report in terms of rule 133(5) of the Rules - notification 35/2020-CT taken into consideration while passing the present order: NAA

- Application disposed of: NAA

ROD NOTIFICATION

ROD-01/2020

GST - CBIC notifies one time window for revocation of cancellation of registration

CGST RULES NOTIFICATION

cgst_rule_56

CBIC further extends due date of compliance from June 29 to Aug 30

cgst_rule_55

CBIC further extends due date of compliance from June 29 to Aug 30

cgst_rule_53-CORRIGENDUM

Corrigendum to Notification No. 53/2020-Central Tax , dated the 24th June,2020

cgst_rule_50-CORRIGENDUM

Corrigendum to Notification No. 50/2020-Central Tax , dated the 24th June,2020

CGST AMENDED RULES

CGST Rules, 2017 as amended up to 01.07.2020 Part-A

CGST Rules, 2017 as amended up to 01.07.2020 Part-B

GST MANUAL

A Manual For the GST Help Centres - All about GST Refunds

ARTICLES

Non-compete fee - Competing with the taxman

The position of GST Law on Transition credit

Fulfilling the condition of 80% purchase from registered Persons - Builder dilemma

Is India's GST Law geared to support the Fintech revolution in the post-Covid market? - Part III

Queen's Necklace on a platter

Analyzing tax treatment of buy-back of shares vis-a-vis dividend payout

Works Contract and Medical Prosthetics under Taxation Law

CSR & tax laws - Disposal of certain notions

Is India's GST Law geared to support the Fintech revolution in the post-Covid market? - Part II

Availability of ITC in respect of duty/tax paid after July 2017 for past transactions under CEA, 1944/FA, 1994/CA, 1962

Taxability of Trusts and Institutions

Three years of GST: The Hits and the Misses

Is India's GST Law geared to support the Fintech revolution in the post-Covid market?

GST is here to stay; Let's not butt heads over the Basics

GST - An agenda for reforms - Part - 84 - GST completes three years - Tolerating free samples

On its Third birthday, the return gift

GST - Returns and relaxations - An indepth insight

The Redemption Fine Conundrum

Understanding the Appellate Mechanism under Customs Act,1962

Sale of developed plots - taxed under GST as construction of complex service!

JEST GST by Vijay Kumar

While your hands were being sanitized

No Merger of Boards

Transitional Credit - Determined to Deny

The Cob(Web) by Shailendra Kumar

Post-COVID-19: New Cold War in the making! China to play role of Rogue State Actor!

How to dragoon 'Winged Dragon'? - Not eye-rolling but long-term economic isolationism may!

Post-COVID-19 - New World Order - ' Chini Kum ' if eye is on rule-based stability!