2019-TIOL-32-AAAR-GST

IMS Proschool Pvt Ltd

GST - The appellant company offers educational training and skilling courses through classroom training and visual coaching - For imparting the training, the appellant developed its own proprietary training formats, material and methodology - The appellant has tie-ups with Govt institutions, including the National Skill Development Corporation - The appellant approached the ARA seeking to know - i) whether educational courses offered by the applicant & which are approved by the NSDC would be construed as in relation to National Skill Development Programme (NSDP) implemented by the NSDC; ii) whether certain educational courses for which qualification standards have not been defined by the NSDC for the time being, would be treated as in relation to NSDP implemented by NSDC; iii) whether modified version of NSDC-approved educational courses, not approved by the NSDC, would be treated as in relation to NSDP implemented by NSDC; iv) if such questions are answered in the affirmative, then whether exemption as per Notfn No 12/2017-CT(R) is available; v) whether exemption under this Notfn would be available if such courses were offered to corporates & business institutions; vi) whether NSDC approved courses imparted by business partners of the applicant as sub-contractors for the applicant, would be considered as offered by the applicant; and vii) whether in such case, exemption under Notfn No 12/2017-CT(R) would be available to the applicant - The ARA noted that the copy of certificate for training partner of NSDC was not produced for the relevant period - The ARA also observed that the NSDP would cover only actual schemes & programmes of skill development undertaken by the Govt & so cannot be contrued to include every possible way in which skills are being enhanced - The AAR answered all questions in the negative - Hence the present appeal.

Held - The NSDC does not implement programmes independently & it is a prime agency for implementing programmes coming through the Ministry of Skill Development & Entrepreneurship - These include PMKVY, Sankalp, Udaan, STAT, Polytechnic Schemes & vocational courses run by various departments & directorates - If the services in relation are provided by training partners approved by NSDC, only then would exemption be available - It is not available on other services provided by the appellant - Moreover, where the training in question, is outside the scope of expressions (i) & (iii) of Entry No 69, then nothing fruitful is to be gained by giving a broad expression to the phrase 'in relation to' as sought for by the appellant - Hence in such circumstances, the findings of the ARA warrant being upheld: AAAR

- Appeal dismissed: AAAR

NAA CASE

2019-TIOL-22-NAA-GST

Kerala State Level Screening Committee On Anti-Profiteeing Vs PEPS Industries Pvt Ltd

GST - Anti Profiteering - Information was received that the Informant company had allegedly profiteered from supply of Peps Spring Koil Bornell Normal Maroon 75x60x6" Mattress (HSN Code 94042910), by not passing on the benefit of GST rate reduction - It was also alleged that the respondent had contravened the provisions of Section 171 of the CGST Act. The Standing Committee examined the matter and referred it to the DGAP - Upon investigation, the DGAP observed that the applicable GST rate of 28% had been reduced to 18% vide Notfn No 41/2017-CT(R) dated 14.11.2017 - Upon scrutiny of invoices, it was observed that the base price of the product, excluding GST, had been reduced after offering a discount - Hence the DGAP concluded that the provisions of Section 171 had not been contravened.

Held - It is clear from a perusal of facts that there was a decrease in the rate of tax of the product in question - But it is also clear that the base price of the product (excluding GST) had been reduced, upon offering a discount - It is also seen that the discount offered exceeds the commensurate rate reduction - In such circumstances, the allegation of profiteering is unsustainable: NAA

- Application disposed of: NAA

AAR CASES

2019-TIOL-97-AAR-GST

Ratan Projects And Engineering Co Pvt Ltd

GST - The applicant is manufacturer of cable tray and angel ladder tray which are mainly used for electrical works - They sends steel structures for galvanising to a job worker along with furnace oil, zinc, nickel that are to be consumed in galvanising process - The applicant seeks a ruling whether dispatch of those consumable materials is to be treated as supply from the principal to the job worker if they are not returned within the time allowed under section 143(1)(a) of GST Act.

Held: Return of galvanised goods to the applicant satisfies the condition of receiving back the inputs in accordance with section 143(1)(a) of GST Act - As the goods like furnace oil and zinc consumed in the process of galvanising are inseparable from the galvanised goods, they should not be treated as supply in terms of section 143(3) of the GST Act, provided they have been entirely used up in the process of galvanising - This Ruling is valid subject to provisions under Section 103 until and unless declared void under Section 104(1) of the GST Act: AAR

- Application disposed of: AAR

2019-TIOL-96-AAR-GST

Bengal Rowing Club

GST - The applicant, a company limited by guarantee and registered with ROC as a nonprofit making company is providing its members privileges and amenities of a club such as swimming facility, gymnasium, indoor games and restaurant service - It seeks an advance ruling on the rate of GST applicable on the services it offers along with the supply of food, services like valet parking, music, decoration and other such services associated with organizing social gatherings - They also wants to know the admissible proportion of input tax credit for services other than the supply of food.

Held: Supply of food, by way of or as part of any service or in any other manner whatsoever, from the applicant's restaurant is classifiable under SAC 9963 and taxable under Sl No. 7(i) or 7(iii) of the Notfn 11/2017-CT (Rate) depending upon the criteria mentioned therein - If food is supplied by way of or as part of services associated with organizing social events at the club premises, together with renting of such premises, it will be classifiable under SAC 9963 and taxable under Sl No. 7(vii) of said notfn - All other services offered by applicant are classifiable under SAC 9995 and taxable under Sl No. 33 of said rate notification - The applicant should apply the provisions under section 17(2) & (6) of GST Act, read with rules 42 and 43 of GST Rules, for reversal of input tax credit, treating supplies, if any, taxable under Sl No. 7(i) of said rate notification, as exempt supplies - Reference to food in this ruling includes the supply of other articles of human consumption and drink - This Ruling is valid subject to the provisions under Section 103 until and unless declared void under Section 104(1) of the GST Act: AAR

- Application disposed of: AAR

SERVICE TAX

CENTRAL EXCISE

2019-TIOL-900-CESTAT-CHD

Hytech Earthmoving Engineers Vs CCE

CX - The appellant company is engaged in trading parts of earthmoving equipment & excavators and receive parts in bulk, which are then sold after consolidation - This is done by putting the products in polythene bags or wooden boxes or gunny bags, without any labelling - The Central Excise officers visited the appellant's premises during the relevant AY - As the earthmoving equipment & excavators fall under Tariff 84264100, 8427, 8429 and 843010 of the First Schedule to the CETA, 1985, the Revenue opined that u/s 2(f)(iii) of the CETA, the activity of re-packing parts amounts to manufacture - It was also observed that the appellants were not registered with the Central Excise Department during the relevant period - Hence SCNs proposing duty demand were issued - On adjudication, duty demand was confirmed along with confiscation of seized goods, although liable to be released upon payment of redemption fine - Penalty was imposed as well - Hence the present appeals.

Held - Considering the provisions of Section 2(f)(iii) of the CETA 1985 which provide the definition and scope of 'manufacture', it is seen that the activity of packing or re-packing goods in unit container, is tantamount to manufacture - The appellant does not put the packed goods in a unit container - It packs the goods in a bigger container for ease of transportation to the buyer's premises - The buyers sell these parts separately without any packing done by the appellant - The parts/components of earth-moving equipments fall under Tariff 84264100, 8427, 8429 and 843010 of the First Schedule to the CETA, 1985, which had been put at Sr No 108 amending the Notfn No 49/2008-CE(NT) dt. 24.12.2008 u/s 4A as notified - These items were not brought under the ambit of Section 2(f)(iii) of the CEA - It was only bought in the Finance Act 2011 with retrospective effect u/s 73 of the Act - The Third Schedule was amended by the Finance Act 2012 and whole period for which demand is raised is prior to such amendment - Hence in the situation prior to 28.05.2012 there was no deeming provision to raise duty demand u/s 2(f))(iii) of the CEA 1944 - the introduction of such amendment which was made effective retrospectively, the extended period of limitation is not invokable to issue SCN - There is no allegation t such as fraud, collusion, willful mis-statement, suppression of facts or intent to evade duty - Hence the demands are unsustainable: CESTAT (Para 2,8,9)

Assessees' appeals allowed

2019-TIOL-896-CESTAT-MUM

Om Shivam Buildcon Pvt Ltd Vs CCE & ST

CX - Appellant is engaged in the manufacture of Ready Mix Concrete and availed CENVAT credit of the CE duty paid on M.S. plates considering the same as capital goods - credit denied along with imposition of interest and penalty - Commissioner(A) upheld the order by holding that M.S. Plates were being used as platforms and hence cannot be treated as capital goods or inputs - appeal to CESTAT.

Held: Rule 2(k) of CCR defining ‘inputs' clarifies that all goods used in the factory by the manufacturer of final product, other than the excluded items listed in clauses (A) to (F) should be considered as ‘input' for the purpose of claim of CENVAT credit - Since plates are used by the mason manufacturing cement bricks and blocks within the factory of the manufacturer of final product, the same should classify as input as per the definition provided in the rules - credit admissible, therefore, impugned order set aside and appeal allowed: CESTAT [para 6, 7]

- Appeal allowed : MUMBAI CESTAT

2019-TIOL-895-CESTAT-MUM

Sindia Steels Ltd Vs Commissioner Of Cgst

CX - Upon being informed that the appellant is not entitled to take credit of CENVAT in respect of Education Cess and Secondary &Higher Secondary Education Cess, they reversed the same promptly by debiting the CENVAT credit account - SCN was issued and equivalent penalty was imposed along with interest and penalty on Director - in appeal, penalty imposed against Director was dropped - assessee in further appeal before CESTAT regarding demand of interest and penalty.

Held: It is very much clear from section 126 and 129 of the Finance Act that Secondary and Higher Secondary Education Cess is not to be levied on the additional duty referred in sub-section (5) of Section 3 of the Customs Tariff Act - Mere taking of credit in the books of account would not entail interest and penalty unless the same is drawn from the account of the government by way of refund or utilisation against duty dues - having regard to the fact that even the intelligence wing officials who conducted investigation are unaware that higher education cess is not to be attached to additional duty referred in sub-section (5) of section 3 of the Customs Tariff Act, the same itself is sufficient indication that even experts in the field of taxation also misinterpreted the provisions due to inadequate understanding - so the case of the appellant can be considered as a bonafide dispute of legal interpretation inasmuch as it has reflected the credit in its account without utilisation that would never justify invocation of extended period - appeal is allowed: CESTAT [para 6, 7]

- Appeal allowed : MUMBAI CESTAT

CUSTOMS

NOTIFICATION/ CIRCULAR

cnt27_2019

Govt notifies tariff rates for import of Crude Palm Oil, Palmolein, Brass scrap, Poppy Seeds, Gold, Silver & Areca Nuts

dgft18pn082

Procedure and ANF for availing Transport and Marketing Assistance (TMA) for Specified Agriculture Products

dgft18cir022

EPCG Scheme - Applicability of amendment to Para 5.10(c) of Hand Book of Procedures 2015-20 (Mid-Term Review)

dgft18not059

Addition of provision related to the Scheme for Rebate of State and Central Taxes and Levies (RoSCTL) notified by the Ministry of Textiles

dgft18not058

Transport and Marketing Assistance (TMA) for Specified Agriculture Products

CASE LAW

Rolex Forge India Vs CC

Cus - 102/2007-Cus - Refund of SAD - application rejected on the ground that the tax invoices did not contain the endorsement to the effect that ‘no credit of additional duty of customs levied u/sub-section 5 of section 3 of the Customs Tariff Act, 1975 shall be admissible' - since such endorsement is a mandatory requirement, in absence of such compliance, rejection of refund cannot be interfered - appeal dismissed: CESTAT [para 2]

- Appeal dismissed : MUMBAI CESTAT