2021-TIOL-256-HC-MP-GST
Pratik Jain Vs State of MP
GST - Petitioner was subjected to SCN u/s 74 of the CGST Act and which culminated into a final order on 30.09.2020 - It is also not disputed that the said order is appealable under section 107 of the Act and merely because the petitioner has to make pre-deposit, instead of filing appeal, the present petition is filed - Bench is not inclined to cause indulgence - Being a legislative command, Bench declines to turn the same into dead letter by entertaining the present writ petition - Consequently, petition fails and is dismissed in limine : High Court [para 3 to 5]
- Petition dismissed: MADHYA PRADESH HIGH COURT
2021-TIOL-255-HC-MP-GST
AY Trading Company Vs DG of GSTI
GST - Petitioners have filed this present petition stating that they have received summons from Directorate General of GST Intelligence under Section 70 for appearance on 23/11/2020; that they are apprehending mischief on the part of the respondent; that they are apprehensive that coercive attempts may be made to extort confession from them; have, therefore, prayed to allow the petitioners, their employees / representatives to have presence of their Advocate at a visible but not audible distance during the course of interrogation and / or recording of their statement. Held: In light of the orders passed by Supreme Court from time to time, Advocate of the petitioners are to be allowed to be present during the interrogation of the petitioners - It is further clarified that he/they should be made to sit at a distance beyond hearing range, but within visible distance and the lawyer must be prepared to be present whenever the petitioners are called upon to attend such interrogation - Writ petition stands partly allowed: High Court [para 7]
- Petition partly allowed: MADHYA PRADESH HIGH COURT
2021-TIOL-251-HC-P&H-GST
Rakesh Arora Vs State of Punjab
GST - Allegation of creation of bogus firms and availment of fake ITC of Rs.21.60 crores and refund claim of Rs.5.02 crores - Petitioner is before the High Court u/s 439 of the CrPC for grant of bail having been arrested u/s 132 of the CGST Act, 2017 .
Held: For deciding the petition for grant of bail, the Court generally desists from considering the merits of the matter in detail - Contention that petitioner is in custody since 5th December 2020 and that no interrogation is done does not enhance the case of the petitioner - The matter is under investigation and there are missing links of the chain which are yet to be joined - Veil created for establishing firms needs to be pierced and the fact that the petitioner remained behind the smoked screen by withholding his identity as well as true identities of partners of the firms cannot be ignored - It emerged from the material collected during investigation that the petitioner is Dharminder Arora @ Raja Bhaiya and to state that such a person if granted bail will not flee or abscond is a risky proposition to be accepted - the Compliance, registration etc. under the Act and most of the evidence is either through electronic medium or online and IDs were created for the said purpose - If the petitioner gets an opportunity, he would be in a position to tamper with the evidence - It cannot be lost sight of that it was petitioner who engaged persons and assigned them respective roles and he would be in a position to influence the witness - Bail cannot be granted solely on the ground that vires of Sections 132 and 69 of the CGST Act are under challenge - There is always presumption of validity of the provision - moreover, operation of the provisions has not been stayed - In the case in hand, bills were being procured from the firms based at Delhi who had no purchases - The tax which was not deposited for these transactions was utilised by the firms for not only availing ITCs but for getting the refunds by showing the sales to export units - In other words, the refund was received for the tax which was actually never received by Revenue - prayer of the petitioner for grant of bail is liable to be rejected - No case is made for grant of bail - Petition is dismissed: High Court [para 19 to 22, 28, 33, 36, 38]
- Petition dismissed: PUNJAB AND HARYANA HIGH COURT
2021-TIOL-63-AAR-GST
Nexustar Lighting Project Pvt Ltd
GST - Applicant is engaged in the business of executing street lighting project - The Government of Odisha, through the Housing and Urban Development Department, the Urban Infrastructure Development Fund and the Directorate of Municipal Administration has decided to develop an energy efficient street lighting system covering new and upcoming road stretches in Greenfield areas across 113 Urban Local Bodies (ULBs), including in the cities of Cuttack, Berhampur, Rourkela, Sambalpur & Bhubaneshwar, on a Public Private Partnership basis - The Applicant has made a successful bid for the said tender and has consequently entered into an agreement on 29.12.2018 for design, supply, installation, operation, maintenance and transfer of the energy efficient Greenfield Public Street Lighting System [GPSLS] and the Centralized Control & Monitoring System with the Government of Odisha represented by the Directorate of Municipal Administration and the ULBs - Under the Agreement, the Applicant undertakes to supply and install equipment such as LED Luminaire, feeder panels, poles, outreach arms, cables/wires with holding arrangement for overhead supply cables, in respect of both, the Greenfield Public Street Lighting System as well as the Centralized Control & Monitoring System - It was submitted that for such installation, the Applicant is entitled to receive a consideration, in the form of Capital Subsidy, being 90% of the total capital expenditure incurred by the Applicant in supplying, installing and commissioning of the equipment - The balance 10% of the total capital expenditure along-with O&M fees is receivable as 'Annuity fees', and is recovered by the Applicant by raising quarterly invoices on the ULBs - After the Greenfield Public Street Lighting System has been commissioned, the Applicant is required to undertake the Operation and Maintenance of the system till the end of the term of the Agreement - applicant has submitted that the entire contract shall he treated as a contract for the composite supply of works contract involving a supply of goods and services; that the activity that will be undertaken by the Applicant will fulfil all the conditions and, therefore, the supply would fall under Entry 3 (vi) of the Notification No. 11/2017-CT(Rate) dated 28 June 2017 - a ruling is requested in this regard. Held: In the agreement submitted by the applicant, the major part of the contract is supply of goods - The price of these goods that are supplied to the client by the applicant constitutes 98.43% of total contract price - Further, the goods that are supplied are used by the applicant to provide services like installation, commissioning and maintenance etc. - Without these goods, the services cannot be supplied by the applicant and, therefore, the goods and services are supplied as a combination and in conjunction and in the course of their business where the principal supply is supply of goods - Therefore, the instant supply squarely falls under the definition of "composite supply" - Thus, there is a composite supply in the subject case since there is no building, construction, fabrication, completion, erection etc. of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of the contract - As per Para 1(c) of Schedule II of the CGST/OGST Act, any transfer of title in goods under an agreement which stipulates that property in goods shall pass at a future date upon payment of full consideration as agreed, is a supply of goods and not a service - Not a Works Contract Service - Provisions of Notification No. 11/2017-CT (Rate) are not applicable to the noticee's case - The principal supply is a 'supply of goods' and, therefore, the GST will have to be paid on the goods at the appropriate rate after classification under the appropriate heading: AAR GST - Applicant further seeks to know as to whether in facts and circumstances of the case, the capital subsidy received/ receivable by the applicant for the subject transaction is liable to be included in the Transaction Value for the purpose of calculation of GST payable in terms of Section 15 of the CGST Act, 2017? - It is the contention of the applicant that the 'Authority' from whom the subsidy is received/receivable is an extension of the State Government and, therefore, the capital subsidy should not be included in the Transaction Value for the purpose of calculation of GST. Held: On perusal of the agreement/contract, it is seen that the capital subsidy received/receivable by the applicant in the instant case is the actual cost incurred by the project SPV (the applicant in the instant case) in the project as approved by the Authority & ULBs - It is not a subsidy which generally means grant/grant-in-aid or a benefit given to an individual, business or institution, usually by the government - It is also not a subsidy which is typically given to remove some type of burden and to promote a social good or an economic policy for overall interest of the public - The so called 'capital subsidy' cannot be a 'subsidy' by any stretch of the imagination, rather the same is a consideration as defined in Section 2(31) of the CGST Act in relation to the supply of goods and, therefore, the said 'capital subsidy' shall certainly be liable to be included in the Transaction Value for the purpose of calculation of GST - Applicant is, therefore, liable to pay GST on 'Capital Subsidy' (90% of the total capital expenditure): AAR
- Application disposed of: AAR
