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2022-TIOL-36-AAR-GST
Astaguru Auction House Pvt Ltd
GST - Applicant is entering into a Business Transfer Agreement with M/s Safset Agencies Private Limited (erstwhile business entity), for taking over their division (viz. Astaguru.com) as a going concern - Applicant will carry on the same business of dealing in goods such as paintings, vintage collectibles, sculptures, classic miniature paintings, fine writing instruments, vintage timepieces, celebrity memorabilia, aristocratic jewellery and vintage cars - Entire division i.e. Astaguru.com will be transferred to the applicant on 'as is where is' basis - Applicant will also be procuring the 'goods' on approval basis from unregistered as well as registered persons ('sellers') and will display all such goods on its website and conduct the auction sale in respect of such goods - Goods will be sold to the highest bidder in the auction - Applicant has sought a ruling on the classification and HSN code of various goods along with the GST Rate applicable and also whether the applicant, dealing in second hand goods, is required to pay tax on the difference between the selling price and purchase price as envisaged in rule 32(5) of the CGST Rules, 2017.
Held:
++ (i) Paintings bought from individual art collectors will be classifiable under Heading 9701 and the applicant is liable to pay GST of 12%.
(ii) Old Cars:- Motor Vehicles fall under Heading 8703 of the GST Tariff. All the items under 8703 will attract 28% GST except Tariff item 870310 10; Sub-heading 8703 80 - However old cars will attract a lower rate of tax as per Notification No. 08/2018 CT (Rate) - As per the said Notification, the lesser rate of tax i.e. 18 % is applicable to old cars provided the conditions mentioned therein are fulfilled.
(iii) Old Jewellery:- Articles of jewellery and parts thereof, of precious metal will fall under Heading 7113 of the GST Tariff attracting 3% GST. (iv) Antique jewellery of age exceeding 100 years will fall under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. (v) Old watches:- Wrist watches, pocket-watches and other watches, including stopwatches, with case of precious metal or of metal clad with precious metal will fall under CH 9101 of the GST Tariff and Wrist watches, pocket-watches and other watches, including stop-watches, other than those of Heading 9101 will fall under Heading 9102 of the said Tariff - The rate of GST is 18% and the same will be applicable even to Old Watches.
(vi) Antique watches of age exceeding 100 years will fall under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. (vii) Antique books would fall under HSN 9706 of the GST Tariff and would attract GST @ 12%
++ Applicant dealing in second hand goods is required to pay tax on the difference between selling price and purchase price as stipulated in Rule 32(5) of CGST Rules, 2017: AAR
- Application disposed of: AAR
2022-TIOL-11-AAAR-GST
Abbott Healthcare Pvt Ltd
GST - Applicant has adopted the business model of placing their own medical instruments at the premises of hospitals or laboratories and supplied the pharmaceutical products, reagents, diagnostic kits etc. to be used in such equipment by executing an agreement containing minimum purchase obligation - Applicant seeks a ruling as to whether such placement of medical instruments to unrelated customers like hospitals, labs etc. for their use without any consideration, for a specific period, constitute supply and whether such movement of goods constitutes, otherwise than way of supply, under GST - AAR held that on a plain reading of the preamble of the Agreement itself it is evident that the primary motivation for the applicant to enter into the Agreement to place the instrument at the premises of the customer is the agreement of the customer to purchase Products as defined in the Annexure B of the Agreement in accordance with the terms and conditions specified in the Agreement - According to the clauses 3.1 and 3.2, the customer shall purchase the product exclusively from the applicant at the prices specified in Annexure B for a value not less than that as mentioned in Annexure A; that in case of the monthly purchase falling short of the value agreed, the applicant has the right to raise debit note equal to the deficit amount; that the agreement of the customer to purchase the reagents, calibrators and disposables for use in the instrument exclusively from the applicant for a minimum value every month with obligation to pay the deficit amount in case the purchase in a month falls short of the minimum agreed value constitutes a valid consideration as defined under Section 2(31) of the CGST Act, 2017 ; that the transaction / activity satisfies all the essential ingredients of supply as defined under Section 7 of the CGST Act, 2017; that the applicant owns all rights, title and interest in the instruments and that the customer has no right, title or interest in the instruments other than the right to use the instruments as specified in the agreement, therefore, the placement of the instruments by the applicant at the premises of the customer qualifies to be categorized as supply of services as defined under s.7 of the CGST Act, 2017 - Appeal filed before the AAAR.
Held: The supply such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person involves an element of contractual relationship i.e. Contractual reciprocity wherein the person doing an activity does so at the desire of the person for whom the activity is done in exchange for a consideration - Moreover, it is admitted by the appellant in appeal memorandum too that in a few instances, the appellant had raised suo-moto claim, on the hospital for payment of some amount, where the hospital failed to adhere with the conditions of minimum purchase of reagents etc as per agreement - Further, it is not clear from the records of the case as to whether the appellant were selling the same reagents, etc at the same price to other hospitals/labs where no such instruments were placed for use by them - This information was sought for during the course of hearing but the same was not submitted by the appellant despite granted sufficient time for the same - The chances of charging extra price for the reagents etc. in case of instruments placed for use cannot be ruled out as the appellants are not doing welfare activities to the hospitals otherwise - However, in absence of said information too, it is evident from the clauses of the Agreement that the conditional purchase of reagents etc is clearly linked with the right to use of the instruments by the customers - Hence, the arguments of the appellant that no consideration is involved in the transaction in terms of GST law are not tenable in view of explicit and unambiguous provisions contained in Section 7 read with section 2(31) of CGST Act. 2017 - Term "consideration" has been defined clearly and unambiguously vide sub-section (31) to Section 2 of the CGST Act, 2017 , which encompasses in it the transactions involved in the issue in hand, hence there is no need for recourse to any construction interpretation to understand the meaning of the term - The meaning of the term consideration is clear from the plain language used in the definition - It is settled position of law that where the language of the statute is plain and unambiguous, there does not arise a need for interpretation, hence there is no need for reference to the definition of consideration under Australian Law or the advisories issued thereunder too - Decision taken by authority of advance ruling or appellate authority of advance ruling of other state [Authority for Advance ruling No. KAR ADRG 118/2019 dtd.30-09-2019 - 2019-TIOL-452-AAR-GST in the case of M/s. Randox Laboratories India Pvt. Limited] does not have a precedent value and is not binding on this authority (s.103 refers) - Concluded that the placement of specified medical instruments to unrelated customers like Hospitals, labs etc for their use, by the appellant constitutes supply of services under CGST Act, 2017 - Order by AAR upheld: AAAR
- Appeal dismissed: AAAR
2022-TIOL-422-HC-MP-GST
S R Digital TV And Broadband Pvt Ltd Vs UoI
GST - The only ground on which petitioner has filed petition is that despite repeated demands, the data collected from laptop of Manish Verma were provided to him - However, it is not in dispute that the data and documents relied on in SCN were provided to petitioner - When any of the noticee prays for fair trial then there should be effective participation in entire trial by him also - The petitioner instead of appearing through a legal representative before adjudicating authority was kept on corresponding for supply for entire data collected by respondents during search - No such demand was made by person from whose possession the data was seized - SCN was issued on 12.11.2019 and the final order has been passed on 19.02.2021 - There are as many as 15 noticee along with petitioner and most of them participated in enquiry, at the instance of petitioner alone the entire order cannot be quashed - Even otherwise, appellate authority is competent to examine the effect non-supply of non relied upon documents/ data while deciding the appeal - Even otherwise there are details of data demanded by petitioner only for sake of delaying the proceedings simply letters were sent - The grounds raised in this petition are available before appellate authority to be raised in appeal especially when other noticee might have preferred an appeal against impugned order - Petition is dismissed with liberty to approach appellate authority: HC
- Writ petition dismissed: MADHYA PRADESH HIGH COURT |
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