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2022-TIOL-64-AAR-GST
MH Ecolife E-Mobility Pvt Ltd
GST - AAR had by its order dated 22.12.2021 [ 2021-TIOL-304-AAR-GST ] held that Services provided by the applicant to NMMT under Agreement, by way of supplying, operating and maintaining air-conditioned electrically operated buses are taxable and subject to GST; that the Services are appropriately classifiable under Tariff Heading 9966 [renting of any motor vehicle designed to carry passengers where the cost of fuel is included in the consideration charged from the service recipient] and rate of tax is 12% (with availment of ITC) or 5% (without ITC); that the Applicant is eligible to avail ITC of tax paid on procurement of input supplies used in supplying services to NMMT under the Agreement only when they pay tax @ of 12% on output service - However, after passing of this order, the AAR noticed that a CBIC Circular 164/20/2021-GST, dated 6/10/2021 remained to be considered while passing the said order and the applicant had not pointed out the said circular at the time of final hearing in the case - Inasmuch as in the said Circular it has been clarified against Sr. no. 8/8.4 that â As recommended by the GST Council, it is clarified that the expression "giving on hire" in Sl. No. 22 of the Notification No. 12/2017-CT (Rate) includes renting of vehicles. Accordingly, services where the said vehicles are rented or given on hire to State Transport Undertakings or Local Authorities are eligible for the said exemption irrespective of whether such vehicles are run on routes, timings as decided by the State Transport Undertakings or Local Authorities and under effective control of State Transport Undertakings or Local Authorities which determines the rules of operation or plying of vehicles. â - AAR, therefore, has issued a notice u/s 102 and s.104 of the Act, 2017, seeking to rectify the said order and further that the original ruling is void ab initio since the applicant had suppressed the existence of the said Circular dated 06/10/2021 - Written Submissions were made by the applicant inter alia submitting that there arises no cause for invoking the provisions of s.102/104 but nonetheless, in case the Authority seeks to adopt a view other than that set out in the captioned ruling, the Authority also needs to give heed to the consequential situation which may arise because of such other view and may cast civil liability in the form of interest etc. on the Company, especially given that the such ITC either remains unutilized, or paid on services on which no GST should have been paid (and has not been collected from any other person); that the Authority would also be required to give relief from such civil liability - Revenue in their reply submitted that the decision taken earlier as per order dated 21/12/2021 needs to be changed; that the impugned service is exempt from tax and the applicant is not entitled to ITC - A hearing in the matter was also held on 19.04.2022.
Held:
++ During the course of hearing (on 7/12/2021), the above circular dated 6/10/2021 was not pointed out by the applicant. It is noticed that the decision in the present case is delivered without considering the said circular. It is, therefore, necessary to rectify the decision given in the present case, particularly in the light of the provisions in the said Trade Circular. Non consideration of material provisions is a mistake of law. Not pointing out the relevant circular during the course of hearing or in the written submissions filed earlier is also a suppression of a material event. Hence, there was a necessity of application of Sec 102 and 104 in the present case.
++ There is no denial by the applicant that provisions of said circular are not applicable to the facts of present case. The applicant has nowhere explained that on facts, provisions of said circular are not applicable in present case. On the contrary, this is indirect admission by the applicant that the provisions of the said circular are very much applicable to the facts of the present case. Thus, the decision given earlier cannot be said to be founded on sound legal footing.
++ Authority directs the applicant to follow the provisions of the circular which is of prior date than the date of the decision of this Authority in the earlier ARA order dated 21.12.2021 [ 2021-TIOL-304-AAR-GST ]. The grounds raised during present hearing by the applicant are merely and purely of technical nature and in substance the facts of the present case warrant application of the said circular. The technical objections are also not founded on sound principles of law because, if one reads the texts of above sections, under which present order is being passed, a reasonable mind will come to conclusion that there is no merit in the objections taken by the applicant. Hence, answers to the questions are required to be modified as per the views put forth by the CBIC in the impugned Circular.
Conclusion: Services provided by the applicant to NMMT under the Agreement, by way of supplying, operating and maintaining air-conditioned electrically operated buses are exempt in view of CBIC Circular 164/20/2021-GST, dated 6/10/2021.
- ROM Order passed: AAR
2022-TIOL-24-AAAR-GST
Baroda Medicare Pvt Ltd
GST - AAR has held that supply of medicines, surgical items, implants, consumables and other allied items provided by the hospital through their in-house pharmacy used in the course of providing health care services as well as supply of food and room on rent to in-patients admitted to the hospital for diagnosis, or medical treatment or procedures is a composite supply of In-Patient Healthcare Service; that Supply of in-patient health care services by the applicant hospital as defined in Para 2(zg) of the Notification No. 12/2017-CTR is exempted from CGST as per Sl. No. 74 - AAR also held that the appellant would be liable to pay GST @18% on the payment received directly from the business entity for health services provided to employees of the business entities in relation to 'Occupational Health Check-up' (OHC) or preventive care along with ambulance facility, and allied medical services under "Human health and social care services", in terms of S. No. 31 of the Table of the Notification No. 11/2017-CTR - Aggrieved by this ruling to the extent of holding the appellant liable to tax @18% in respect of OHC, the present appeal is filed.
Held: The GAAR has failed to examine as to whether the description of service provided by the appellant is covered within the description of service given at Sr. No. 74, of the said exemption Notification No. 12/2017-CTR - In view of the definition of Health Care Services, it is clear that there is no disparity when provided by a clinical establishment to a patient inside the clinical establishment or outside the said establishment - on going through explanatory notes of SAC 9993 i.e. Human Health and Social Care Services and headings and sub-heading mentioned under above SAC, Authority finds that other than the Human Health Services (SAC 99931) which is exempted when provided by a clinical establishment an authorized medical practitioner or para-medics, the services by way of Occupation Health Check-ups or preventive care are not covered under the other services referred thereunder viz. Residential care services for the elderly and disabled, Other Social Service with accommodation, Social Services without accommodation for the elderly and disabled & Other Social Service with accommodation - Service to be provided by the appellant viz. Occupation Health Check Ups wherein they will provide round the clock Doctors, Nurses, Medical assistants, Para-medical staff/ personnel for offering treatment, diagnosis, allied healthcare services to the recipient of supply at their site is very well covered under SAC 999312 - Further, in previous Service Tax regime, vide Notification No. 24/2010-ST dated 22.06.2010 and Section 65(105)(zzzzo) of the Finance Act, 1994, Service Tax was made applicable on Occupational Health Check-up Services - However, the Government subsequently exempted the above service vide Notification No. 30/2011-ST dated 25.04.2011 - The definition of Health Care Service is similar in GST regime as compared to Finance Act, 1994 and which the GAAR failed to appreciate - Held that supply of Occupation Health Checkup Service by the hospital i.e. nursing staff, Doctors, Paramedical staff on hospital's payroll working in different corporates for providing health check-up services, ambulance facility and allied medical services to their employees and also the camps conducted for health check-up outside the hospitals to be treated as Health Care Service and exempted under GST in terms of Entry at Sr.No.74 of Notification No.12/2017-Central Tax (Rate) dated 28.06.2017 and Notification No. 12/2017- State Tax (Rate) dated 30.06.2017, as amended: AAAR
- Appeal allowed: AAAR |
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