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2022-TIOL-153-AAR-GST
Preethi Granite Exports
GST - The Applicant stated that they are a Partnership firm engaged in the manufacture and sale of granites, falling under tariff heading 2516 12 00 of the Customs Tariff Act; they have their own quarry and also buy quarry blocks from other suppliers; they export the granite slabs, after cutting & polishing, to various countries; they export 90% of the granite slabs and also sell 10% in domestic market; they are running the business for the past 15-20 years; they have decided to close the business as they could not continue the business due to strict competition in the market - there is no stock of raw material, components, consumables, capital goods & machinery at present in the premises and the said premises has been de-bonded - they have small quantity of finished goods, which will be supplied on payment of tax within a short period of time - they have a balance of Rs.37,22,275/- under CGST, Rs.37,22,275/- under KGST - Rs.9,990/-under Cess, in the Electronic Credit Ledger and Rs.37,955/- under CGST & Rs.37,955/- under KGST in the Electronic Cash Ledger - The Applicant approached the AAR seeking to know if the Applicant continue with the existing GSTIN 29AAEFP0358E1ZC to discharge the GST liability for Rent/Lease received from Lessee and for filing the return relating to Renting / Leasing of the said premises; whether Applicant utilize the balance available in Electronic Credit Ledger (Input Tax Credit) in respect of purchase of Raw material, consumables, capital goods relating to the manufacture of Granite Slabs to discharge GST liability of Rent for the premises given for Rental/Lease basis; and whether Applicant can utilize balance in Cash Ledger to discharge GST liability (Output Tax) of Rent for the premises given for Rental/Lease basis.
Held -
+ The first question is whether the applicant can continue with existing registration for discharge of GST liability and also for filing of returns relating to their new business. In other words, the applicant intends to know whether a separate registration needs to be taken or otherwise for conduct of his new business. It is seen, from the said question, that the applicant does not intend to know whether they are required to be registered or not. The applicant's only concern is whether registration can be continued or a fresh registration needs to be taken for their new business, which is not covered under Section 97(2)(f) i.e. "whether applicant is required to be registered" and hence the said question cannot be answered;
+ The second question is about the utilisation of the ITC available in their Electronic Credit Ledger. The applicant claims that the said question is covered under the issue admissibility of input tax credit of tax paid or deemed to have been paid, in terms of Section 97(2)(d) of the CGST Act 2017. It could be seen from the above that the admissibility or entitlement of credit of tax charged to a registered person, on any supply of goods or services or both, which are used or intended to be used in the course or furtherance of business and the said amount shall be credited to the electronic credit ledger of such registered person, in terms of Section 16 of the CGST Act 2017, subject to the conditions under Section 17(5) of the said Act 8s relevant rules. It is pertinent to mention here that the admissibility of the ITC is concerned till the credit of the said amount into the electronic credit ledger. The applicant in the instant question seeks advance ruling on the issue of utilization of ITC available in the Electronic Credit Ledger and thus the question is not covered under the issues specified in Section 97(2) of the CGST Act 2017;
+ third question is about utilization of amount available in their Electronic Cash Ledger towards discharge of GST liability on rental /lease income, which is not covered under the issues specified in Section 97(2) of the CGST Act 2017. It is observed on examination that the notification 2/2019-Central Tax dated 29.01.2019 was issued to appoint the date i.e. 1.2.2019, from which certain provisions of CGST Act shall come into force. Further Notification No. 16/2019-Central Tax dated 29.03.2019 is issued, in terms of Section 164 of the CGST Act 2017, notifying the amendment to the CGST Rules 2017 and is also applicable to all. Thus the notifications are not relevant to the questions raised and hence the questions are not covered even under "applicability of a notification issued under the provisions of this Act", under Section 97(2)(b) of the CGST Act 2017. In fact the applicant filed the instant application seeking advance ruling in respect of the questions at para 3 supra, claiming that the issues are allegedly covered under Section 97(2)(d) and (e) of the CGST Act 2017.
- Application dismissed: AAR
2022-TIOL-152-AAR-GST
Centre For Symbiosis Of Technology
GST - The applicant stated that they are a premier society registered under Societies Act, providing services of infrastructure, urban development, monitoring and evaluation studies as consultants; they are registered under CGST / KGST Act 2017; they have provided service to Karnataka Urban Infrastructure Development Finance Corporation Ltd., (KUIDFC) - The Applicant also stated that KUIDFC is incorporated under Companies Act, having 75.20% of shareholding by the State Government of Karnataka and 24.80% of shareholding by the Chairman, Bangalore Development Authority, a Government Entity in terms of definition given in Notification No. 32/2017-Central Tax (Rate) dated 13.10.2017; KUIDFC is a State Level Nodal Agency for implementation of Government of India schemes like JNNURM, UIDSSMT etc., which has secured the status of State Level Financial Institution (SLFI) from Government of India - KUIFDC, as a financial intermediary, gets funds from Government of Karnataka, Government of India, World Bank, ADB and other financial markets and provides financial and technical assistance to all Urban Local Bodies (ULBs) in Karnataka including City Corporation, BBMP, BDA, BWSSB and other such agencies in the form of loans and grants for urban infrastructure projects taken up by the ULBs. KUIFDC is under management and control of the State Government of Karnataka by virtue of composition of Board of Directors - The administrative expenses incurred by KUIDFC towards staff and project monitoring etc. is adjusted as management fee and all surplus is transferred back to the State Government - The applicant further stated that they have entered into an agreement dated 26.07.2017, as Supervision and Project Management Consultants with KUIFDC for their programme namely NKUSIP for the divisions i.e. Bellary and Gulbarga and completed the project during 2019. It had been informed by the KUIFDC that the services provided by the applicant fall under article 243W and hence does not attract GST. Thus the applicant has not claimed GST from KUIFDC and filed the GST returns for this project under exempted category - The Applicant approached the AAR to know whether KUIFDC, which is an intermediary agency between ULBs/Town Municipal Councils functioning as Programme Management Unit (PMU) through the divisional offices, implementing agencies of the Local Government Bodies and State Line Departments in the efficient monitoring of sub-programmes, is eligible for claiming exemption from GST under the conditions of exemption as per Notification No. 12/2017 as pure services, for the period of our services provided to them i.e. July 2017 to June 2019.
Held - The GST Flyer also says that the definition of Advance Ruling under the CGST Act 2017 is a broad one, which can be given on a proposed transaction as well as a transaction already being undertaken by the applicant, which is an ongoing transaction - In the instant case the questions, on which the applicant seeks advance ruling, are not in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the said applicant, but in relation to a completed supply, provided by them. Therefore the instant application is beyond the jurisdiction of this authority and hence is liable for rejection - Hence the application is rejected: AAR
- Application dismissed: AAR
2022-TIOL-151-AAR-GST
Capfront Technologies Pvt Ltd
GST - The applicant stated that they are a private limited company, a start-up based in Bengaluru, incorporated on 22-11-2018, with the focus on providing data analytics, digital marketing services & product development; registered under CGST/KGST Act 2017 - The applicant own a mobile application, developed and owned by them, called as "LoanFront", which is a Fintech product and is used as a digital platform to facilitate lending of short term personal loans; they intend to transfer the said mobile application software to their wholly owned subsidiary M/s Vaibhav Vyapaar Private Limited (VVPL) - The Applicant approached the AAR seeking to know whether GST would be applicable on the aforesaid transfer of mobile application software.
Held - The statement of facts conveys that the transfer of business pertains to "LoanFront" app sought to be sold is a fully functional part of the business and the transaction contemplates the transfer of the entire aforesaid business to a new person(WPL), who would not only enjoy a right over the assets but shall also take over the liabilities - It thus postulates that there will be a continuity of business, as the said part of business is said to be functional and is decided to be transferred as a whole to a new owner, and thus amounts to transfer of a going concern, of the said independent part of the business - The transfer of independent part of business pertaining to "LoanFront" app, a mobile software, qualifies to be a transfer of going concern, and the said activity amounts to "Service by way of transfer of going concern as an independent part" and thus is exempted from GST in terms of Sl.no.2 of the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, as amended: AAR
- Application disposed of: AAR |
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