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2023-TIOL-54-AAR-GST AIA Engineering Ltd
GST - First issue to be decided is whether the subsidised deduction made by the applicant from the employees, who are availing food in the factory would be considered as a 'supply' under the provisions of section 7 of the CGST Act, 2017 - The next question is whether the Company is eligible to take the input tax credit for the GST charged by the canteen service provider [CSP] for the canteen services for its employees where the canteen facility is mandatory in terms of section 46 of the Factories Act, 1948.
Held: Applicant is paying GST @ 5% in terms of the invoices raised by the CSP - The applicants primary role is that he provides a demarcated space and that the amount is paid by him to the CSP [a part of which is collected from the employees] on behalf of the employees for administrative convenience - In terms of Circular No. 172/04/2022-GST , it is clarified that perquisites provided by the 'employer' to the 'employee' in terms of contractual agreement entered into between the employer and the employee, will not be subjected to GST - Authority finds that factually there is no dispute as far as [a] the canteen facility is provided by the applicant as mandated in Section 46 of the Factories Act, 1948 read with the Gujarat Factories Rules, 1963 is concerned; and [b] the applicant has provided a sample photocopy of the appointment letter wherein it is stated that the employee would be entitled to other benefits as per the rules of the company - Therefore, Authority holds that the subsidised deduction made by the applicant from the employees who are availing food in the factory would not be considered as a 'supply'; under the provisions of section 7 of the CGST Act, 2017 - Insofar as ITC is concerned, it is restricted to the extent of the cost borne by the applicant for providing canteen services to its direct employees, but disallowing proportionate credit to the extent embedded in the cost of goods recovered from such employees: AAR
- Application disposed of: AAR
2023-TIOL-53-AAR-GST
Kedaram Trade Centre
GST - Applicant wishes to allot developed units to prospective buyers [lessee] on a long term lease basis for a period of 90 years - lessee shall pay a one-time premium of Rs. 13.00 lacs to the applicant [ie confirming party no. 2] as a consideration for allotment of the commercial unit on long term lease period of 90 years - applicant has filed this application seeking advance ruling on the below mentioned questions viz. (i) Whether one time premium received by the applicant on allotment of completed building would be treated as taxable supply or not? & (ii) In case the supply is treated as taxable supply, what will be the applicable rate of tax.
Held: The term 'Lease' is not defined under the GST Act - However, reference could be drawn from the Transfer of Property Act, 1882 [section 105] - Applicant has stated in the submissions that a lease of 90 years is akin to sale but the definition of lease in Transfer of Property Act clearly shows lease could be of perpetuity and, therefore, quantum of time has no relation in determination of lease or sale - In view of the foregoing, Authority is of the view that lease of plot for 90 years by the applicant is not "sale of land" but is a lease and, therefore, does not fall within the ambit of clause 5 of Schedule III of CGST Act, 2017 - Hence, this activity i.e. lease of commercial units on payment of one time lease premium and annual premium is a 'supply' falling within the ambit of section 7(1) of CGST Act, 2017, which defines supply as "all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business" read with clause 2 of Schedule II of CGST Act, 2017, which specifies lease of a land or building as a supply - Held, therefore, that the one time premium received by the applicant on allotment of completed commercial units/building is taxable supply in terms of section 7 of the CGST/GGST Act, 2017; that the supply is classifiable under SAC 9972 [Real Estate Services] and would be leviable to tax at the rate of 18% in terms of notification No. 11/2017-CT(Rate) : AAR
- Application disposed of: AAR
2023-TIOL-52-AAR-GST
Kalpesh Dineshbhai Patel
GST - Applicant has filed an application for advance ruling on behalf of M/s Khanepe Hungermall LLP, who is not registered under GST, seeking application of GST exemption notification 12/2017-CTR and applicability of GST rate - M/s Khanepe inter alia proposes to carry on business of providing hostel facility to students undergoing graduation/post-graduation and master degree courses - Additionally, M/s. Khanepe is also engaged in providing food directly to the students studying in different Universities -
Held: It is observed that the application seeking advance ruling has been filed by Kalpesh Dineshbhai Patel, on behalf of M/s Khanepe Hungermall LLP; that they have only discharged a fee of Rs.5000/- and the questions asked are cryptic and lack in clarity - Authority observes that the applicant is not filed by M/s Khaepe Hungermall LLP but by the Chartered Accountant in his own name - Since the person who has applied is not the person who proposes to undertake the supply, the question of giving advance ruling in the matter simply does not arise - Secondly, the ruling, even if given to the person who has filed the application, will not be binding on M/s Khanepe Hungermall LLP, in terms of s.103 ibid - Thirdly, the application is not accompanied by the requisite fee in terms of s.97(1) r/w rule 104 of the Rules, 2017 - Applicant admits the lapses - The aforementioned application is, therefore, rejected in terms of s.98(2) r/w s.95(a), (c) and 103 of the Act, 2017: AAR
- Application rejected: AAR
2023-TIOL-51-AAR-GST
Gobind Sugar Mills Ltd
GST - Sugarcane juice cannot be considered an agricultural produce as it is produced by way of crushing of sugarcane and hence not produced by farmer; also process changes it's form and constitution - Since sugarcane is not fruit or a vegetable, sugarcane juice shall fall into tariff item 2009 8990 "others" and is taxable at a rate of 6% CGST & 6% SGST or 12 % IGST in terms of Notification no 1/2017 central tax (rate) : AAR
- Application disposed of: AAR
2023-TIOL-10-AAAR-GST
Sankalp Facilities And Management Services Pvt Ltd
GST - Appellant is engaged in the business of providing manpower supply for housekeeping, cleaning, security, data entry operator etc. - They sought an advance ruling on the following question viz. whether they are liable to pay GST on man power services provided to the Central Government, State Government, Local authorities, Governmental authorities and Government entities? - GAAR by its order dated 06.09.2021 extended the benefit of exemption to Government Schools not under Entry Sl No.3 but under Entry Sl. No. 66 to Notification No. 12/2017-CT (Rate) dated 28.06.2017 as amended - They denied the benefit of exemption to Government Colleges under the said Entry Sl. No.66 and denied the benefit of exemption to Government Hospitals under Entry SI. No. 46 and 74 of notification ibid - They further denied the benefit of exemption to Government offices under Entry Sl. No. 3 of Notification No. 12/2017-CT (Rate) - Aggrieved by denial of exemption, the present appeal is filed.
Held: If the intention of the legislature was to exempt all the services provided to Central Government, State Government or Union Territory or Local authority, then there was no need to specify activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution - Even though the appellant is providing services to the Government offices concerned, but they are in no way related to the function entrusted to a Panchayat under article 243G of the Constitution or function entrusted to a Municipality under article 243W of the Constitution, which is carried out by the Government concerned - In view of the foregoing, the manpower supply by the appellant for housekeeping, cleaning, security, data entry etc. to various Government departments, mentioned in their application, is not eligible for exemption against Entry No. 3 to Notification No. 12/2017-Central Tax (Rate) - Appeal is rejected: AAAR
- Appeal rejected: AAAR |
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