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GST – Classification of goods – Gudakhu – it can be classified and rightly so under the residual tariff item 2403 99 90 – other’ of the said Chapter Heading because of its composition, character and use. – TMI Updates – Highlights

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2019 (3) TMI 48 – CESTAT CHENNAI – TMI – CENVAT Credit – input services – House Keeping Services – Held that:- Reliance was placed in the case of WIPRO LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE [2017 (5) TMI 188 – MADRAS HIGH COURT], where it was held that Landscaping of factory or garden certainly would fall within the concept of modernization, renovation, repair, etc. of the office premises. At any rate, the credit rating of an industry is depended upon how the factory is maintained inside and outside the premises – following the said decision, the credit is allowed.
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Refund of unutilized input service credit – date of filing of refund claim – Rule 5 of CCR read with Notification No. 27/2012-CE (NT) dated 18.06.2012 – Held that:- The delay is there only on account of the receipt of appellant’s application for refund and this fact is duly supported by the Legacy Cell letter dated 18.07.2017 in C.No. IV/16/02/2017-Misc.Leg.RF/ RB-II issued by the Office of the Commissioner Go

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e two issues involved viz., i) denial of cenvat credit on House Keeping Services , and ii) refund of unutilized input service credit under Rule 5 of CCR read with Notification No. 27/2012-CE (NT) dated 18.06.2012. He further submitted that the last ST-3 return for the period January, 2017 to March, 2017 was filed by the appellant only on 12.07.2017 since, from July 2017 the GST having been introduced the requirement of filing ST-3 returns was done away with and hence no reversal could be made by the appellant at the time of filing application for refund. He further pointed out that even though Section 140 (1) of CGST Act, 2017 provided an option to carry forward the closing balance as of the last return relating to the period ending with the day preceding the appointed day. He further relied on the decision of the Hon ble Madras High Court in the case of Wipro Ltd. Vs. CCE, Pondicherry – 2018 (10) GSTL 172 (Mad.), Integra software Services Pvt. Ltd. Vs. CCE, Pondicherry – 2017 (48) STR

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reliance on the decision of the Jurisdictional High Court in the case of Wipro Ltd. (supra). Following the judicial precedence therefore, the first issue succeeds. 4.3 The other issue is the date of filing of refund claim. The adjudicating authority has rejected the appellant s claim of it having made the refund claim on 27.06.2017. The first appellate authority has also concluded the date of filing of the refund claim was 12.07.2017 only as against which the appellant contends that there was an attempt to file the refund claim on 27.06.2017 but, the said application was accepted only on 12.07.2017 after being advised by the Assistant Commissioner to wait for some time on account of Revenue Offices being re-located on account of migration to GST. Ld. Consultant thus contends that the delay was not in the date of filing but, rather, is due to the delay in receipt of its application on account of Department s reorganization. 4.4. I find force in the appellant s contention that the delay

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M/s. HEERA CONSTRUCTION CO. PVT. LTD. THE COMMISSIONER CENTRAL GST AND CENTRAL EXCISE, THIRUVANANTHAPURAM, THE ASSISTANT COMMISSIONER CENTRAL TAX AND CENTRAL EXCISE, THIRUVANANTHAPURAM, THE BRANCH MANAGAR STATE BANK OF INDIA, THIRUVANANTHAPURAM AND CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, KERALA – 2019 (3) TMI 249 – KERALA HIGH COURT – TMI – Maintainability of appeal – condonation of delay in filing appeal – requirement with the pre-deposit – Held that:- As far as the delay is concerned, the Tribunal will decide the issue on merits.
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Mandatory pre-deposit – Held that:- Because of the financial hardship the petitioner has pleaded, the petitioner will pay the amount of pre-deposit in five equal monthly instalments. If the pet

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it filed a statutory appeal. 2. For the Tribunal to number the appeal, there are two hurdles: a delay of 385 days and the mandatory requirement of the petitioner's depositing 7.5% of the tax due as a precondition. Citing acute financial constraints, the petitioner in this Interlocutory Application seeks this Court to mitigate the petitioner's hardship of complying with the pre-deposit. In other words, it wants to pay the the pre-deposit of 7.5%, which comes to more than ₹ 2 crore, in instalments. In fact, the petitioner wants ten instalments. 3. The learned Senior Standing Counsel for the respondent nevertheless submits that there had been occasions earlier when this Court extended the time for an appellant to comply with the

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2019 (3) TMI 369 – NATIONAL ANTI-PROFITEERING AUTHORITY – TMI – Profiteering – Auric City Homes – benefit of input tax credit not passed on – net additional benefit of ITC – contravention of Section 171 of the CGST Act, 2017 – whether there has been any benefit of reduction in the rate of tax or ITC that needs to be passed on to the recipients by way of commensurate reduction in prices – Held that:- In the present case, the Respondent has availed benefit of additional ITC of 6.49% (post GST) as compared to 3.65% (pre-GST). Based on the data and the documents filed by the Respondent, this percentage has been rightly arrived at by the DGAP by taking into account the benefit of credit available during pre GST (April 2016 to June 2017) to the taxable turnover received during the said period. Similarly for the post GST period (01 07.2017 to 31.08.2018) the percentage of ITC has been arrived at by taking into account the credit available as against the taxable turnover received during the s

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res. The Respondent has also stated that to 177 home buyers the profiteered amount has been passed on through the credit notes and letters to this effect have been sent to all these home buyers.
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Thus, the Respondent has denied benefit of ITC to the buyers of the flats being constructed by him under the above Policy in contravention of the provisions of Section 171 (1) of the CGST Act, 2017 and has thus realized more price from them than he was entitled to collect and has also compelled them to pay more GST than that they were required to pay by issuing incorrect tax invoices and hence he has committed an offence under section 122 (1) (i) of the CGST Act, 2017 and therefore, he is liable for imposition of penalty – thus, a SCN be issued to him directing him to explain why the penalty prescribed under Section 122 of the above Act read with rule 133 (3) (d) of the CGST Rules, 2017 should not be imposed on him.
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Application disposed off. – Case No. 12/2019 Dated:- 27-2-2019 – S

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way of commensurate reduction in the price after implementation of the GST w.e.f. 01.07.2017 and charged CST on full amount of instalments. This Complaint was further referred to the Standing Committee on Anti-profiteering by the Screening Committee vide minutes of its meeting dated 20.06.2018 under Rule 128 of the above Rules. 2. The above Complaint was examined by the Standing Committee on Anti-profiteering in its meeting held on 07.08.2018 & 08.08.2018 and its minutes were forward to the DGAP for detailed investigation under Rule 129 (1) of the CGST Rules, 2017. 3. The DGAP on receipt of the above minutes had called upon the Respondent to submit reply as to the whether the ITC benefit was passed on by him to his recipients and also asked him to suo-moto determine the quantum of benefit which was not passed on. The Respondent had submitted replies vide letters dated 20.09.2018, 10.10.2018, 16.10.2018, 01.11.2018, 12.11.2018, 13.11.2018, 14.11.2018, 15.11.2018, 19.11.2018, 22.11.2

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ugust, 2017, but he had failed to mention the demand which was raised in the month of March 2018 which included the benefit of ITC which was passed on to the Applicant. He has further submitted that he had given the benefit of ITC to his customers and also assured them that such benefit would be passed on at the time of possession. 4. The DGAP's investigation report has covered the period from 01.07.2017 to 31.08.2018. 5. The Respondent had also submitted the following documents along with their replies: – (a) Copies of GSTR-1 returns for July, 2017 to August, 2018. (b) Copies of GSTR-3B returns for July, 2017 to August, 2018 along with copies of challans for depositing the GST in Cash. (c) Copies of Tran-1 returns for transitional credit availed. (d) Copies of VAT & ST-3 returns for April, 2016 to June, 2017. (e) Copies of all demand letters and sale agreement/contract issued in the name of Shri Ashok Khatri. (f) Tax rates-pre-GST and post-GST. (g) Copy of Balance Sheet for FY

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t and the details of amounts and taxes paid by the Applicant No. 1 to the Respondent were as has been given below in the Table:- Table-'A' (Amount in Rs.) S. No. Payment Stage Due Date Basic % BSP Benefit Passed on Service Tax GST Total 1 Application for allotment (Date of Draw) 27.08.2015 5.00% 1,24,919 4,372 1,29,291 2 On allotment 11.09.2015 20.00% 4,99,674 17,489 5,17,163 3 Date of Draw+6 months 22.03.2016 12.50% 3,12,296 3,12,296 4 Date of Draw+12 months 27.08.2016 12.50% 3,12,296 3,12,296 5 Date of Draw+18 months 27.02.2017 12.50% 3,12,296 3,12,296 6 Date of Draw+24 months 11.09.2017 12.50% 3,12,296 37,476 3,49772 7 Date of Draw+30 months 01.03.2018 12.50% 3,12,296 -12,492 24,984 3,24,788 8 Date of Draw+36 months 27.08.2018 12.50% 3,12,296 24,984 3,37,280 Total 100.00% 24,98,369 -12,492 21,861 87,443 25,95,182 7. The DGAP has also submitted that unlike other cases in which allegation of not passing on the benefit of ITC is generally contested but in the present case the R

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ed that the Respondent was eligible to ITC on VAT paid on inputs but the CENVAT credit of Central Excise Duty paid on inputs was not available and post-GST the Respondent was eligible to avail ITC of GST paid on inputs and input services including the tax paid by his sub-contractors. He has further claimed that from the data submitted by the Respondent duly verified from his returns filed during the pre-GST period (April, 2016 to June, 2017) and the post-GST period (July, 2017 to August, 2018), the details of the ITC availed and the taxable turnover during the above periods were as under:- Table B (Amount in Rs.) S. No. Particulars April, 2016 to March, 2017 April, 2017 to June, 2017 Total (pre-GST) 01.07.2017 to 24.01.2018 25.01.2018 to 31.08.2018 Total (Post-GST) 1 CENVAT of Service Tax Paid on Input Services used for Commercial Shops A 19,06,672 1,49,961 20,56,633 2 Input Tax Credit of VAT Paid on Purchase of Inputs B 1,36,94,480 32,37,996 1,69,32,476 3 Total CENVAT/Input Tax credit

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= (C)*(J)(I) or [(K) = (D)*(J)(I)] 1,59,38,195 3,09,70,006 Ratio of Input Tax Credit Post-GST [(L) = (K)/(I)] 3.65% 6.49% 9. The DGAP has also contented that from the above Table, it was clear that the ITC as a percentage of the total turnover that was available to the Respondent during the pre-GST period from April, 2016 to June, 2017 was 3.65% and during the post-GST period w.e.f. July, 2017 to August, 2018, it was 6.49%. The Report has further claimed that this data duly confirmed that post-GST, the Respondent had benefited from additional ITC to the extent of 2.84% [6.49% (-) 3.65%] of the taxable turnover. The DGAP has also noted that the Central Government, on the recommendation of the GST Council, had levied 18% GST, effective rate of which was 12% in view of 1/3rd abatement on the value of land on construction service vide Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017. He has further noted that the actual GST rate on construction service in respect of affordable

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12.00% 8.00% 3 Ratio of CENVAT/Input Tax Credit to Taxable Turnover asper Table-B above (%) C 3.65% 6.49% 6.49% 6.49% 4 Increase in tax rate post-GST (%) D 6.75% 2.75% 5 Increase in input tax credit availed post-GST(%) E= 6.49% less 3.65% 2.84% 2.84% 2.84% Analysis of Increase in input tax credit: (Amount in Rs.) 6 Base Price collected during July, 2017 to August, 2018 F 20,63,35,174 27,05,32,230 47,68,67,404 7 GST Collected over Basis Price G= F*12% or 8% 2,47,60,221 2,16,42,578 4,64,02,799 8 Total Demand collected H=F+G 23,10,95,395 26,28,49,115 46,33,24,370 9 Recalibrated Basis Price I= F* (1-E) or 97.16% of F 20,04,75,252 26,28,49,115 46,33,24,370 10 GST @12% J=I*12% 240,57,031 210,27,929 450,84,960 11 Commensurate demand price K=I+J 22,45,32,286 28,38,77,044 50,84,09,330 12 Excess Collection of Demand or Profiteering Amount L=H-K 65,63,109 82,97,765 1,48,60,874 10. The DGAP has also intimated that, it was quite clear from the above Table that the additional ITC of 2.84% of the ta

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on the base profiteered amount of ₹ 58,59,919/-. He has further claimed that the amount of benefit of ITC that needed to be passed on by the Respondent to the recipients or in other words, the profiteered amount realised by him during the period between 25.01.2018 to 31.08.2018, come to ₹ 82,97,765/- which included 8% GST on the base profiteered amount of ₹ 78,83,115/- and therefore, the total profiteered amount during the period 01.07.2017 to 31.08.2018 was ₹ 1,48,60,874/- which included GST (@ 12% or 8%) on the base profiteered amount of ₹ 1,35,43,034/-. The home buyer and unit no. wise break-up of this amount was provided in Annex-21 by the DGAP attached with his report, which was inclusive of ₹ 23,772/-(including GST on the base amount of ₹ 21,683/-) which was the profiteered amount in respect of the Applicant No. 1, mentioned at serial No. 65 of Annex-21 of the DGAP's report. 12. The DGAP has also submitted that on the basis of the det

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enefit to be passed on as per Annex-22 3 Other Buyers (Residential) 100 44,966 6,33,27,248 20,00,231 37,76,938 -17,76,707 Excess Benefit passed on. 4 Other Buyers (Residential) 29 13,477 2,72,610 No Consideration Paid Post-GST, However, Respondent passed on benefit. 5 Other Buyers (Residential) 10 4,116 – Cancelled Units 6 Other Buyers (Residential) 26 11,038 – Unsold Units Total Residential (A) 816 3,81,640 46,73,82,690 1,45,59,184 1,11,33,581 34,25,603 7 Commercial Shop Buyers 13 4,438 94,84,715 3,01,690 – 3,01,690 Benefit to be passed on as per Annex-23 8 Commercial Shop Buyers 9 2,901 – No Consideration Paid Post-GST 9 Commercial Shop Buyers 14 7,971 – Unsold Units Total Commercial (B) 36 15,310 94,84,715 3,01,690 – 3,01,690 Grand Total (C)=(A)+ (B) 852 3,96,950 47,68,67,405 1,48,60,874 1,11,33,581 37,27,293 13. The DGAP in his report has noted that as per the table given above the Respondent had passed on lesser benefit than what he should have passed in respect of 651 cases o

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the Respondent during the period w.e.f. 01.07.2017 to 31.08.2018, has not been passed on to the Applicant and other recipients by the Respondent. He has further claimed that on this account, the Respondent had realized an additional amount of ₹ 23,772/- (Sr No. 1 of table- 'D' in para-19) from the above Applicant which included both the profiteered amount @2.84% of the taxable amount (base price) and GST on the said profiteered amount, however, the Respondent had suo-moto passed on ₹ 12,492/- as per the demand letter dated 10.02.2018 issued to the Applicant, and therefore, the Respondent had profiteered by an amount of ₹ 11,280/- (23,772/- (-) 12,492/-). Further, the Report has stated that the Respondent had also realized an additional amount of ₹ 57,65,329/- as mentioned at Sr. No. 2 & 7 of the Table- 'D' above which included both the profiteered amount @2.84% of the taxable amount (base price) and GST on the said profiteered amount from 663

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cant No. 1 did not appear but the DGAP was represented by Shri Manoranjan, Assistant Commissioner while Mr. Ankur Agarwal, Authorised representative and Ms Alka Gupta, CA appeared on behalf of the Respondent. Further hearings were held on 13.02.2019 and 18.02.2019. The Respondent during the hearing submitted that the total turnover of his project was 175 Crores and the project was an affordable housing project. He also submitted that the project had started in August, 2015 and the possession of the flats would be given by July, 2019. The Respondent accepted the Report submitted by the DGAP and said that he was in the process of passing on the ITC benefits as had been mentioned in the DGAP's report to all the recipients/buyers. 16 The Respondent further admitted that the amount of profiteering as calculated by the DGAP would be passed on to all the buyers for both the residential and the commercial units. He also reiterated that the major amount as calculated by the DGAP had already

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een submitted that he had instructed his bank to take necessary action and cheques will be released as and when the bank NOC is issued to the buyers or to the Respondent. 17. On 18.02.2019 the Respondent further submitted that in respect of 188 home buyers of residential units out of the total profiteered amount of ₹ 42,30,691 an amount of ₹ 18,19,582 was passed on and the balance amount of ₹ 24,11,109 along with interest of ₹ 2,03,716 (total ₹ 26,14,825) had been paid through cheques which were filed by him as evidence. He also promised to pay all the 13 buyers of commercial units the entire profiteered amount of ₹ 3,01,690. In respect of 177 home buyers the Respondent stated that since the balance instalments were pending from these buyers the profiteered amount for each one of them will be adjusted against their pending instalments. In this regard he also produced letters to the effect that the amount will be adjusted against the payments due whic

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any supply of goods or services or the benefit of input tax credit has been passed on to the recipient by way of commensurate reduction in prices; (ii) to identify the registered person who has not passed on the benefit of reduction in the rate of tax on supply of goods or services or the benefit of input tax credit to the recipient by way of commensurate reduction in prices; (iii) to order; (a) reduction in prices; (b) return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest at the rate of eighteen percent. from the date of collection of the higher amount till the date of the return of such amount or recovery of the amount not returned, as the case may be, in case the eligible person does not claim return of the amount or is not identifiable, and depositing the same in the Fund referred to in section 57; (c) imposition of penalty as specified in the Act; and (d) cancellation of registration under the Act.

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present case as has been noted by the DGAP the Respondent has availed benefit of additional ITC of 6.49% (post GST) as compared to 3.65% (pre-GST) as can be seen from the table given below. Based on the data and the documents filed by the Respondent, this percentage has been rightly arrived at by the DGAP by taking into account the benefit of credit available during pre GST (April 2016 to June 2017) to the taxable turnover received during the said period. Similarly for the post GST period (01 07.2017 to 31.08.2018) the percentage of ITC has been arrived at by taking into account the credit available as against the taxable turnover received during the same period. Based on the above analysis it is clear that the Respondent had benefit of ITC of ₹ 1,59,38,195 (3.6%) in pre GST when compared to ₹ 3,09,70,006 (6.49%) in the post GST period thus providing him the net benefit of ITC of 2.84%:- 22. It is also evident that the Central Government had levied 18% GST (effective rate w

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iod w.e.f. 01.07.2017 to 24.01.2018 and an amount of ₹ 82,97,765 for the period between 25.01.2018 to 31.08.2018 taking into account the GST effective rate of 8% and net benefit of ITC of 2.84%. Thus the Respondent has profiteered total amount of ₹ 1,48,60,875 for the period from 01.07.2017 to 31.08.2018 in respect of all the 651 residential units and 13 commercial units. The above calculations of the profiteered amount has been duly admitted to be correct by the Respondent and he has willingly accepted to pass on the benefit of additional ITC which had become due to him after coming into force of the ITC. 23. From the documents placed on record and the DGAP's report it is evident that the Respondent has sold 780 units out of 816 residential units, out of which for 29 units there was no consideration paid after introduction of GST, hence the profiteered amount has to be calculated only for 751 units which have been sold and consideration received. Out of these 751 home

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total profiteered amount of ₹ 1,48,60,874 an amount of ₹ 90,84,264 has already been passed on as is evident from Annexure 17 of the DGAP's Report where intimations have been filed by the Respondent stating the details of the payments regarding ITC benefit paid to their buyers. The balance amount of ₹ 57,76,610 is to be passed on to the identified buyers as per the following table:- 24. In view of the above facts this Authority under Rule 133 (3) (a) of the CGST Rules, 2017 orders that the Respondent shall reduce the price to be realized from the buyers of the flats commensurate with the benefit of ITC received by him as has been detailed above. Since the present investigation is only up to 31.08.2018 any benefit of ITC which accrues subsequently shall also be passed on to the buyers by the Respondent as and when the remaining residential/commercial units are sold. The Respondent's Annexures dated 19.02.2019 and 25.02.2019 which comprise of the details of payme

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through Ledger Entries 177 11,60,562/- Total 651 54,74,920/- Commercial Units 13 3,01,690/- Grand Total 57,76,610/- 25. It is evident from the above that the Respondent has denied benefit of ITC to the buyers of the flats being constructed by him under the above Policy in contravention of the provisions of Section 171 (1) of the CGST Act, 2017 and has thus realized more price from them than he was entitled to collect and has also compelled them to pay more GST than that they were required to pay by issuing incorrect tax invoices and hence he has committed an offence under section 122 (1) (i) of the CGST Act, 2017 and therefore, he is liable for imposition of penalty. Accordingly, a Show Cause Notice be issued to him directing him to explain why the penalty prescribed under Section 122 of the above Act read with rule 133 (3) (d) of the CGST Rules, 2017 should not be imposed on him. 26. Further the Authority as per Rule 136 of the COST Rules 2017 directs the Commissioners of CGST/SGST Ha

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2019 (3) TMI 443 – KERALA HIGH COURT – TMI – Recovery of tax – the petitioner, an assessee under the KVAT Act, was found entitled to refund for AY 2007-08; it was also found liable under Section 25(1) of the Act for AY 2016-17. As the amount due from it was more than the amount due to it, the assessing authority adjusted the amount to be refunded and, then, demanded the balance amount – Held that:- Section 89 of the act plainly reveals that if a dealer has paid tax more than what is due from him, he must have that excess amount refunded to him. Once an assessing authority receives an order from any appellate or revisional authority or any officer under subsection (5) of section 47, to refund tax or penalty to a dealer, he must comply with that – But the assessing authority has the power to adjust the amount due to be refunded towards the recovery of any amount due, on the date of adjustment, from the dealer. If the assessing authority delays refund without justification, the dealer ma

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MENT PLEADER DR. THUSHARA JAMES JUDGMENT Facts: The petitioner, a dealer under the Kerala Value Added Tax Act 2003, deals in IT products. It faces assessment proceedings for one year, but claims a refund for another. Thus, this writ petition concerns two assessment years: 2007-08 and 2016-17. 2. In 2012, dissatisfied with the petitioner's self-assessment for the AY 2007-08, the assessing officer re-opened the assessment and passed an order imposing a tax liability. The petitioner then challenged it in a statutory appeal. Finally, through the Ext.P1 order, dated 07.05.2013, the appellate authority remanded the matter for fresh adjudication. After remand, on 02.12.2013 the assessing officer issued a notice to the petitioner and received reply dated 23.12.2013. But later, nothing much happened. So the petitioner claims to have sent the Ext.P2 series of reminders. On 14.06.2018, the assessing officer, in terms of the Ext.P4 hearing notice, heard the petitioner. 3. For the AY 2016-17, t

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petitioner. Yet he adjusts that amount towards the petitioner's alleged liability under the Ext.P10. 6. Thus, the tax consolidation runs as follows: For the AY 2016-17 the tax assessed under Section 25(1) of the Act is ₹ 3,31,21,344/-; and the refund quantified for the AY 2007-08 is ₹ 2,77,34,985/-. Eventually, the assessing officer issued the Ext.P13 demand notice for the balance amount of ₹ 62,48,176/-. Assailing the Exts.P10, P11 and P13 orders, the petitioner has filed this writ petition. Submissions: Petitioner s: 7. Ms. Surya Binoy, the petitioner's counsel, strenuously contends that the whole procedure the assessing officer has adopted is vitiated. According to her, once the revision application was pending, the assessing officer ought not to have pursued the proceedings under Section 25(1) of the Act. This assumes importance, she stresses, in the face of the Ext.P6 judgment, the petitioner invited from this Court for the previous assessment year. 8. Be

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ssing officer adjusted the amount instantaneously, with no notice under Section 31(2), she adds. 10. Ms. Binoy has also contended that had the petitioner gone in appeal, it would have warded off any departmental steps for recovery by paying 20% of the assessed tax. But now the petitioner has been compelled to pay over 80% in the name of adjustment, which is unconscionable. The Respondents : 11. On the other hand, Dr. Thushara James, the Government Pleader, to begin with, has raised a technical issue: the petitioner has an efficacious alternative remedy to assail both the Exts.P10 and P11. 12. Then, dwelling on Section 31(2) of the Act, Dr. James asserts this provision would come into play in the usual course but not with adjustment, which, according to her, is like a set-off. So she contends that any adjustment made departmentally will, of course, be subject to the appellate proceedings the assessee may take. In this particular case, she adds, the petitioner has not at all gone in appe

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hara James, the Government Pleader. Discussion: 17. Simple and straight, the petitioner, an assessee under the KVAT Act, was found entitled to refund for AY 2007-08; it was also found liable under Section 25(1) of the Act for AY 2016-17. As the amount due from it was more than the amount due to it, the assessing authority adjusted the amount to be refunded and, then, demanded the balance amount. Aggrieved, the petitioner has filed this writ petition. 18. As much turns on-the petitioner s counsel asserts so- Sections Section 31(2) and 89 (3) of the Act, we will examine both the provisions. To begin with Section 31 (2), to the extent relevant, reads: 31. Payment and recovery of tax : – (1) Every dealer liable to pay tax under this Act for any return period shall pay tax within such period, as may be prescribed. (2) In the case of a dealer from whom any tax or other amount is demanded shall pay tax in such manner and in such installments, if any, and within such time, as may be specified

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what is due from him, it shall refund the excess to the dealer. (2) When an assessing authority receives an order from any appellate or revisional authority or any officer authorised under sub- section (5) of section 47, to make a refund of tax or penalty or cash security paid by a dealer or any other person, it shall effect the refund to such dealer or such other person, as the case may be. (3) Notwithstanding anything contained in sub-section (1) and (2), the assessing authority shall have power to adjust the amount due to be refunded under sub-section (1) or subsection (2), or under the provisions of the Kerala General Sales Tax Act, 1963 (15 of 1963); towards the recovery of any amount due, on the date of adjustment, from the dealer. (4) In case refund under sub-section (1) or sub-section (2) or adjustment under sub-section (3) is not made within ninety days of the date of completion of assessment or, as the case may be, within ninety days of the date of receipt of the order in app

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adjustment ? 24. The petitioner, indeed, asserts that its liability under Section 39(3) of the Act-that is, its obligation to pay tax- materialises only 15 days after its receiving a notice from the Department. The assessing authority s adjusting the amount, the petitioner further contends, before that eventuality is illegal. 25. Attractive as the petitioner s submission is, I am afraid it fails to pass the judicial muster. Section 31(1) declares that every dealer liable to pay tax for any return period shall pay the tax within such period as may be prescribed. Then, subsection (3) holds that the adjustment must be of any amount due [from the dealer] on the date of adjustment. The amount becoming due, I reckon, differs from the dealer s liability to pay. The amount becomes due the moment it is ascertained by the assessing authority, say, through an order of assessment. But the dealer may have breathing time to pay that amount. So, meritless is the petitioner s contention that the amoun

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KRISHNA PRASAD S Versus STATE TAX OFFICER, THIRUVANANTHAPURAM, THE COMMISSIONER STATE GST DEPARTMENT, THIRUVANANTHAPURAM, STATE OF KERALA REPRESENTED BY SECRETARY (TAXES) , THIRUVANANTHAPURAM AND CENTRAL BOARD OF EXCISE CUSTOMS DEPARTMENT OF REVENUE, NEW DELHI – 2019 (3) TMI 487 – KERALA HIGH COURT – TMI – Constitutionality of section 174 of KGST Act and 101st Constitutional Amendment – Jurisdiction – power to enact section 174 of KGST Act – Held that:- Identical issue decided in the case of M/S. SHEEN GOLDEN JEWELS (INDIA) PVT. LTD. VERSUS THE STATE TAX OFFICER (IB) -1, AND OTHERS [2019 (2) TMI 300 – KERALA HIGH COURT], where it was held that The petitioner's plea is rejected that the State lacks the vires to graft Section 174 into KSGST A

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6 and hence they are ultravires to the Constitution of India. iii. Declare that the powers under the erstwhile Entry 54 do not exist post 15.9.2017 and therefore the provisions of the Kerala Value Added Tax Act, 2003 cannot be enforced after 15.9.2017 since the old entry is not saved. iv. Declare that as Section 19 of the Constitution (One Hundred and first amendment) Act, 2016 is having supremacy over rest of the sections of Constitution (One Hundred and first amendment) Act, 2016, the provision passed under section 174 invoking Article 246A of the Constitution of India (One Hundred and first amendment) Act, 2016 and so any provisions in section 174 which are contradictory to section 19 of the Constitution (One Hundred and first amendment)

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GST – Started By: – anuja bhandari – Dated:- 26-2-2019 – A proprietor firm unregistered in GST has plant machinery in Assets. The proprietor in individual capacity will be introduced as partner in pa

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GST – Started By: – SURYAKANT MITHBAVKAR – Dated:- 26-2-2019 Last Replied Date:- 3-3-2019 – We have done repair work like painting ,Wall repairs, putting tiles, etc. in our factory gala and amount debited to repairs & Maintainnace.Can we avail Input Credit for such transaction. – Reply By Ganeshan Kalyani – The Reply = in my considered view, input tax credit is eligible. – Reply By Alkesh Jani – The Reply = Sir, If the said repairs is with regards to factory (civil structure) it falls within the ambit of Section 17(5)(d) of CGST Act,2017 and explanation given may also be taken into consideration. However, as the factory (civil structure) has been booked as capital goods, the repairs of the same shall be added to it. Therefore, in my vi

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)/(d) of CGST Act,2017. 2. If not capitalised to such immovable property – ITC is eligible. – Reply By Ganeshan Kalyani – The Reply = Sri Alkesh Ji, the repair to the capitalised asset not necessarily capitalised . If the benefit out of the repair is not spread over the year then it is becomes a revenue expenditure. In such cases credit is eligible as specifically provided in section 17 (5) of the CGST Act. Thanks. – Reply By Ganeshan Kalyani – The Reply = As reagard capitalisation of an asset INDAS need to referred. – Reply By KASTURI SETHI – The Reply = How this decision is in favour of the assessee ? That is to be analysed. 2018 (17) G.S.T.L. 690 (A.A.R. – GST) = 2018 (9) TMI 1644 – AUTHORITY FOR ADVANCE RULING, MADHYA PRADESH IN RE : JA

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GST – Started By: – Bharath Kumar – Dated:- 26-2-2019 Last Replied Date:- 27-2-2019 – Goods are damaged/expired while receiving by the recipient dealer. Goods are not returned to the supplier but the supplier issues non inventory credit memo at certain percentage as damage compensation purpose. In this situation what will be the GST impact in all modes ? – Reply By AKReddy andCO – The Reply = Damage or expiry should be treated as sales returns only by the supplier and should issue a credit note. It will be a debit note to the receiver of goods. As he up loads the credit note in the GST portal, you have to reverse the ITC if already availed. The experts may please comment on my opinion. – Reply By KASTURI SETHI – The Reply = Only reversal o

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Customs – Paragraph 4.14 of the Foreign Trade Policy whereby a condition of pre-import has been put for availing the benefit of exemption from levy of integrated tax and GST compensation cess, are ult

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GST – Attachment of bank accounts – input tax credit – considering the amount paid by reversing input tax credit, the interest of the Revenue is sufficiently secured. Therefore, the provisional attach

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Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 26-2-2019 – While number of complaints being filed before National Anti-profiteering Authority (NAA) are on rise, still in the majority of cases, the case for contravention of section 171 of the GST law is not established as profiteering has to be established or substantiated , i.e., not passing of benefit of tax rate reduction and/ or input tax credit. The business entities need not worry about such complaints as the NAA shall adjudicate such cases only on the basis of documentary evidence and facts following principles of natural justice. Few of such complaints recently adjudicated go on to prove that the NAA does not proceed with the pre-determined mindset that each complaint received by it is a fit case of profiteering where section 171 has been contravened. Kerala State Screening Committee on Anti-profiteering & DGAP, New Delhi v. Impact Clothing Co, Bengaluru 2018 (12) TMI 1404 – NATIONAL ANTI-PROFITEERING AUT

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d 02/06/2017 2% 482/- 493 dated 14/08/2017 5% 482/ These shirts were exempted from Central Excise duty, vide Notification No. 30/2004-CE dated 09.07.2004 and attracted only Central Sales Tax (CST) @ 2%. After implementation of the GST w.e.f. 01.07.2017, the tax rate of these products was fixed 5%. The rate of tax on these shirts was actually increased from 2% in the pre-GST era to 5% in the post-GST era. Moreover, the pre-GST and post-GST base prices (excluding tax) had remained the same. Therefore, the provisions of Section 171 of the CGST Act, 2017 have not been contravened and the allegation of profiteering by the supplier was not established. The NAA noted that it is clear from the perusal of the facts of the case that there was no reduction in the rate of tax on the above products w.e.f. 01.07.2017 and hence the anti-profiteering provisions contained in Section 171 (1) of the CGST Act, 2017 are not attracted. Also, there was no increase in the per unit base price (excluding tax) o

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al Price (Rs.) Base price (Rs.) GST (Rs.) Total Price (Rs) 1. Panasonic LED TH43E200DX#45 580 (HSN code 85281211) 27,428/- 7349/- (Rs. 2945/- Central Excise Duty @ 12.5% on 65% of abated MRP of ₹ 36250/as per Annexure-7) + ₹ 4404/- VAT on discounted price ₹ 30,373/-) 34,777/- 27818/- (after discount) 7789/(28% GST) 35,607/- Total Tax Pre-GST in (%) 26.79% Total Tax Post-GST in (%) 28% On scrutiny of invoices, DGAP observed that in the pre-GST era, the subject product attracted VAT @ 14.5% and Central Excise Duty @ 12.5% on 65% of abated MRP of the product, in terms of Notification No. 49/2008 Central Excise (N.T.) dated 24.12.2008. On implementation of the GST w.e.f. 01.07.2017, the GST rate on this product was fixed at 28%. It was reported by DGAP that there was an increase in the rate of tax on the said product from 26.79% in the pre-GST era (VAT and Excise Duty) to 28% in the post-GST era and there was no reduction in the rate of tax. Consequently, as there was no

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n the supply of Peps Spring Koil Bornell Normal Maroon 75x60x6 Mattress by not passing on the benefit of reduction in the rate of tax at the time of implementation of GST w.e.f 01.07.2017. Thus it was alleged that the supplier had indulged in profiteering in contravention of the provisions of Section 171 of CGST Act, 2017. The following invoices for pre-GST and post-GST were considered and relied upon: S.No. Description of the product supplied Pre GST rate Post GST rate Difference (in Rs.) Invoice No.& Date CST Rate Central Excise Duty Rate Price excluding Taxes (in Rs.) Invoice No. & Date GST rate Price excluding GST (in Rs.) 1. Peps Spring Koil Bornell Normal Maroon 75X60X6 Mattress (HSN 94042910) 2901 dated 30.06.2017 2% 12.5% 7,293 C/0014196 dated 09.08.2017 28% 7,986 693 C/002255 dated 15.06.2017 2% 12.5% 7,293 C/003495 dated 21.07.2017 28% 7,643 350 The DGAP observed that in the pre-GST era, the applicable Central Sales Tax (CST) on the product 'Peps Spring Koil Borne

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is a case of reduction in the rate of tax and whether the provision of section 171 of CGST Act, 2017 were attracted. It was held that it is clear from the perusal of the facts of the case that there was no reduction in the rate of tax on the above product w.e.f. 01-07-2017 and that the rate of tax on the said product has increased from 14.5% (2% CST + 12.5% Excise) to 28% and therefore, the allegation of profiteering is not sustainable in terms of Section 171 of the CGST Act, 2017. The complaint was accordingly dismissed. End Note In all the above complaints adjudicated by the NAA, it has been found that there was no prima facie case established and that the complaints should not have reached this stage involving crucial time of DGAP as well as the NAA, besides money spent on such adjudication. It would be desirable for the policy makers to appropriately amend the rules to ensure that: Only complaints with substantial or material evidence leading to anti-profiteering are forwarded to

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2019 (2) TMI 1566 – CESTAT CHENNAI – TMI – Penalty u/s 76 and 78 of FA – the respondent has discharged the entire service tax liability along with interest before issuance of the SCN – Held that:- As per sub-section (3) of Section 73 when the assessee has paid up the service tax along with interest on its own ascertainment or being point out by the officers, no penalties are required to be imposed. In the present case, show cause notice was issued even though the appellant had paid up the entire service tax along with interest immediately on being point out by audit. The adjudicating authority has imposed penalty under section 76.
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The penalties under sections 76 and 78 are mutually exclusive. When the adjudicating authority has considered and imposed penalty under section 76, the same cannot be set aside by the Tribunal in an appeal filed by department requesting to impose penalty under Section 78. There is no ground stated in this appeal contending that penalty imposed under Se

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providing advertising services by displaying the advertisement of their clients on bus back panels, bus shelters etc., after obtaining permission from MTC, TNSTC and Southern Railway. They obtained service tax registration under the category of Advertising Agency Service. During the course of audit of the accounts of the respondents, for the period from October and November 2009, it was noticed that the respondents had short-paid service tax during the period from October 2008 to February 2009 and not paid service tax for the period July 2009 to October 2009. It was also noticed that respondent had declared lesser taxable value for the half-year ending return of 31.3.2009. Show cause notice was issued proposing to demand the short-paid service tax along with interest and for imposing penalties. After due process of law, the adjudicating authority confirmed the demand of ₹ 63,12,484/- raised in the show cause notice and appropriated the said amount already paid by the appellant a

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payment of duty. The adjudicating authority has failed to take note of these facts of suppression and imposed penalty only under section 76 of the Finance Act, 1994. He prayed that the impugned order may be interfered with by imposing penalty under section 78 of the Act ibid. 3. None appeared for the respondent though notices were issued for hearing. 4. The matter is taken up for disposal after hearing the ld. AR and on perusal of records. 5. The grievance of the department is that the adjudicating authority failed to impose penalty under section 78 of the Finance Act. It is seen that the respondent has discharged the entire service tax liability along with interest before issuance of the show cause notice. Part of the amount was paid up by adjusting CENVAT credit. In para 8 of the impugned order the respondent has taken a plea that they defaulted in payment of service tax due to certain legal dispute between their clients. As per sub-section (3) of Section 73 when the assessee has pa

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t requesting to impose penalty under Secction78. There is no ground stated in this appeal contending that penalty imposed under Section 76 is erroneous. The Hon ble High Court of Gujarat in Commissioner of CGST & Central Excise Vs. Sai Consulting Engineering Ltd. – 2018 (15) GSTL 708 (Guj.) has held that simultaneous penalties under Section 76 as well as 78 of the Finance Act cannot be imposed. Similar view is taken in Care and Cure (P) Ltd. Vs. Commissioner of Central Excise, Chandigarh – 2015 (38) STR 225 (P&H). 6. In view of the discussions hereinabove and also applying the ratio of the decisions cited in the present appeal, we hold that simultaneous penalty under section 76 and 78 cannot be imposed under law. given situation, when there is a penalty under section 76, we find that simultaneous penalty under section 78 cannot be imposed under law. In any case, the respondent has paid up the entire demand along with interest before issuance of show cause notice, hence further

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2019 (2) TMI 1568 – CESTAT HYDERABAD – TMI – Commercial training and coaching service – Vocational training institute – animation coaching – Exemption from payment of service tax – N/N. 24/2004-ST dated 10.9.2004 – whether the animation coaching provided by the appellant should be treated as computer training in terms of the aforesaid notification or otherwise? – time limitation – Held that:- The appellant’s coaching is not computer animation and not any computer software or hardware. When a student passes out the course he will not become either a computer hardware or a software professional but he becomes professional in using the computer software to produce animation and animation films. This is similar to CAD software or TALLY software used by professionals in their work. In our view, the test to decide whether or not the training in question is a training related to computer hardware or software is what the trainee does at the end of his training – In this case, the trainee will

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magnetic tape or on any other media or device and includes editing thereof in any manner. The animation film produced by the appellant clearly does not appear to be covered by this definition and therefore, we find appellant is not liable to pay service tax on this service as well.
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Since, we have decided in favour of the appellant on merits, we do not find it necessary to examine the question on limitation – appeal allowed – decided in favor of appellant. – Appeal No.ST/1934/2010 – A/30266/2019 – Dated:- 26-2-2019 – Mr. M.V. Ravindran, Member (Judicial) And Mr. P. Venkata Subba Rao, Member (Technical) Ms Swetha, Advocate for the Appellant. Shri V.R. Pavan Kumar, Superintendent/AR for the Respondent. ORDER Per: P.V. Subba Rao. 1. This appeal is filed against Order-in-Original No. 34/2010-ST dated 07.05.2010. 2. The appellant is engaged in imparting training in various courses in the field of animation like 2D Animation, Extreme 3D, Extreme Compositing (SHAKE), Advance Training (FC

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liable to pay service tax under commercial training and coaching services , even though the courses offered by them were vocational by nature. It was also alleged that they were also providing video tape production service and a demand of ₹ 50,77,447/- under commercial training and coaching service and an amount of ₹ 2,36,484/- under video tape production agency service were issued. After following due process the Commissioner of Customs and Central Excise, vide impugned order, confirmed the demands with interest under Sec.75 of the Finance Act, 1994. He also imposed penalty of ₹ 5,000/- under Sec.77 and penalty equal to the duty demanded under Sec.78 of the Finance Act. Aggrieved by this order, the present appeal has been filed on the following grounds: a. They are providing vocational training or coaching and hence are entitled to the benefit of exemption notification 24/2004-ST. It is evident from the brochures and prospectus the trainees join the institute to get

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be that of accountants and designers. The production of animation movie undertaken by the appellant does not amount to video production agency service. They produced a 22 minute short length animation programme with the name Net ball in 2006-07 and sold it for consideration in terms of agreement dated 1-7-2006 to a company in New Zealand and received consideration in foreign exchange. Therefore, the same should be treated as an export of service. Further, the consideration would be covered by exemption notification which applies to small scale service providers because the rest of their services were not chargeable to service tax. If the small scale exemption is considered only an amount of ₹ 7,385/- is liable to be paid which has also been discharged with interest. In view of the above, they submitted that the production of animation movie undertaken by them is also not liable to service tax as it is an export of service. 3. On limitation, the appellant argued that they had not

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more precisely, interpretation of provisions of Notification No. 24/2004-ST, invoking extended period of limitation is not justified and neither can penalty be imposed. 4. Lastly, he would argue that if the case is held against them, the amounts received by them should be treated as cum-tax values and service tax should be calculated accordingly. 5. Learned departmental representative reiterates the findings of the lower authority. 6. We have considered the arguments on both sides and perused the records. There is no dispute on the facts of the case that appellant is providing training and coaching in computer animation services which according to the appellant is exempted as per notification 24/2004-ST dated 10.09.2004 as amended from time to time. According to the revenue their coaching is provided in computer hardware and software and therefore, they are excluded from the benefit of this exemption notification. A related issue is the taxability of the video film which they produced

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find employment or undertake self employment. This notification was subsequently amended vide notification 19/2005-ST dated 7.6.2005 by inserting a proviso as follows: Provided that nothing contained in this notification shall apply to the taxable services provided in relation to commercial training or coaching by a computer training institute. In explanation to the notification clause (3) has been added as follows: III) Computer training institute means computer training or coaching centre which provides coaching or training relating to computer software or hardware. 8. The point of dispute is whether the animation coaching provided by the appellant should be treated as computer training in terms of the aforesaid notification or otherwise. We find in the particular facts and circumstances of the case that the appellant s coaching is not computer animation and not any computer software or hardware. When a student passes out the course he will not become either a computer hardware or a

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tion 19/2005-ST dated 7.6.2005. Insofar as the video tape production service is concerned, the appellant produced animation movie and sold it for a consideration. Video tape production services as per Sec. 65(119) of the Finance Act, 1994 is any professional videography or a commercial concern engaged in the business of rendering service related to video production. Video tape production means the process of recording any programme, event or function on a magnetic tape or on any other media or device and includes editing thereof in any manner. The animation film produced by the appellant clearly does not appear to be covered by this definition and therefore, we find appellant is not liable to pay service tax on this service as well. Since, we have decided in favour of the appellant on merits, we do not find it necessary to examine the question on limitation. The demand of service tax, interest and penalties are therefore liable to be set aside and we do so. 7. The impugned order is set

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2019 (2) TMI 1604 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – TMI – Input tax Credit – ambulances purchased for the benefit of the employees under legal requirement of the Factories Act, 1948 – Second Proviso to Section 17(5)(b) of the GST Act – Held that:- Input tax credit on inward supply of ambulance, being a motor vehicle, is not admissible under Section 17(5)(a) of the GST Act. The exception carved out under Section 17(5)(b)(iii)(A) of the GST Act for services which are obligatory for an employer to provide to its employees under any law for the time being in force is limited only to rent-a-cab, life insurance and health insurance – Credit not available. – Case No. 02 of 2019 Order No. 43/WBAAR/2018-19 Dated:- 26-2-2019 – SHRI SYDNEY D SILVA, AND SHRI PARTHASARATHI DEY, MEMBER Applicant s representative heard: Shri Nikhil Jha, FCA Preamble A person within the ambit of Section 100 (1) of the Central Goods and Services Act, 2017 or West Bengal Goods and Services Act, 2017 (herei

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the question raised in the Application has neither been decided by nor is pending before any authority under any provision of the GST Act. 1.4 The concerned officer from the revenue has raised no objection to the admission of the application. 1.5 The application is, therefore, admitted. 2. Submissions of the Applicant 2.1 The Application submits that the Applicant has factories in Howrah and Hooghly for manufacturing agricultural machinery and has purchased an ambulance for the benefit of the employees, as required under Section 45(4) of the Factories Act, 1948. The Applicant argues that the input tax paid on inward supply of the ambulance is eligible for credit under the Second Proviso to Section 17(5)(b) of the GST Act, as amended w.e.f. 01/02/2019. 3. Observation & Findings of the Authority 3.1. The Applicant purchased the ambulance on 22/11/2018, as evident from the submitted Invoice No. INV19A001475 dated 22/11/2018 of M/s Supreme & Co Pvt Ltd (GSTIN: 19AACCA7232K1ZK). The

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vehicles or conveyances; or (B) transportation of passengers; or (C) imparting training on driving, flying, navigating such vehicles or conveyances; (ii) for transportation of goods; (b) the following supply of goods or services or both:- (i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery except where an inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply; (ii) membership of a club, health and fitness centre; (iii) rent-a-cab, life insurance and health insurance except where- (A) the Government notifies the services which are obligatory for an employer to provide to its employees under any law for the time being in force; or (B) such inward supply of goods or services or both of a particular category is used by a registered person for making an

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2019 (2) TMI 1605 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – TMI – Classification of supply – Composite supply or mixed supply – service to the students for lodging along with food under MOU with the school / college – exemption under Sl. No. 14 of Notification No. 12/2017–CT (Rate) dated 28/06/2017 – rate of tax – Held that:- The Applicant is offering several individual services in two different combinations to the recipients, depending upon their need for lodging facility. Each of the recipients, however, is charged a consolidated amount for the combination of services he wants to enjoy. The combination of services is, therefore, offered as a mixed supply within the meaning of Section 2(74). In accordance with Section 8(b) of the GST Act it is stated that, “a mixed supply comprising two or more supplies shall be treated as a supply of that particular supply which attracts the highest rate of tax – each of the combinations includes services taxable at 18% rate, which is the highes

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, Advocate Preamble A person within the ambit of Section 100 (1) of the Central Goods and Services Act, 2017 or West Bengal Goods and Services Act, 2017 (hereinafter collectively called the GST Act ), if aggrieved by this Ruling, may appeal against it before the West Bengal Appellate Authority for Advance Ruling, constituted under Section 99 of the West Bengal Goods and Services Act, 2017, within a period of thirty days from the date of communication of this Ruling, or within such further time as mentioned in the proviso to Section 100 (2) of the GST Act. Every such Appeal shall be filed in accordance with Section 100 (3) of the GST Act and the Rules prescribed there under, and the Regulations prescribed by the West Bengal Authority for Advance Ruling Regulations, 2018. 1. Admissibility of the Application 1.1 The Applicant is stated to be the owner of a private boarding house and is providing services of lodging and food exclusively to the students of a secondary school, run by a Chari

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to the Written Submission made at the time of Hearing, has entered into an MOU with St. Michael s School under the management of Sunshine Educational Society, for providing boarding facility exclusively to the students of the said school. The boarding facility shall include lodging, housekeeping, laundry, medical assistance and food. The consideration is a consolidated charge on the individual boarder for the combination of the services. 2.2. The Applicant refers to Circular No. 32/06/2018 dated 12/02/2018 of CBIC. It has clarified that accommodation service to students in a hostel having declared tariff below one thousand rupee per day is exempt under Sl. No. 14 of the Exemption Notification. 2.3. In his Written Submission the Applicant further refers to Sl. No. 66 of the Exemption Notification, and argues that his services to the boarders should also be considered exempt under that entry of the said notification. 3. Submissions of the Revenue 3.1 Revenue states that it appears that

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ion Notification is, therefore, not applicable. 4.2. The Applicant provides services to both day boarders and boarders requiring lodging facilities. In FY 2018-19, the annual consideration for the services without lodging facilities are segregated and charged on the day boarders at ₹ 71,800/- per head, of which ₹ 66,000/- is boarding fees. The boarding fees for those who enjoy lodging facilities is ₹ 1,56,000/- per head. These lodgers have to pay an additional amount of ₹ 13,600/- per head for housekeeping and laundry services, whereas the day boarders pay only ₹ 5,800/- per head for such service. The consideration charged is not, therefore, for lodging and food only. A flat amount is charged for maintenance, electricity and laundry instead of reimbursement of the actual cost. The consideration is, therefore, a consolidated charge for a combination of all these services. 4.3. The Application and the Written Submission do not disclose any separate charge fo

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s, therefore, consists of both taxable and nontaxable supplies. It is also evident that although the services are offered in a bundle, they are not indivisible, and different considerations are paid for different packages of such services offered to the recipients, depending upon their requirement for lodging facility. For example, laundry service is not offered to the day boarders. These are not, therefore, bundles of taxable supplies that are inseparable and supplied only in conjunction with one another in ordinary course of business. The services the Applicant supplies are not, therefore, composite supply, as defined under Section 2(30) of the GST Act. 4.6. It is evident from the above discussion that the Applicant is offering several individual services in two different combinations to the recipients, depending upon their need for lodging facility. Each of the recipients, however, is charged a consolidated amount for the combination of services he wants to enjoy. The combination of

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2019 (2) TMI 1606 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – TMI – Classification of goods – Bags/Sacks (both with & without Handle) made of (i) Laminated P.P. Non-woven Fabric, (ii) B.O.P.P. Pasted P.P. Non-woven Fabric and (iii) Woven Fabric Pasted with Non-woven Fabric – Held that:- HS Code 3923 covers articles of the conveyance or packing of goods, of plastics; etc. Sub-Heading 39232990 is applicable for sacks and bags of plastics which are neither polymers of ethylene nor of poly-vinyl chloride and are subject to 18% GST – Regarding Bags/Sacks made of Woven Fabric Pasted with Non-woven Fabric the Applicant has not stated the constituting materials of the fabric and hence, in the absence of any definite material mentioned for the fabric, the General Rules for the Interpretation of the First Schedule of the Customs Tariff, which has been adopted by GST have to be referred to. – Case Number/ARN 43 of 2018 Order No.41/WBAAR/2018-19 Dated:- 26-2-2019 – SHRI SYDNEY D SILVA, AND SHR

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on-woven Fabric, B.O.P.P. Pasted P.P. Non-woven Fabric, P.P. Woven Fabric Pasted with Non-woven Fabric and Non-woven Bags/Sacks, seeks a Ruling on description & HSN of Bags/Sacks (both with & without Handle) made of (i) Laminated P.P. Non-woven Fabric, (ii) B.O.P.P. Pasted P.P. Non-woven Fabric and (iii) Woven Fabric Pasted with Non-woven Fabric, under the GST Act. 1.1 Advance Ruling is admissible under Section 97(2)(a) of the GST Act. 1.3 The Applicant submits that the question raised in the Application has neither been decided by nor is pending before any authority under any provisions of the GST Act. 1.4 The officer concerned raises no objection to the admission of the Application. 1.5 The Application is, therefore, admitted. 2. Submissions of the Applicant 2.1 The Applicant in Annexure-I of the Application discusses probable classification of different types of fabrics manufactured by them, but remains silent on the description & HSN of Bags/Sacks, on which the Ruling i

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cation No. 01/2017-Central Tax (Rate) dated 28/06/2017. 4. Observation & Finding of the Authority 4.1. Since the Applicant seeks a Ruling on description & HSN i.e. classification of Bags/ Sacks only and not classification of fabrics, manufactured by them, this Authority confines the discussion on Bags/Sacks only. 4.2. In the cited AAR Order No. CT/5492/18-C3 dated 29/05/2018 = 2018 (6) TMI 560 – AUTHORITY FOR ADVANCE RULINGS, KERALA, the Authority for Advance Ruling, Kerala decided classification & rate of tax of carry bags made of P.P. Non-woven fabrics under Chapter 63, taxable @ 5%, as in entry 224 of Schedule 1 of the Notification No. 01/2017- CT (Rate) dated 28/06/2017. Here, the relevant portion of Tariff item 6305 33 00 under the GST Tariff is also mentioned, which covers sacks and bags, of a kind used for packing of goods, made of man-made textile materials which are not flexible intermediate bulk containers but are of polyethylene or polypropylene strip or the like

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2019 (3) TMI 485 – MADHYA PRADESH HIGH COURT – TMI – Grant of regular bail – offence punishable under Section 132 (1) (a), (b) and (c) of Goods & Services Tax Act, 2017 – issuance of fake invoices to get input tax credit – main accused have not been arrested so far – Held that:- U/s. 69 of the GST Act, the Commissioner is having power to arrest if he has reasons to believe that a person has committed an offence specified in Clause (a) or (b) or (c) of sub-section (1) of Section 132 of the GST Act. Section 132(1) (a), (b) and (c) of GST Act define types of offences and according to which, whoever commits offence of supply of any goods or services without issue of any invoice or issues any invoice or bill without supply of goods or services of both or avails input tax credit using such invoice, shall be punished with imprisonment of term which may extend to 5 years and with fine, if the amount involved is more than ₹ 500 Lakhs.
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In view of the statement of the petitioner reco

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GST in the entire country. They apprised that some suppliers are floating fake invoices/good less invoices/taking ITC without receiving the goods. After extensive data mining it revealed that the caucus is operating in different States including Maharashtra, Gujarat, Delhi, West Bengal, etc. The Commissioner, SGST ordered to conduct a joint operation involving officers of CGST and SGST. As per information collected so far, Jagdish Kanani, proprietor of Gurukripa Traders, Thane (Maharashtra) has collected address proof viz-a-viz electricity bill, Adhar Card, etc. of innocent persons for registration of the firm under the GST Act and defrauded the Government Exchequer. The present petitioner came in the contact with Mehul Kheria. Present petitioner along with Mehul Kheria created many bogus and fake firms and issued fake invoices to get the input tax-credit through these invoices and defrauded the Govt. Exchequer and as a result of the investigation till date it is found that in total,

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d for regular bail u/s. 439 of Cr.P.C. Learned Addl. Sessions Judge has found that prima facie the petitioner has said to have committed offence not only u/s. 132(1)(a), (b) & (c) of GST Act but also u/s. 467, 468, 471 and 120-B of IPC and accordingly rejected the application for grant of bail. Hence, the present petition u/s. 439 of Cr.P.C. before this Court. 5. Shri Vivek Dalal, learned counsel for the petitioner, submits that the petitioner has falsely been implicated in the case. He is neither a supplier/purchaser nor a registered dealer under the GST Act. He has not rendered any services nor issued any invoice, therefore, he has wrongly been made accused u/s. 132 of the GST Act. His statement has already been recorded and his custody is not required for further investigation and he will cooperate in further investigation, if any, and is ready to appear before the respondent/prosecution as and when his presence is required. The investigation may take long time to conclude, henc

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2019 (3) TMI 486 – MADHYA PRADESH HIGH COURT – TMI – Grant of regular bail – offence punishable under Section 132 (1) (a), (b) and (c) of Goods & Services Tax Act, 2017 – issuance of fake invoices to get input tax credit – main accused have not been arrested so far – Held that:- U/s. 69 of the GST Act, the Commissioner is having power to arrest if he has reasons to believe that a person has committed an offence specified in Clause (a) or (b) or (c) of sub-section (1) of Section 132 of the GST Act. Section 132(1) (a), (b) and (c) of GST Act define types of offences and according to which, whoever commits offence of supply of any goods or services without issue of any invoice or issues any invoice or bill without supply of goods or services of both or avails input tax credit using such invoice, shall be punished with imprisonment of term which may extend to 5 years and with fine, if the amount involved is more than ₹ 500 Lakhs.
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In view of the statement of the petitioner reco

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ST in the entire country. They apprised that some suppliers are floating fake invoices/good less invoices/taking ITC without receiving the goods. After extensive data mining it revealed that the caucus is operating in different States including Maharashtra, Gujarat, Delhi, West Bengal, etc. The Commissioner, SGST ordered to conduct a joint operation involving officers of CGST and SGST. As per information collected so far, the present petitioner is proprietor of of Meena Traders, Mumbai. He has confessed in his statement that he met Jayesh Bhai in Mumbai who has now shifted to Ahmedabad. The petitioner demanded ₹ 2-3 Lakhs from him and he called him to Mumbai then he explained him about the GST registration and assured that he will earn ₹ 2-3 Lakhs within 2-3 months. Thereafter, he came to Mumbai with ₹ 3,000/- and met Jagdish Kanani, then they collected the papers for GST registration. After obtaining GST Registration number, he send the registration number to Jayesh

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9 and his statements were recorded u/s. 70 of the GST Act. He was confronted with evidence collected during the course of investigation. In his statement, he has disclosed all the information available with him and also admitted that he did not receive any goods physically nor he sold any goods and he did not submit any GST return. He is in contact with present petitioner – Mehul since 1994. 4. The petitioner was formally arrested on 10.1.2019 and produced before the Judicial Magistrate, First Class. Thereafter, he applied for regular bail u/s. 439 of Cr.P.C. Learned Addl. Sessions Judge has found that prima facie the petitioner has said to have committed offence not only u/s. 132(1)(a), (b) & (c) of GST Act but also u/s. 467, 468, 471 and 120-B of IPC and accordingly rejected the application for grant of bail. Hence, the present petition u/s. 439 of Cr.P.C. before this Court. 5. Shri Vivek Dalal, learned counsel for the petitioner, submits that the petitioner has falsely been impl

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12) decided on 8.2.2017. The main accused have not been arrested so far, hence the bail application be rejected. 7. U/s. 69 of the GST Act, the Commissioner is having power to arrest if he has reasons to believe that a person has committed an offence specified in Clause (a) or (b) or (c) of sub-section (1) of Section 132 of the GST Act. Section 132(1) (a), (b) and (c) of GST Act define types of offences and according to which, whoever commits offence of supply of any goods or services without issue of any invoice or issues any invoice or bill without supply of goods or services of both or avails input tax credit using such invoice, shall be punished with imprisonment of term which may extend to 5 years and with fine, if the amount involved is more than ₹ 500 Lakhs. 8. In view of the statement of the petitioner recorded u/s. 70 of the GST Act and the fact that the main accused have not been arrested so far, in the considered opinion of this Court, the petitioner is not entitled fo

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M/s. COCHIN SANITARY STORES Versus ASSISTANT COMMISSIONER, STATE GOODS AND SERVICES TAX, ALUVA, INSPECTING ASSISTANT COMMISSIONERE, STATE GOODS AND SERVICES TAX, MATTANCHERY AND STATE OF KERALA, REPRESENTED BY SECRETARY TO GOVERNMENT, STATE GOODS AND SERVICES TAX DEPARTMENT, THIRUVANANTHAPURAM – 2019 (3) TMI 546 – KERALA HIGH COURT – TMI – Maintainability of petition – statutory remedy of appeal – Classification of goods – water and sanitary equipment – whether classified under entry 3(2) of Schedule III, appended to the KVAT Act, 2003, attracting tax at 4 or 5 per cent or under entry 101 of SRO 82 of 2006, attracting 12.5 per cent? – Held that:- The petitioner may have a good case on merits. That does not mean that we should ignore the sta

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equipment, allegedly made of brass; that is, articles of brass. Claiming so, the petitioner has sought the articles it trades in to be classified under entry 3(2) of Schedule III, appended to the KVAT Act, 2003, attracting tax at 4 or 5 per cent. 2. But the Revenue, on the other hand, wanted it to be treated as articles of brass under entry 101 of SRO 82 of 2006, attracting 12.5 per cent. After providing an opportunity of hearing to the petitioner, the assessing authority has rendered Ext.P8 order of assessment. Assailing that, the petitioner has filed this writ petition. 3. At the outset, the Government Pleader has raised an objection: the petitioner has an efficacious alternative remedy. 4. In response, the learned counsel for the petitio

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arned counsel, under these circumstances, the respondent authorities ought not have restored the department's plea, already rejected as set out in Ext.P4. For that got nullified through the Ext.P5 judgment of this Court. 6. I reckon the petitioner may have a good case on merits. That does not mean that we should ignore the statutory remedies available before its knocking the doors of this Court. Despite my repeated queries, as I have already mentioned, the petitioner's counsel has simply persisted with the merits of the matter and has not supplied any valid reason why I should entertain this writ petition disregarding a statutory remedy. 7. I reckon the writ petition raises issues that can be addressed eminently by the appellate aut

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GST – States – 7/5/2019-LA – Dated:- 26-2-2019 – GOVERNMENT OF GOA Department of Law & Judiciary Legal Affairs Division Notification 7/5/2019-LA The Goa Goods and Services Tax (Amendment) Act, 2019 (Goa Act 4 of 2019), which has been passed by the Legislative Assembly of Goa on 31-1-2019 and assented to by the Governor of Goa on 19-2-2019, is hereby published for the general information of the public. Dnyaneshwar Raut Dessai, Joint Secretary (Law). Porvorim, 26th February, 2019. The Goa Goods and Services Tax (Amendment) Act, 2019 (Goa Act 4 of 2019) [19-2-2019] AN ACT to amend the Goa Goods and Services Tax Act, 2017 (Goa Act 4 of 2017). Be it enacted by the Legislative Assembly of Goa in the Seventieth Year of the Republic of India as follows:- 1. Short title and commencement.- (1) This Act may be called the Goa Goods and Services Tax (Amendment) Act, 2019. (2) Save as otherwise provided in this Act, the provisions of this Act shall come into force on the 1st day of February, 2

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iv) clause (18) shall be omitted; (v) in clause (35), for the expression clause (c) , the expression clause (b) shall be substituted; (vi) in clause (69), in sub-clause (f), after the word and figures article 371 , the expression and article 371J shall be inserted; (vii) in clause (102), the following Explanation shall be inserted, namely:- Explanation.- For the removal of doubts, it is hereby clarified that the expression services includes facilitating or arranging transactions in securities; . 3. Amendment of section 7.- In section 7 of the principal Act, with effect from the 1st day of July, 2017,- (i) in sub-section (1),- (a) in clause (b), after the expression or furtherance of business; , the word and shall be inserted and shall always be deemed to have been inserted; (b) in clause (c), the word and shall be omitted and shall always be deemed to have been omitted; (c) clause (d) shall be omitted and shall always be deemed to have been omitted; (ii) after sub-section (1), the foll

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ient as if he is the person liable for paying the tax in relation to such supply of goods or services or both. . 5. Amendment of section 10.- In section 10 of the principal Act,- (i) in sub-section (1),- (a) for the expression in lieu of the tax payable by him, an amount calculated at such rate , expression in lieu of the tax payable by him under sub-section (1) of section 9, an amount of tax calculated at such rate shall be substituted; (b) in the proviso, for the expression one crore rupees, as may be recommended by the Council. , the expression one crore and fifty lakh rupees as may be recommended by the Council: shall be substituted; (c) after the proviso, the following proviso shall be inserted, namely:- Provided further that a person who opts to pay tax under clause (a) or clause (b) or clause (c) may supply services (other than those referred to in clause (b) of paragraph 6 of Schedule II), of value not exceeding ten percent of turnover in the State in the preceding financial ye

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whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise; (ii) where the services are provided by the supplier to any person on the direction of and on account of such registered person; ; (ii) in clause (c), for the word and figures section 41 , the words, figures and letter section 41 or section 43A shall be substituted. 9. Amendment of section 17.- In section 17 of the principal Act,- (i) in sub-section (3), the following Explanation shall be inserted, namely:- Explanation.- For the purposes of this sub-section, the expression value of exempt supply shall not include the value of activities or transactions specified in Schedule III, except those specified in paragraph 5 of the said Schedule. ; (ii) in sub-section (5), for clauses (a) and (b), the following clauses shall be substituted, namely:- (a) motor vehicles for transportation of persons having approved seating capacity of not more than t

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received by a taxable person engaged,- (I) in the manufacture of such motor vehicles, vessels or aircrafts; or (II) in the supply of general insurance services in respect of such motor vehicles, vessels or aircrafts insured by him; (b) the following supply of goods or services or both,- (i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, leasing, renting or hiring of motor vehicles, vessels or aircrafts referred to in clause (a) or clause (aa) except when used for the purposes specified therein, life insurance and health insurance: Provided that the input tax credit in respect of such goods or services or both shall be available where an inward supply of such goods or services or both is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply; (ii) membership of a club, health and fitness centre; and (iii) travel benef

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amount equivalent to such enhanced turnover. ; (ii) in the Explanation, in clause (iii), after the word Constitution , the expression except the State of Jammu and Kashmir and States of Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand shall be inserted. . 12. Amendment of section 24.- In section 24 of the principal Act, in clause (x), after the words commerce operator , the words and figures who is required to collect tax at source under section 52 shall be inserted. 13. Amendment of section 25.- In section 25 of the principal Act,- (i) in sub-section (1), after the proviso and before the Explanation, the following proviso shall be inserted, namely:- Provided further that a person having a unit, as defined in the Special Economic Zones Act, 2005 (Central Act 28 of 2005), in a Special Economic Zone or being a Special Economic Zone developer shall have to apply for a separate registration, as distinct from his place of business located outside the Special Ec

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y suspend the registration for such period and in such manner as may be prescribed. . 15. Amendment of section 34.- In section 34 of the principal Act,- (i) in sub-section (1),- (a) for the words Where a tax invoice has , the words Where one or more tax invoices have shall be substituted; (b) for the words a credit note , the words one or more credit notes for supplies made in a financial year shall be substituted; (ii) in sub-section (3),- (a) for the words Where a tax invoice has , the words Where one or more tax invoices have shall be substituted; (b) for the words a debit note , the words one or more debit notes for supplies made in a financial year shall be substituted. 16. Amendment of section 35.- In section 35 of the principal Act, in sub-section (5), the following proviso shall be inserted, namely:- Provided that nothing contained in this sub-section shall apply to any department of the Central Government or a State Government or a local authority, whose books of account are s

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the Council, notify certain classes of registered persons who shall pay to the Government the tax due or part thereof as per the return on or before the last date on which he is required to furnish such return, subject to such conditions and safeguards as may be specified therein. ; (iii) in sub-section (9),- (a) for the words in the return to be furnished for the month or quarter during which such omission or incorrect particulars are noticed , the words in such form and manner as may be prescribed shall be substituted; (b) in the proviso, for the words the end of the financial year , the words the end of the financial year to which such details pertain shall be substituted. 18. Insertion of new section 43A.- After section 43 of the principal Act, the following section shall be inserted, namely:- 43A. Procedure for furnishing return and availing input tax credit.- (1) Notwithstanding anything contained in sub-section (2) of section 16, section 37 or section 38, every registered person

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supplies for which the details have been furnished by the supplier under sub-section (3) shall be deemed to be the tax payable by him under the provisions of the Act. (6) The supplier and the recipient of a supply shall be jointly and severally liable to pay tax or to pay the input tax credit availed, as the case may be, in relation to outward supplies for which the details have been furnished under sub-section (3) or sub-section (4) but return thereof has not been furnished. (7) For the purposes of sub-section (6), the recovery shall be made in such manner as may be prescribed and such procedure may provide for non-recovery of an amount of tax or input tax credit wrongly availed not exceeding one thousand rupees. (8) The procedure, safeguards and threshold of the tax amount in relation to outward supplies, the details of which can be furnished under sub-section (3) by a registered person,- (a) within six months of taking registration; (b) who has defaulted in payment of tax and where

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ritory tax shall be utilized towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax; . 21. Insertion of new sections 49A and 49B.- After section 49 of the principal Act, the following sections shall be inserted, namely:- 49A. Utilisation of input tax credit subject to certain conditions.- Notwithstanding anything contained in section 49, the input tax credit on account of State tax shall be utilized towards payment of integrated tax or State tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment. 49B. Order of utilization of the input tax credit.- Notwithstanding anything contained in this Chapter and subject to the provisions of clause (e) and clause (f) of sub-section (5) of section 49, the Government may, on the recommendations of the Council, prescribe the order and manner of utilization of the

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st proviso to sub-section (3), the due date for furnishing of return under section 39 for the period in which such claim for refund arises; . 24. Amendment of section 79.- In section 79 of the principal Act, after sub-section (4), the following Explanation shall be inserted, namely:- Explanation.- For the purposes of this section, the word person shall include distinct persons as referred to in sub-section (4) or, as the case may be, sub-section (5) of section 25. . 25. Amendment of section 107.- In section 107 of the principal Act, in sub-section (6), in clause (b), after the expression arising from the said order, , the expression subject to a maximum of twenty-five crore rupees, shall be inserted. 26. Amendment of section 112.- In section 112 of the principal Act, in sub-section (8), in clause (b), after the expression arising from the said order, , the expression subject to a maximum of fifty crore rupees, shall be inserted. 27. Amendment of section 129.- In section 129 of the prin

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om the 1st day of July, 2017. 32. Amendment of Schedule III.- In Schedule III of the principal Act,- (i) after paragraph 6, the following paragraphs shall be inserted, namely:- 7. Supply of goods from a place outside India to another place outside India without such goods entering into India. 8. (a) Supply of warehoused goods to any person before clearance for home consumption; (b) Supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India but before clearance for home consumption. ; (ii) the existing Explanation shall be numbered as Explanation 1 and after Explanation 1 as so numbered, the following Explanation shall be inserted, namely:- Explanation 2.- For the purposes of paragraph 8, the expression warehoused goods shall have the same meaning as assigned to it in the Customs Act, 1962 (Central Act 52 of 1962). . 33. Repeal and Saving.- (1) The Goa Goods a

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2019 (3) TMI 704 – AUTHORITY FOR ADVANCE RULING – WEST BENGAL – TMI – Levy of IGST – process of appointing CDI Virtual Films Inc.(CDIVF) as a Line Producer in Brazil – Reverse charge mechanism – rate of tax depending upon the classification of the service of a Line Producer – place of supply of services – Held that:- A Line Producer’s job is not limited to arranging hotel accommodation, catering for the filming crew, local transportation and procuring location permits on behalf of the principal. Although he may facilitate the provisioning of a few services where the Applicant reimburses him on an actual cost basis, the Line Producer, being a key member of the production team, supplies the main service on his own account. It involves arranging all logistics for actual shooting, estimating and budgeting the cost of shooting and other residual activities relating to shooting on location. He assists and collaborates with the filming crew of the Applicant in deciding on various issues rela

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so that CDIVF acts as pure agent for certain services in addition to the main supply of motion picture production service, the related transactions will be import of services from the actual suppliers, and the amount paid on actual cost basis for procuring those services will be subjected to IGST at the applicable IGST rate on such services. – Case No. 44 of 2018 Order No. 45/WBAAR/2018-19 Dated:- 26-2-2019 – Mr Sydney D Silva, Joint Commissioner, CGST & CX (Member) and Mr Parthasarathi Dey, Senior Joint Commissioner, SGST (Member) Applicant s representative heard : Rahul Dhanuka, Advocate Preamble A person within the ambit of Section 100 (1) of the Central Goods and Services Act, 2017 or West Bengal Goods and Services Act, 2017 (hereinafter collectively called the GST Act ), if aggrieved by this Ruling, may appeal against it before the West Bengal Appellate Authority for Advance Ruling, constituted under Section 99 of the West Bengal Goods and Services Act, 2017, within a period

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ns raised are admissible for an advance ruling under section 97(2)(a), (b) & (e) of the GST Act, read with section 20(xviii) of the IGST Act, 2017. 1.3 The Applicant declares that the issues raised in the application are not pending nor decided in any proceedings under any provisions of the GST Act. The officer concerned from the revenue has raised no objection to the admissibility of the Application. 1.4 The Application is, therefore, admitted. 2. Submissions of the Applicant 2.1 The Applicant submits, along with the Application, a written submission, including a description of the activity of a Line Producer and the proposed draft for the contract with CDIVF (hereinafter the Contract). The Contract is for the production services . According to clause 5 of the Contract, CDIVF will facilitate the provisioning of the production services. The Applicant will reimburse CDIVF the cost of procuring these services, based on the bills raised by the service providers, bearing the name of th

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licant knows in advance the amount that the foreign supplier shall charge in as much as the budgeted amount is shared by CDIVF in advance. In case of any deviation from the budgeted amount, CDIVF shall pay the foreign supplier after taking concurrence from the Applicant. Moreover, the invoices raised by the foreign suppliers mention the name of the motion picture. 2.4 Without prejudice to the aforesaid, the Applicant further argues that the service of CDIVF can also be classified as event management service, as described under section 13(5) of the IGST Act, 2017. The shooting of the film in foreign locations, resulting in the emergence of a CD containing the filmed materials, is an event that CDIVF is going to organize and manage. 2.5 At the same time, the Applicant argues that CDIVF will act as pure agent, as defined under rule 33. The Contract specifically provides that the Applicant will reimburse CDIVF at the actual cost of procuring these services, based on the bills the service p

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d 28/06/2017. 2.8 Moreover, the Applicant argues that the place of supply being the location of the supplier, the recipient receives the service in Brazil and location of the recipient is, therefore, not within the taxable territory, and no tax is payable on RCM in terms of Sl No. 1 of Notification No. 10/2017 – IGST (Rate) dated 28/06/2017. 3. Submissions of the Revenue 3.1 Concerned officer from the Revenue submits that at the time of signing the Contract the so-called principal suppliers of the services or the services are not clearly identified. The Question of facilitating as an intermediary between the principal suppliers and the recipient, therefore, does not arise. CDIVF is, not, therefore, acting as an intermediary. 4. Observation & Findings of the Authority 4.1. The answer to the question about the liability to pay IGST on the reverse charge on the payments to be made to CDIVF depends upon the location of the recipient of the service. The Applicant, a resident of India, w

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estion of classification of the Line Producer s service is, therefore, to be answered first before determining whether the Applicant is liable to pay IGST on the payments to be made to CDIVF in terms of Sl No. 1 of Notification No. 10/2017 – IGST (Rate) dated 28/06/2017, provided the transaction constitutes an inter-State supply within the meaning of section 7(4) of the IGST Act, 2017. 4.3 SAC 999900 refers to services provided by embassies and representations from other countries, services provided by international organizations such as the United Nations and its specialized agencies or regional bodies, etc., the Organization of American States, the European Union, the African Union, the League of Arab States, the Organization for Economic Cooperation and Development, the World Customs Organization, the Organization of Petroleum Exporting Countries and other international bodies or extraterritorial units (refer to Explanatory Notes on Classification of Services; cbic.gov.in). Service

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er needs to be discussed in this context. Event management services (SAC 998596), as described in section 13(5) of the IGST Act, refers to admission to, or organization of a cultural, artistic, sporting, educational or entertainment event, or a celebration, conference, fair, exhibition or similar events, and services ancillary to such admission or organization . Clearly, any event whatsoever does not fit the bill. It has to be an event of a nature specified above. The emergence of a CD containing footage for a motion picture is not a cultural, artistic, or entertainment or a similar event. It is merely a stage in the process of producing the feature film. Screening of the completed motion picture or, for that matter, of the footage contained in the CD, however, can fit the description of events included in section 13(5) of the IGST Act. CDIVF is not being contracted for organizing such a screening event for the Applicant. CDVIF is not, therefore, supplying services for organizing event

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ice providers mentioned in the petition are Line Producers. Neither has the Tribunal examined whether these commercial services are intermediary in nature. This judgment does not, therefore, throw much light on the question of classifying the service of a Line Producer and, therefore, not applicable in the present case. 4.7 It is evident from the above discussion that the Contract, the Applicant s argument based on the Contract, or the judgment in the case of Yash Raj Film (supra) does not throw sufficient light on the role CDIVF plays as a Line Producer in the production of the film in offshore locations. He is alternately described as an intermediary service provider or an event manager. It is, therefore, pertinent to examine the role of the Line Producer, as understood in common parlance in the film industry. 4.8 A Line Producer is a key member of the production team for a motion picture. Typically, a Line Producer manages the budget of a motion picture. Alternatively, or in additio

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hoot that shows how long it will take to shoot each scene. From this schedule, the Line Producer can accurately estimate the cost of each day's shooting and produce a provisional budget estimating the total amount of funding required. 4.9 During pre-production, Line Producers, working closely with the director, production manager, first assistant director, art director and other heads of department, prepare the production schedule and budget and set the shoot date. Line Producers oversee all other preproduction activities, including hiring the production team, setting up the production office, location scouting, ensuring compliance with regulations and codes of practice, sourcing equipment and suppliers, selecting the crew, engaging supporting artists and contributors, and monitoring the progress of the art department and other production departments. Line Producers are ultimately responsible for overseeing all activities, and for ensuring that the production is completed on time a

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ring during the shooting. His service is, therefore, an integral part of the activity for the production of the feature film. 4.11 The Applicant himself submits that CDIVF is going to organize and manage the shooting in Brazil that will result in the emergence of a CD containing the audio-visual content, and retains as security all production rights and talent buy-outs for such production in Brazil till receiving the final payment from the recipient. Clearly, CDVIF cannot retain production rights and talent buy-outs, even as security, unless it is engaged in the production and realization of a motion picture, explicitly or implicitly protected by copyright, without a contract for outright sale. It is, therefore, provisioning motion picture production service classifiable under SAC 999612. It is, therefore, not an intermediary service. 4.12 The service being supplied is not, therefore, classifiable as the one specified in subsections (3) to (13) of section 13 of the IGST Act, 2017. The

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or services or both; (b) neither intends to hold nor holds any title to the goods or services or both so procured or supplied as a pure agent of the recipient of supply; (c) does not use for his own interest such goods or services so procured; and (d) receives only the actual amount incurred to procure such goods or services in addition to the amount received for supply he provides on his own account. The Contract does not specify CDIVF as the Applicant s pure agent. It merely refers to bills for some of the services procured will bear the name of the feature film and will be paid on an actual cost basis. The crucial test is whether these services are a charge on the Applicant or CDIVF. If CDIVF is liable to pay the suppliers of these services no matter what the Applicant does, it will be treated as a charge on CDIVF. As CDIVF holds the production rights, even though as security, all procurements of goods and services will be a charge on him unless specifically excluded. That the bill

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terms of Sl No. 1 of Notification No. 10/2017 – IGST (Rate) dated 28/06/2017at 18% rate specified under Sl No. 34(vi) of Notification No. 08/2017 – IT (Rate) dated 28/06/2017, as amended from time to time. No deduction is available in terms of the contract with the Line Producer appended to the Application from the value of the supply of motion picture production service even if payment is made on an actual cost basis. However, if the Applicant modifies the contract so that the Line Producer acts as pure agent for certain services in addition to the main supply of motion picture production service, the related transactions will be import of services from the actual suppliers, and the amount paid on actual cost basis for procuring those services will be subjected to IGST at the applicable IGST rate on such services. This Ruling is valid subject to the provisions under Section 103 until and unless declared void under Section 104(1) of the GST Act. – Case laws – Decisions – Judgements –

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GST – Started By: – AKReddy andCO – Dated:- 25-2-2019 Last Replied Date:- 27-2-2019 – Dear Sir, Can anyone help me in deciding whether we have to pay GST on collecting blood samples from patients in India and providing the same to a lab in USA. The USA lab will bill me and i will pay to him, am I need to pay GST under RCM in this transaction. Am I need to charge GST from the patients in India and pay to the Government? – Reply By KASTURI SETHI – The Reply = Dear Querist, This service is exempte

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GST – Started By: – CABIJENDERKUMAR BANSAL – Dated:- 25-2-2019 Last Replied Date:- 26-2-2019 – Query : Tour Operator, XYZ has provided tour package for 6 days to Mr. A, a resident of the USA at US $. 50,000. The itinerary of the package is a follows:-Day 1: Flight from Delhi to JaipurDay 2 & 3: Sightseeing in JaipurDay 4: Flight from Jaipur to Kathmandu NepalDay 5 & 6 : Sightseeing in KathmanduCombined tour package for India and Nepal . is total amount taxable under GST OR portion of Ne

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GST – Started By: – Prem Choudhary – Dated:- 25-2-2019 Last Replied Date:- 27-2-2019 – Dear Expert Please advice for refund provision if any for following Case:- The manufacturer are producing Cement and Clinker under HSN-2526 and Sales within in India. Cement is taxable @28% ( SGST-14% & CGST-14%) and no any GST Compensation Cess is leviable. However in production of Cement, Coal is require to running the Kilan(generating the heat) and on procurement of Coal Cess is leviable @ ₹ 400/- per tone. As per provision of Act, Compensation Cess can be utiliase for payment of out put Cess only. Hence Compensation Cess is going to accumulation. Further, Whether answer will be same if manufacturer is exporting as well selling Cement and Cl

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issue has been clarified vide C.B.I. & C. Circular No. 79/53/2018-GST, dated 31-12-2018. (Point No.9 is relevant). – Reply By Prem Choudhary – The Reply = Thank you Sethi ji for providing reference of provision and clarity, We have gone through the Circular No.-45/19/2018-GST Point no-05 and your reply pint no-(i), Kindly more clarify is require, In our Case Cement sale is within India and having accumulated Compensation Cess ITC. Whether we are eligible to claim refund of accumulated compensation Cess ITC ? – Reply By KASTURI SETHI – The Reply = In view of Board's clarification, you are eligible for refund claim of Compensation Cess as your final product is cement on which cess is not leviable. – Reply By Prem Choudhary – The Repl

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