Goods and Services Tax – Recommendations made during 31st Meeting of the GST Council held on 22nd December, 2018 (New Delhi)-Rate changes – TMI Updates – Highlights
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Goods and Services Tax – GST – Dated:- 22-12-2018 – GST Council in the 31st meeting held on 22nd December, 2018 at New Delhi took following decisions relating to changes in GST rates on goods and services. The decisions of the GST Council have been presented in this note for easy understanding. The same would be given effect to through Gazette notifications/ circulars which shall have force of law. I GST rate reduction on goods which were attracting GST rate of 28% : 28% to 18% Pulleys, transmission shafts and cranks, gear boxes etc., falling under HS Code 8483 Monitors and TVs of upto screen size of 32 inches Re-treaded or used pneumatic tyres of rubber; Power banks of lithium ion batteries. Lithium ion batteries are already at 18%. This
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but unsuitable in that state for immediate consumption. III. GST on solar power generating plant and other renewable energy plants GST rate of 5% rate has been prescribed on renewable energy devices & parts for their manufacture (bio gas plant/solar power based devices, solar power generating system (SGPS) etc) [falling under chapter 84, 85 or 94 of the Tariff]. Other goods or services used in these plants attract applicable GST. Certain disputes have arisen regarding GST rates where specified goods attracting 5% GST are supplied along with services of construction etc and other goods for solar power plant. To resolve the dispute the Council has recommended that in all such cases, the 70% of the gross value shall be deemed as the value
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Goods and Services Tax – GST – Dated:- 22-12-2018 – The GST Council in its 31st meeting held today at New Delhi decided to refer the following issues to Committees / GoM indicated against them: Extending the Composition scheme to small service providers. The rate of tax and threshold limit to be proposed – Law Committee and Fitment Committee. Tax rate on lotteries – Committee of States. Taxation of residential property in real estate sector – Law Committee and Fitment Committee. Threshold limit
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Goods and Services Tax – GST – Dated:- 22-12-2018 – The GST Council in its 31st meeting held today at New Delhi made the following policy recommendations: There would be a single cash ledger for each tax head. The modalities for implementation would be finalised in consultation with GSTN and the Accounting authorities. A scheme of single authority for disbursement of the refund amount sanctioned by either the Centre or the State tax authorities would be implemented on pilot basis. The modalities for the same shall be finalized shortly. The new return filing system shall be introduced on a trial basis from 01.04.2019 and on mandatory basis from 01.07.2019. The due date for furnishing the annual returns in FORM GSTR-9, FORM GSTR-9A and reconciliation statement in FORM GSTR-9C for the Financial Year 2017 – 2018 shall be further extended till 30.06.2019. The following clarificatory changes, inter-alia, shall be carried out in the formats/instructions according to which the annual return /
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may be reported in Table 5D, 5E and 5F of FORM GSTR-9; Verification by taxpayer who is uploading reconciliation statement would be included in FORM GSTR-9C. The due date for furnishing FORM GSTR-8 by e-commerce operators for the months of October, November and December, 2018 shall be extended till 31.01.2019. The due date for submitting FORM GST ITC-04 for the period July 2017 to December 2018 shall be extended till 31.03.2019. ITC in relation to invoices issued by the supplier during FY 2017-18 may be availed by the recipient till the due date for furnishing of FORM GSTR-3B for the month of March, 2019, subject to specified conditions. All the supporting documents/invoices in relation to a claim for refund in FORM GST RFD-01A shall be uploaded electronically on the common portal at the time of filing of the refund application itself, thereby obviating the need for a taxpayer to physically visit a tax office for submission of a refund application. GSTN will enable this functionality on
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hall be re-credited to the electronic credit ledger of the claimant. One more window for completion of migration process is being allowed. The due date for the taxpayers who did not file the complete FORM GST REG-26 but received only a Provisional ID (PID) till 31.12.2017 for furnishing the requisite details to the jurisdictional nodal officer shall be extended till 31.01.2019. Also, the due date for furnishing FORM GSTR-3B and FORM GSTR-1 for the period July, 2017 to February, 2019/quarters July, 2017 to December, 2018 by such taxpayers shall be extended till 31.03.2019. Late fee shall be completely waived for all taxpayers in case FORM GSTR-1, FORM GSTR-3B & FORM GSTR-4 for the months / quarters July, 2017 to September, 2018, are furnished after 22.12.2018 but on or before 31.03.2019. Taxpayers who have not filed the returns for two consecutive tax periods shall be restricted from generating e-way bills. This provision shall be made effective once GSTN/NIC make available the requ
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Goods and Services Tax – GST – Dated:- 22-12-2018 – The GST Council in its 31st meeting held today at New Delhi gave in principle approval to the following amendments in the GST Acts: Creation of a Centralised Appellate Authority for Advance Ruling (AAAR) to deal withcases of conflicting decisions by two or more State Appellate Advance Ruling Authorities on the same issue. Amendment of section 50 of the CGST Act to provide that interest should be charged only on the net tax liability of the tax
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Goods and Services Tax – GST – Dated:- 22-12-2018 – The GST Council in its 31st meeting held today at New Delhi has approved the proposal to form a 7 Member Group of Ministers to study the revenue trend, including analysing the reasons for structural patterns affecting the revenue collection in some of the States. The study would include the underlying reasons for deviation from the revenue collection targets vis a vis original assumptions discussed during the design of GST system, its implemen
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Goods and Services Tax – The composite activity of excavation and moveing / shifting the mineral sand from one place to another, by means of transport by roads/ramps is taxable as Transport of goods a
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Goods and Services Tax – Classification of supply – The Applicant’s activity of printing the Bible under the specific orders received from The Gideons International is a supply of service classifiable
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Goods and Services Tax – Construction of a private railway siding for carriage of coal and oil fuel to Raghunathpur TPS, as described in the agreement between the Applicant and DVC, is a composite sup
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Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 22-12-2018 – We all know that GST is a tax law which is largely an e-tax with every-thing from registration to appeals being filed online and every data is online subject to sharing among tax officials as well as business intelligence by the tax authorities. Tax officials could probe the following transactions or may have reason to initiate enquiries. Following are few illustrative areas which may trigger suspicious business / trade practices in GST regime and raise alert at the revenue authority s end: Substantial carry forward of input tax credit on closing stock as on 30.06.2017 (GST applicable w.e.f. 1.7.2017) . Major changes in incentive or discount policy (Trade discou
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h e-way bills may give leads on fictitious billing. Any substantially high input tax credit claims should raise doubts. Similarly, input tax credit foregone may also be probed. Reconciliation of audited financial statements with returns furnished under GST [Rule 80(3)]. Scrutiny of audit reports if the two auditors (financial / GST) are different. Examination of major changes in business practices / accounting policies post 1.7.2017. Scrutiny of stock transfers, free of cost supplies and dealings with related parties. Wrong carry forward of transitional credits (TRAN-1 return). Input tax credit lapsed due to no duty paying evidence (may be due to cash transactions earlier). There is an anti-profiteering provision (section 171) in GST. Compa
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2018 (12) TMI 1350 – PATIALA HOUSE COURT – TMI – Cancellation of Bail – Wrong availment of Input Tax Credit – opening bogus companies in the name of dummy proprietors and through these companies had issued fake invoices with no actual supply of goods – cancellation of Bail – Held that:- The allegations are clear enough to make out a case falling under clause (b) of sub-section (1) of Sec. 132 of the CGST Act, 2017. The contention of Id. counsel for the accused/applicant that the application for judicial remand of the accused did not disclose the details of the offence except of making of a mention that Sec. 132(1)(b) is alleged, has no merits as admittedly when the application for judicial remand was preferred by the applicant before the Ld. Link MM, the entire record file including the arrest, search and seizures was put up for perusal and consideration.
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The allegations of tax evasion against the accused/ respondent was of less than ? 5 crores and as such taking out the Offence
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buse of the concession granted to the accused in any manner. The satisfaction of the Court, on the basis of material placed on the record of the possibility of the accused absconding is yet another reason justifying the cancellation of bail. However, bail once granted should not be cancelled in a mechanical manner without considering whether any supervening circumstances have rendered it no longer conducive to a fair trial to allow the accused to retain his freedom by enjoying the concession of bail during the trial.
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Not only there are serious allegations against the accused/ respondent of his having made fictitious sales of value of more than ? 200 crores and having consequently caused loss to the government of the GST evasion/wrongful availment of input tax credit of the value of more than ? 27 Crores, it is also alleged that the accused/respondent had indulged in the act of threatening the witnesses who were otherwise coming forward to give their statement to the department/pe
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uced before the Ld. Link Magistrate. On the remand application preferred against them, the Ld. Link MM admitted the accused/ respondent on bail and remanded the co-accused Adesh Jain to judicial custody till 02.08.2018. 3. It is averred that the accused/ respondent Rajesh Jindal and the co-accused Adesh Jain were arrested with the allegations that they were involved in generation of fake invoices by floating dummy companies/firms in the name of poor persons I third persons and of passing on the input tax credit (in short, ITC ) to unscrupulous persons / firms/ companies without actual supply of goods. This was done with the malafide intent to pass on the undue advantage of ITC to various companies / firms for utilizing the bogus GST ITC so generated. In return, accused / respondent and the co-accused were taking commissions at various rates. This activity of the accused/ respondent and of the co-accused was found involving fictitious sales of the value of ₹ 201 crores and of the
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against accused Rajesh Jindal was for a sum of ₹ 4,58,19,883/- which is less than ₹ 5 Crores and as such, the offence u/s 132(1)(b) being punishable under clause (ii) of sub-section (1) (b) of Sec. 132, falls under the category of non-cognizable and bailable and as such accused/ respondent was admitted tobail. As to co-accused Adesh Jain, since the duty evasion was found to be of more than ₹ 27 crores which was punishable u/s 132(1)(b) r/w clause (i), as such he was remanded to JC till 02.082018. 5. It is averred that the Ld.MM while opining the duty of tax evasion to be of less than ERs. 5 crores in respect of accused/ respondent Rajesh Jindal, referred to his statement voluntarily tendered on 01.08.2018 and recorded u/s 70 of the CGST Act, 2017. It is averred that the Ld. MM failed to take into consideration that there was a statement dated 31.07.2018 tendered by the respondent himself wherein he had admitted of his partnership with the Co-accused Adesh Jain. This
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vestigation. 6. It is averred that the modus operandi of the accused/respondent is that he floated various bogus firms by using the name of poor persons. less educated and unemployed individuals by luring them with consideration ranging from ₹ 12,000/- to ₹ 15,000/-. In return, these individuals used to hand over their Aadhar Card, PAN card, bank account details and registered mobile number to the accused/ respondent for using the same for OTP verification in the process of making them become the proprietors of the bogus firms. The accused/ respondent was actively assisted by the co-accused Adesh Jain and that these two used to take documents from the dummy proprietors for its use in government authorities for the purpose of taking Statutory registrations such as GST etc. The accused were aware that the government having eased the norms of operating business, is not requiring any human interface of the dummy proprietor with any of the GST official and the identity of the sa
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Court of Delhi vide its order dated 18.09.2018 giving liberty to the petitioner to approach the Court of Sessions u/s 439(2) Cr.PC. Hence, the present application before this Court has been filed. 8. It is further averred that not only the bail order and order dismissing the cancellation of bail application are illegal, even the accused/respondent after being granted bail had indulged himself in constantly threatening the witnesses and their statements in this regard were recorded, which again is a ground for cancellation of bail of the accused/ respondent. 9. Notice of the application was issued to the accused/respondent and reply to the application came to be filed. In the reply, it has been averred that the application / petition of the applicant I petitioner is based on falsehood and deserves to be rejected with exemplary costs. It is averred that the allegations are false and baseless and there is a deliberate suppression of material facts by the applicant I petitioner. It is aver
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ad, false and vague averments have been made in the application which are not substantiated by any document or material. 10. It is further averred that the application proceeds on a wrong notion that every offence under the CGST Act, 2017 is cognizable and non-bailable. In fact, except of few offences u/s 132 of the Act, all other offences are non-cognizable and bailable. Also, the maximum punishment provided u/s 132 of the Act is of five years and that the accused/ respondent had appeared before the authority as and when he was called upon by issuance and service of summons. As such, the present application is against the spirit and mandate of the law laid down by Hon ble Supreme Court in Arnesh Kumar vs state of Bihar (2014) 8 SCC 273 = 2014 (7) TMI 1143 – SUPREME COURT. 11. It is further averred that petitioner had cleverly concealed in the application that after being granted bail, accused/ respondent was issued summons dated 20.08.2018 seeking appearance on 30.08.2018. However, th
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the facts ought to have been stated so as to make out therefrom that offence u/s 132(1)(b) of the Act is made out. Mere allegation of tax evasion in itself is not sufficient to assume or presume that offence u/s 132 (1)(b) is made out. It is further averred that the application for cancellation of bail which was preferred by the applicant before the Ld. CMM only makes a mention that the amount of duty evasion by accused/ respondent is around 85 crores and therefore the offence is cognizable and non-bailable. Again, there was no allegation of any offence covered in clause (a) to (d) of sub-section (1) of Sec. 132 which are only cognizable and non-bailable. In fact, the Ld. CMM in the order dated 14.08.2018 noted that even the figure 85 seems to be have been inserted subsequently with a pen. Also, the bail Order dated 01.08.2018 clearly mentions that the entire proceedings file prepared by GST (West) has been perused. It is averred that as to the allegation of the accused/respondent ext
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nsel for the applicant/petitioner while making a reiteration of the facts as asserted in the application, placed reliance upon the judgment of Hon ble Supreme Court of India in Prahlad Singh Bhatti vs. NCT of Delhi, AIR 2001 SC 1444 = 2001 (3) TMI 1053 – SUPREME COURT OF INDIA. 15. Ld. Counsel for the accused/ respondent in his submissions also made a reiteration of the averments of the reply and placed reliance upon the following citations:- (i) Arnesh Kumar vs state of Bihar & Anr. (2014) 8 SCC 273 = 2014 (7) TMI 1143 – SUPREME COURT (ii) Ebiz.com Pvt. Ltd. vs union of India 2016 (44) S.T.R 526 = 2016 (9) TMI 53 – DELHI HIGH COURT. (iii) Amrit Foods vs. commissioner. 2005 (190) ELT 433 (SC) = 2005 (10) TMI 96 – SUPREME COURT OF INDIA (iv) Strategic Credit Capital Pvt Ltd. Vs. Ratnakar Bank Ltd, 2018 (9) GSTL 209 (Del.) = 2017 (6) TMI 23 – DELHI HIGH COURT (v) Haiko Logistic India Pvt. Ltd. vs UOI NO. WP(C) No. 7063/16 dated 21.08.2017 (Hon ble High court of Delhi) = 2017 (11) TMI
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or substitutes financial records or produces fake accounts or documents or furnishes any false information with an intention to evade payment of tax due under this Act. (g) obstructs or prevents any officer… (h) acquires possession of, or in any way concerns himself in transporting, removing….. (i) receives or is in any way concerned with the supply, or in any other manner deals with any supply of services…… (j) tampers with or destroys any material evidence or documents. (k) fails to supply any information which he is required……. (l) attempts to commit, or abets the commission of any of the offences mentioned in clause (a) to (k) of this section. shall be punishable:- (i) in cases where the amount of tax evaded or the amount of input tax credit wrongly availed or utilized or the amount of refund wrongly taken exceeds five hundred lakh rupees, with imprisonment for a term which may extend to five years and with fine. (ii) in cases where the amount of tax evaded or
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r clause (d) of sub-section (1) and punishable under clause (i) of that sub-section shall be cognizable and non-bailable. Now, coming on to the facts of the present case, as already, noted, the allegations against the accused/respondent are that he alongwith co-accused Adesh Jain had indulged in the act of opening bogus companies in the name of dummy proprietors and through these companies had issued fake invoices with no actual supply of goods and in this manner had wrongly taken the input tax credit. The allegations are clear enough to make out a case falling under clause (b) of sub-section (1) of Sec. 132 of the CGST Act, 2017. The contention of Id. counsel for the accused/applicant that the application for judicial remand of the accused did not disclose the details of the offence except of making of a mention that Sec. 132(1)(b) is alleged, has no merits as admittedly when the application for judicial remand was preferred by the applicant before the Ld. Link MM, the entire record f
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uch taking out the Offence from the purview of sub-section (5) of Sec. 132 of the Act, thus, making it non-cognizable and bailable. Admittedly, the file which has been produced by the applicant/ petitioner clearly notes in the note-sheet of the inquiry that the accused / respondent as well as the co-accused Adesh Jain in their respective statements recorded u/s 70 of CGST Act on 31.07.2018 have stated that they both were indulging in the act of providing false invoices to other companies I firms/ agents and thus were passing on wrongful availment of input tax credit. They also stated. that they were deducting the commissions for the said act. The total tax evasion as alleged at that time was against both the accused and it was of the value of more than ₹ 27 crores and not of less than ₹ 5 crores against the accused / respondent. Thus, the case against the accused/ respondent as also against the co-accused Adesh Jain was of the offence punishable under clause (i) rlw sec. 13
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preferred before the Ld. CMM did not take any other ground. In respect of Cancellation of bail, the law is well settled that very cogent and overwhelming circumstances are necessary for an order directing the cancellation of the bail, already granted. Generally speaking, the grounds for cancellation of bail, broadly (illustrative and not exhaustive) are:- interference or attempt to interfere with the due course of administration of justice or evasion or attempt to evade the due course of justice or abuse of the concession granted to the accused in any manner. The satisfaction of the Court, on the basis of material placed on the record of the possibility of the accused absconding is yet another reason justifying the cancellation of bail. However, bail once granted should not be cancelled in a mechanical manner without considering whether any supervening circumstances have rendered it no longer conducive to a fair trial to allow the accused to retain his freedom by enjoying the concessi
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the present case. This contention of Id counsel has no basis as this is not the Stage to conduct an inquiry as to the veracity of these statements. The assertion of the department that the accused/respondent is threatening the witnesses and as such is affecting the investigation is based on the statements of the witnesses recorded to the said effect and having been shown during the course of advancing arguments and also of having been filed with the present application. I may also here gainfully refer to the judgment of Hon ble Supreme Court of India in Kanwar Singh Meena vs State of Rajasthan & Anr, Crl. Appeal No. 1662/2012 decided on 16.10.2012 = 2012 (10) TMI 1114 – SUPREME COURT wherein it Was observed that Section 439 of the Code confers very wide powers on the High Court and the Court of Sessions regarding bail. But, while granting bail, the High Court and the Sessions Court are guided by the same considerations as other courts. That is to say, the gravity of the crime, the
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amper with the evidence or interfere or attempt to interfere with the due course of justice or Vade the due Course of justice. But, that is not all. The High Court or the Sessions Court can cancel bail evidence in cases where the order granting bail suffers from serious infirmities resulting in miscarriage of justice. If the court granting bail ignores relevant materials indicating prima facie involvement of the accused or takes into account irrelevant material, which has no relevance to the question of grant of bail to the accused, the High Court or the Sessions Court would be justified in cancelling the bail. Such orders are against the well recognized principles underlying the power to grant bail. Such orders are legally infirm and vulnerable leading to miscarriage of justice and absence of supervening circumstances such as the propensity of the accused to tamper with the evidence, to flee from justice, etc would not deter the court from cancelling the bail. The High Court or the Se
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Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 21-12-2018 – GST Council is meeting on Saturday, 22nd December, 2018, perhaps for the last time in 2018 and for the first time after recent elections in few states. With the dates for filing GST Annual returns already postponed to March 2019, this meeting is likely to focus on GST rate cuts to bring further rationalisation in rate structure in India. This meeting may also address the woes of several trade concerns regarding taxability of certain goods and services, which are widely consumed across India. In view of the fact that India goes to general elections for Parliament in less than six months from now (May, 2019) and the recent state election results, there is going to
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ax be allowed on cash basis or on quarterly basis TDS / TCS may be made non-applicable All types of payment of tax under RCM to be with held Aggregate turnover threshold may be increased for both services and goods Composition scheme to be expanded Rate of interest on delayed payment be reduced for MSMEs. Exemption from audit of accounts under GST, if already audited otherwise Repetitive billing to be allowed on consolidated basis No tax on advance money received Export procedures to be simplified further Time bound processing of refunds pending verification Special facilitation centres for assistance in filing / payment etc No fee on seeking advance ruling Immunity from penalties against procedural irregularities for atleast two years (til
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Goods and Services Tax – Started By: – Kaustubh Karandikar – Dated:- 21-12-2018 Last Replied Date:- 25-12-2018 – In Some cases of dispatch wherein the billing address of the customer is Maharashtra & shipping address is other than Maharashtra. While preparing E-Way Bill GSTIN No is mentioned Bill to party & there in no field to mention the Shipp to Party GSTIN No. in E-Way Bill form. However, recently as informed by the transporters, this will not be acceptable in case of any GST Office
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Goods and Services Tax – Started By: – mohan sehgal – Dated:- 21-12-2018 Last Replied Date:- 25-12-2018 – A registered dealer is availing legal consultancy from an advocate firm interstate..The dealer is in U.P. and the Legal Firm of advocates is in Delhi…The dealer in U.P. has to deposit 18% GST under RCM on the Invoiced value of the legal consultancy…Whether the dealer should deposit the GST amount under RCM in IGST or CGST/SGST ???Thanks in anticipation. – Reply By KASTURI SETHI – The Re
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Goods and Services Tax – Levy of GST – penalty/ liquidated damages – supply of service or not – Whether the Bounce Charges collected by the Applicant should be treated as a supply under the GST regime
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Goods and Services Tax – Levy of GST – Supply of goods or not – pure services – providing energy efficient street lighting services with infrastructure to BMC – pure service should mean pure unadulter
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Goods and Services Tax – Supply – e-way bill – The applicant can issue an e-way bill in which the ‘bill to’ will be mentioned in the name of M/s. RSE/RPG whereas ‘ship to’ would be in the name of fina
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Goods and Services Tax – Rate of GST – supply of non-air conditioned vehicles on hire to Indian Army – Contract carriage – The Service provided by the applicant is not exempted under Notification No.
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Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 21-12-2018 – The orders of Appellate Advance Ruling Authority (AAAR) have started pouring in. In this article, to recent Appellate advance rulings on solar power plants and works contracts in relation thereto are discussed. Appellate advance ruling on works contract and rate of GST (AAR ruling affirmed ) M/s. Fermi Solar Farms Private Ltd. (Appellant) is engaged in operation of renewable energy power plant projects. These typically include operation of solar power plants set up across India for generation and distribution of electricity generated. The appellant is emerging as a leading builder of renewable energy projects. The Appellant filed an Application for Advance Ruling for seeking clarification basis the draft contracts of the Appellant, in view of the provisions of 'composite supply' and the rate of tax provided for Solar Power Generating System under GST. The Appellant sought clarification in respect of
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orks contract' in terms of clause (119) of Section 2 of the GST Act, and hence, should be taxable at the rate of 18% In the absence of any documents, the AAR was not able to deal with the question regarding applicability of concessional rate of tax on parts of solar power generating system in the present proceedings. With regard to the question whether benefit of concessional rate of 5% of SPGS and parts thereof would be available to sub-contractors, it was held that no documents were provided and hence this question was not dealt with in the proceedings. Being aggrieved by the advance ruling, the Appellant preferred the appeal before AAAR belatedly as the AAAR was not constituted. The AAAR condoned the delay. It was ruled that the agreements tendered in support of this question are for setting up and operation of a solar photovoltaic plant and are in the nature of a 'works contract' in terms of clause (119) of section (2) of the GST Act. Schedule II ( Activities to be trea
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photovoltaic plants for supply of power generated. In various cases, the Appellant also is a Project developer wherein it is engaged in operation of renewable energy power plant projects. Typically, a contract is entered into by the Appellant to do end to end setting up of a solar power plant which includes supply of various goods (such as modules, structures, inverter transformer etc.) as well as complete design, engineering and transportation, unloading, storage and site handling, installation and commissioning of all equipments and material, complete project management, civil works/construction related services for setting up of a functional solar power plant. In the instant case, the contract entered into by the Appellant included end to end activities i.e. supply of various goods and services and hence is for the supply of solar power generating system. The intent of the contract is that the entire contract would be undertaken by the Appellant for supply and setting up of the sola
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t the goods and services may be required to fulfill the intention of the buyer in giving the contract. The supply of goods and services are provide as a package and the different elements are integral to flow of supply i.e. one or more is removed, the nature of the supply would be affected. Thus, from a reading of the entire contract as well as from the definition of composite supply what can be easily gathered is that the buyer has given a contract for setting up Solar Power Generating Supply to the appellant and therefore, it is single composite supply of goods and services and installation thereof. The contract for providing the design, procurement, supply, development, testing and commissioning of the plant which includes the supply of both goods and services is a composite supply as per the definition in the Act. There are two taxable supplies- one of goods and the other of services and they both are naturally bundled and it is natural and also a practice to expect that the contra
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2018 (12) TMI 1177 – CESTAT HYDERABAD – TMI – CENVAT Credit – input services – parcel services which were utilised for exports beyond the place of removal – Held that:- Identical issue came up before the Bench of the Tribunal in the case of CCE vs. Imperial Auto Industries [2017 (4) TMI 1048 – CESTAT CHANDIGARH], where it was held that credit on courier and transportation charges to the respondent for transportation of the goods to the foreign buyer premises allowed – credit allowed – appeal allowed – decided in favor of appellant. – APPEAL No. E/30418/2018 – A/31590/2018 – Dated:- 21-12-2018 – Mr. M.V. Ravindran, Member (Judicial) Shri P. Venkata Prasad, Chartered Accountant for the Appellant. Shri A.V.L.N. Chary, Superintendent /AR for the Respondent. ORDER Per: Mr. M.V. Ravindran 1. This appeal is directed against Order-in-Appeal No. HYD-EXCUS-SC- AP2-0173-17-18-ST, dated 09.01.2018. 2. Heard both sides and perused the records. 3. The relevant facts that arise for consideration, af
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ity, after following due process of law, confirmed the demands raised along with interest and also imposed penalties, holding that the place of removal in the case in hand is the factory premises and the responsibility of the appellant ceases the moment cargo is handed over to the carrier/shipping agency. On an appeal, the first appellate authority also held the same view. 4. On careful consideration of the submissions made by both sides, I find that identical issue came up before the Bench of the Tribunal in the case of CCE vs. Imperial Auto Industries [2017-TIOL-2446-CESTAT-CHD]. The entire judgment of the Tribunal is reproduced. The Revenue is in appeal against the impugned order. 2. The facts of the case are that the respondent is engaged in the manufacture of motor vehicles parts. During the course of scrutiny of the records, it was observed that the respondent availed credit on courier/freight services used for delivery/transportation of the goods from port of export to foreign b
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credit availed by the respondents. Aggrieved from the said order, the Revenue is before me. 3. Learned AR submits that in any case of exports, the port of export is the place of removal of the goods and the credit is available to the respondent upto the place of export and not beyond that. He has relied on the CBEC circular No.999/6/2015-Cx dt.28.2.2015 and the decision of the Tribunal in the case of Khanna Industrial Pipes Pv.Ltd.-2016 (43) STR 209 (Tri.-Mum.). 4. On the other hand, learned Counsel for the respondent opposed the contention of the learned AR an submits that the case of Khanna Industrial Pipes Pv. Ltd. is not relevant to the facts of the present case as in that case, the assessee took the credit on business support service, namely, terminal handling charges and documentation charges. In the said case, it is not coming out whether the goods have been delivered to the destination of the buyer or not and delivered the goods upto the premises of the buyers. The ownership re
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both sides and considered the submissions. 6. The Revenue has filed this appeal on the ground that in the case of export of the goods, place of removal is port of export and to that extent, they have relied on para 4 of the circular dated 28.2.2015. which reads as under: 4. In most of the cases, therefore, it would appear that handing over of the goods to the carrier/transporter for further delivery of the goods to the buyer, with the seller not reserving the right of disposal of the goods, would lead to passing on of the property in goods from the seller to the buyer and it is the factory gate or the warehouse or the depot of the manufacturer which would be the place of removal since it is here that the goods are handed over to the transporter for the purpose of transmission to the buyer. It is in this backdrop that the eligibility to Cenvat Credit on related input services has to be determined. 7. It is clarified in the above circular that if the seller does not reserve its right for
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remained with the seller of the goods till the delivery of goods in acceptable condition to the purchaser at his door step (b) the seller bore the risk of loss or damage to the goods during transit to the destination and (c) the freight charges were integral part of the price of goods. 9. Admittedly, the respondent has compiled with these conditions, in that circumstance, I hold that the Commissioner (Appeals) has rightly allowed the credit on courier and transportation charges to the respondent for transportation of the goods to the foreign buyer premises. It is not disputed that the respondent has not paid service tax. Therefore, I do not find any infirmity in the impugned order and the same is upheld and the appeal filed by the Revenue is dismissed. 5. It can be seen from the above reproduced order that the facts in the case in hand and the facts in that case are the same. Since the facts and circumstances of this case being the same, impugned order is set aside and appeal stands a
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2018 (12) TMI 1189 – CESTAT HYDERABAD – TMI – Liability of service tax – amount of tax to be paid on the services rendered by the appellant to SEZ Unit – Held that:- The services is rendered by appellant to SEZ unit and the said SEZ unit is authorised to receive the services without payment of service tax. The provisions of Section 51 of the Special Economic Zone Act, 2005 mandates that the provisions of SEZ Act shall have overriding effect notwithstanding anything inconsistent in any act. The provisions of Section 26 of SEZ Act mandates for exemption of service tax, draw backs and concessions to developer – On holistic reading, the services rendered to an SEZ unit are not taxable, is the settled law.
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There being no dispute that the services rendered by the appellant to an unit in SEZ who was supposed to follow the provisions of the law, which he did not do so, would not mean that appellant should be saddled with the service tax liability – appeal allowed – decided in favor of a
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tor services wherein the description of the services is indicated as Renting cabs for transport service along with heading falling under section 65 (105) and the reasoning given is for transport of employees for business purposes. This letter is signed by the Development Commissioner authorising the said M/s EI Dupont to procure the services from DTA. Undisputedly, during the period in question, appellant did supply the cabs to M/s EI Dupont and did not pay any service tax claiming bonafide belief that services rendered to SEZ unit is not taxable. On scrutiny of records it was noticed and appellant was informed that it needs to be paid. Show cause notice was issued which was contested by the appellant. Adjudicating authority, after following due process of law, confirmed the demands raised and also imposed penalties and demanded interest. The first appellate authority also dismissed the appeal only on the ground that SEZ unit M/s EI Dupont had not filed the declaration required under n
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se of Reliance Ports and Terminals Ltd. Vs. CCE, Rajkot [(2015) 49 GST 630 (CESTAT-AHD.)] and the Bench in that case, following the law laid down by the Tribunal in the case of TATA Consultancy Services Limited, Sujana Metal Products Limited and Intas Pharma Limited held that no service tax liability arises on the service provider. Relevant paras of the said judgment are reproduced. 5. Heard both sides in detail and perused the records. The issue involved in this case is whether service provider is entitled to exemption from payment of Service Tax during the period from 3-3-2005 to 20-5-2005 when such services were provided inside SEZ. Under Notification No. 15/2009-S.T., dated 20-5-2009, exemption from payment of service to the service providers was made available by a suitable amendment in proviso (c) of para 1 of Notification No. 9/2009- S.T., dated 3-3-2009 for the services provided inside SEZ. Before this amendment also, exemption was available to the service recipient by way of r
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.T. and No. 15/2009-S.T. have only operationalized the exemption provided. Para 11 of the above judgment is reproduced below: On true and fair construction of Notifications 9/2009 and 15/2009 issued under Section 93(1) of the Act, considered in the light of overarching 11. provisions of Section 7 and 26(e) of the 2005 Act, the conclusion appears compelling that neither Notification 9/2009 nor 15/2009 disentitle immunity to Service Tax enjoined by the provisions of the 2005 Act. It therefore appears that Notification Nos. 9/2009 and 15/2009 merely contour the process by which the benefit of exemption/immunity to tax is operationalized. Notification Nos. 9/2009 and 15/2009 have provided a facilitative regime whereby a developer or units of SEZ, as recipients of taxable service are enabled the facility of claiming refund of Service Tax, remitted by taxable service providers in relation to the taxable services provided to a unit in a SEZ. On this harmonious construction, the immunity to Se
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4 (32 of 1994) on taxable services provided to a Developer or Unit to carry on the authorized operations in Special Economic Zone. 51. The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act. 7.From the provisions contained in Section 26(1)(e) of the SEZ Act, read with Rule 30(10) of the SEZ Rules, 2006, it can be seen that no Service Tax is payable on the services provided by a service provider to a SEZ unit. Further, Sec. 51 of the SEZ Act also makes an over-riding provision that SEZ Act shall have effect even if there is anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any other law. It is accordingly held that Notification No. 9/2009-S.T. and amended Notification No. 15/2009-S.T. have been only issued to operationalize the exemption
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2018 (12) TMI 1226 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – TMI – Rate of GST – construction of railway siding -r Sl. No 3(v)(a) or Sl No 3(xiii) of Notification no 11/2017-CT(Rate) dated 28.06.2017 – Held that:- The scope of work, as outlined in the Applicant’s agreement with DVC, is that of works contract, as defined under section 2(119) of the GST Act, fit to be called an ‘original work’ within the meaning ascribed to the term in para 2(zs) of Notification No. 12/2017-CT (Rate) dated 28/06/2017, and pertains to ‘railways’, provided it is meant for public carriage of passengers or goods.
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Whether the phrase “public carriage of passenger or goods” prevents a private siding from being included in the definition of ‘railways’ has repeatedly come up for judicial scrutiny. The courts generally held that the phrase ‘public carriage of passengers or goods’ cannot be construed in such manner as to exclude from the ambit of ‘railways’ the sidings built and owned by organizations ot
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ces related to engineering consultancy and monitoring agency to a large number of projects, both of the Government and of the Private Sector, seeks a ruling on whether the rate of GST for the construction of railway siding will be under Sl. No 3(v)(a) or Sl No 3(xiii) of Notification no 11/2017-CT(Rate) dated 28.06.2017 (and analogous notification issued under the WBGST Act), as amended, as applicable (hereinafter referred to as the Rate Notification ) under the CGST/WBGST Acts, 2017 (hereinafter referred to, collectively, as the GST Act ). Advance Ruling is admissible under section 97(2) (a) & (b) of the GST Act. 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. The officer concerned raises no objection to the admission of the Application. The Application is, therefore, admitted. 2. The Application states that Damodar Valley Corporation (hereinafter referred to as D
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ction Management Service for construction of Railway Infrastructure including commissioning of the railway system and advance procurement of railway section and P. way materials. The Construction Management includes procurement of Rails and PSC sleepers with fittings, points and crossings, track fitting etc, construction of railway formation and bridges and procurement of stone ballast as per specifications of the Indian Railways, laying of new P. way with Points and Crossings, procurement and installation of electrical equipment etc. Apart from track laying the work includes the cost of all civil work, signalling and telecommunication, overhead electrification and allied electrical work. The basic cost, including the Applicant s fee, for the project, is estimated to be ₹ 496.69 crore. The Applicant also provides a copy of an agreement with M/s Bridge & Roof Co Ltd – a contractor employed for execution of earthwork in railway formation, construction of minor and major bridges
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t or structures, whether pre-fabricated or otherwise. The term railways is not defined in the GST Act. It, however, is defined under section 2(31) of the Railways Act, 1989, meaning a railway, or any portion of a railway, for the public carriage of passengers or goods, and includes (a) All lands within the fences or other boundary marks indicating the limits of the land appurtenant to a railway; (b) All lines of rails, sidings, or yards, or branches used for the purpose of, or in connection with, a railway; (c) All electric traction equipment, power supply and distribution installations used for the purpose of, or in connection with, a railway; (d) All rolling stock, stations, offices, warehouses, wharves, workshops, manufactories, fixed plant and machinery, roads and streets, running rooms, rest houses, institutes, hospitals, waterworks and water supply installations, staff dwellings and any other works constructed for purpose of, or in connection with, railway; (e) All vehicles which
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eaning ascribed to the term in para 2(zs) of Notification No. 12/2017-CT (Rate) dated 28/06/2017, and pertains to railways , provided it is meant for public carriage of passengers or goods. 6. Whether the phrase public carriage of passenger or goods prevents a private siding from being included in the definition of railways has repeatedly come up for judicial scrutiny. The courts generally held that the phrase public carriage of passengers or goods cannot be construed in such manner as to exclude from the ambit of railways the sidings built and owned by organizations other than the government. [Cases relied upon: DMRC -vs- Municipal Corporation of Delhi, 2008 (103) DRJ 369 (Delhi High Court) = 2008 (5) TMI 647 – DELHI HIGH COURT; Commissioner, Central Excise, Raipur -vs- Anand Construction, 2017 (51) STR 435 (CESTAT, Principal Bench, New Delhi) = 2017 (9) TMI 81 – CESTAT NEW DELHI; SMS Infrastructure Ltd -vs- Commissioner, Central Excise, Nagpur, 2017 (47) STR 17 (CESTAT, West Zonal Be
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2018 (12) TMI 1227 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – TMI – Classification of supply – supply of goods or supply of services? – export of services or not – activities undertaken by procuring orders from a foreign party to print religious texts and thereafter deliver them to various places in India – Held that:- The Applicant is supplying the service of printing the Bible (the purchase orders and the tax invoice refer to supplying of printing service classifiable under heading 9989) to the recipient located in India – also, the Applicant’s supply is not the export of service, as the recipient of the service is located in India. It violates clause (b) of section 2(6) of the IGST Act.
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Furthermore, both the purchase orders and the tax invoice are in INR. Although the Applicant argues that the consideration is being received in US dollars, he has not clarified nor produced any evidence of how payment for purchase orders in INR and tax invoice raised in INR are made in fore
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supply of goods or supply of services . The Applicant also seeks a Ruling as to whether this activity can be classified as export . Advance Ruling is admissible on the first question under section 97(2)(a) of the CGST/ WBGST Acts, 2017 (hereinafter referred to, collectively, as the GST Act ). The definition of export however, falls under section 2(6) of the Integrated Goods and Services Act, 2017 (hereinafter referred to as the IGST Act ) and a ruling thereon is out of the purview of this Authority. However, inherent to the concept of whether or not a supply is to be considered as export is the issue of determination of liability to pay tax on any supply of goods or services, or both, which is admissible for consideration under section 97(2)(e) of the GST Act. The Applicant further submits that the question raised in the Application is neither decided by nor pending for decision before any authority under any provisions of the GST Act. The officer concerned raises no objection to the
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se versions. 3. It is clear from the above that the rights of the content of the printed matter do not lie with the Applicant. At best it can be said that the Applicant is providing a composite supply wherein the supply of printing a content, rights of which lie with another and thus debarring all likelihood of transfer of title from the Applicant, is the principal supply and the physical inputs, such as paper, ink, binding material, labour etc., are ancillary to this principal supply. 4. TRU Clarification issued under F. No. 354/263/2017-TRU dated 20th October 2017 by the Ministry of Finance, Department of Revenue, Government of India, clearly states in Serial no. 4 that:- In case of printing of books, pamphlets, brochures, annual reports, and the like, where only content is supplied by the publisher or the person who owns the usage rights to the intangible inputs while the physical inputs including paper used for printing belongs to the printer, supply of printing [of content supplie
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re required to be delivered to the recipient s branch in India. This apart, as evident from the tax invoice and from the Applicant s written submission, persons specified by the recipient and located in India also take delivery on behalf of The Gideons International. Such persons, who receive the supply on belalf of the recipient, are also considered recipient, as defined under section 2(93) of the GST Act. The Applicant is, therefore, supplying the service of printing the Bible (the purchase orders and the tax invoice refer to supplying of printing service classifiable under heading 9989) to the recipient located in India. According to section 2(6) of the IGST Act, export of services means the supply of any service when a) the supplier of service is located in India; b) the recipient of service is located outside India; c) the place of supply of service is outside India; d) the payment for such service has been received by the supplier of service in convertible foreign exchange; and e
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2018 (12) TMI 1277 – AUTHORITY FOR ADVANCE RULINGS WEST BENGAL – TMI – Classification of supply – rate of tax – Composite Contract or Works Contract? – tender received from the Indian Railways for retro-fitment of Twin Pipe Air Brake Systems on wagons – principal supply – Twin Pipe Air Brake Systems or the supply of services of fitting these goods to the wagons?
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Held that:- The contract referred to by the Applicant is that of a composite supply within the meaning of Section 2(30), where the Twin Pipe Air Brake Systems are the Principal Supply as defined under Section 2(90) ibid. The entire contract value is, therefore, taxable at the rate applicable for supply of Twin Pipe Air Brake Systems – Twin Pipe Air Brake System is classifiable under Tariff Head 8607 21 00 [Parts of Railway.. ..Air Brakes and part thereof] which is taxable @ 5% under Serial No. 241 of Schedule I of Notification No. 01/2017 – CT (Rate) dated 28/06/2017 with no benefit of refund of the unutilized input tax
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ons, seeks a Ruling as to whether such activity under contract is to be treated as Composite Contract or Works Contract, and If it is determined to be a Composite Contact, whether the Principal Supply will be the supply of the Twin Pipe Air Brake Systems or the supply of services of fitting these goods to the wagons, and what should be the appropriate classification of the supply and rate of tax. Advance Ruling is admissible on these questions under Section 97(2) (a), (e) & (g) of the CGST / WBGST Act, 2017 (hereinafter referred to as the GST Act ). The Applicant further submits that the question raised in the Application is neither decided by nor pending for decision before any authority under any provisions of the GST Act. The officer concerned raises no objection. The Application is, therefore, admitted. 2. The Applicant submits that the scope of work conforms to the requirements of the Railway Technical Bulletin. The materials will be supplied by the Applicant as per the RDSO s
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contract value, and, hence, should be treated as the predominant element of the supply. The service of fitting the brake to the wagon, the Applicant submits, is ancillary to the supply of these goods. 4. The contract is for retro-fitment of twin pipe air brake system on wagons. Retro-fitment of twin pipe air brake system involves supply of goods, the air brake system, and supply of service for fabrication and assembling of the air brake system on the wagons. The term retro-fitment indicates the wagons that have otherwise been in operation are being upgraded by fitment of the twin pipe air brake system. Section 2(119) of the GST Act defines works contract as a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such co
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course of business. 6. In the context of the contract, the supply of the service of fitting the Twin Pipe Air Brake Systems to the wagon cannot be made unless the goods have already been supplied. The supply of services of the fitting is, therefore, dependent upon and ancillary to supply of the Twin Pipe Air Brake Systems. Predominant supply is, therefore, of the Twin Pipe Air Brake Systems, which constitutes essence of the contract. 7. Section 2(30) of the GST Act defines composite supply as a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply . Again, Section 2(90) of the GST Act defines principal supply as the supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of t
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2018 (12) TMI 1353 – BOMBAY HIGH COURT – TMI – Repayment of borrowed funds – entertainment tax – Held that:- The issue is required to be examined at the highest level before the Government. We request the Government i.e the Chief Secretary to constitute a High Level Committee which would besides others, comprise of Principal Secretary of Finance and the Secretary of Tourism Department – appeal allowed by way of remand. – WRIT PETITION NO. 3027 OF 2018 Dated:- 21-12-2018 – AKIL KURESHI & M.S. SANKLECHA, JJ. Mr. Abhishek Rastogi a/w Mr. Ankit Shah, Ms. Rashmi Deshpande i/by Khaitan & Co for the Petitioner Mr. S.P. Bharti for Respondent No. 5 Mr. Himanshu Takke, AGP for Respondent Nos. 3 and 4 Mr. Pradeep S. Jetly a/w Mr. J.B. Mishra
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t tax was subsumed. The GST currently prescribed is @ 18%. As a result of these changes, according to the petitioner, two things happened. First is, since the entertainment tax was abolished, the incentive offered to the petitioner no longer survived. Secondly, the petitioner would now have to pay tax @ 18% of GST at par with other entities. According to the petitioner, this made the petitioner's business totally unviable. The petitioner had borrowed funds from banks and financial institutions for making capital investment which the petitioner was unable to repay on time. 3. Learned counsel for the petitioner submitted that the petitioner was granted incentive under the state tourism policy. The petitioner was unable to recover even its
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tten to the Government taking up the cause of the petitioner. 4. In our opinion, the issue is required to be examined at the highest level before the Government. We request the Government i.e the Chief Secretary to constitute a High Level Committee which would besides others, comprise of Principal Secretary of Finance and the Secretary of Tourism Department. An authorized representative of the petitioner may also be given a chance of representation and if needed, be given personal hearing by such committee. The petitioner would make a representation to the Committee through Secretary of Tourism which may be done latest by 5.1.2019. 5. The conclusions of the Committee in the form of recommendations may be placed before the Government. The sa
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