Author: admin_gst

In Re: WEBFIL Ltd.
GST
2019 (1) TMI 486 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – 2019 (21) G. S. T. L. 80 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULING, WEST BENGAL – AAR
Dated:- 8-1-2019
Case No 30 of 2018 Order No. 32/WBAAR/2018-19
GST
SYDNEY D'SILVA AND PARTHASARATHI DEY, MEMBER
Applicant's representative heard Sri Jaydip Guha Ray, Authorized Representative
1. The Applicant, stated to be a joint venture company formed by West Bengal Industrial Development Corporation (hereinafter WBIDC) – a Govt of West Bengal undertaking, and the group of companies of Andrew Yule & Co Ltd (a Central Govt under taking), wants a ruling on applicability of Notification No. 1344 – FT dated 13/09/2018 under the WBGST Act, 2017 (50/2018 – CT dated 13/09/2018 under the CGST Act, 2017), which are hereinafter collectively referred to as “the Notification”. Advance Ruling is admissible on this question under Section 97(2) (b) of the CGST / WBGST Act, 2017 (hereinafter referred to

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above, and to the persons specified below under clause (d) of section 51(1):
(a) An authority or a board or any other body –
(i) set up by an Act of Parliament or a State Legislature; or
(ii) established by any Government,
with 51% or more participation by way of equity or control, to carry out any function
(b) Society established by the Central Govt or the State Govt or a local authority under the Societies Registration Act, 1860;
(c) Public sector undertakings.
However, the Notification shall not apply to the authorities under the Ministry of Defence, other than the authorities specified in the Annexure-A of Notification No. 57/2018 – CT dated 30/10/2018. Furthermore, the Notification shall not apply to supplies from a public sector undertaking to another public sector undertaking.
3. According to the Application, WBIDC and Andrew Yule & Co and its associates are “Government Companies” and they together hold 62.29% of the subscribed and paid up share capital of the Applican

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ment. The Application is silent on this issue. This Authority, therefore, examines the matter based on the arguments put forward and information made available, keeping the above issue open.
5. Section 51(1) of the GST Act, read with the Notification as amended from time to time, mandates that certain categories of recipients shall deduct tax at source at a percentage while making payments to the suppliers above a threshold. Such recipients include inter alia an authority or a board or any other body set up by an Act of Parliament or a State Legislature or established by any Government with 51% or more participation by way of equity or control to carry out any function.
As the GST Act does not define “Control”, it should be construed as defined under the Companies Act, 2013. Section 2(27) of the Companies Act, 2013 defines “Control”. It includes the right to appoint majority of the directors or to control the management or policy decisions exercisable by a person or persons acting in

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In Re: M/s. U.S. Polytech
GST
2019 (1) TMI 487 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – 2019 (21) G. S. T. L. 76 (A. A. R. – GST), [2019] 64 G S.T.R. 133 (AAR)
AUTHORITY FOR ADVANCE RULING, WEST BENGAL – AAR
Dated:- 8-1-2019
Case Number 31 of 2018 Order no. 31/WBAAR/2018-19
GST
SYDNEY D'SILVA AND PARTHASARATHI DEY, MEMBER
Applicant's representative heard Shri Dipak Agarwal
1. The Applicant, stated to be a manufacturer of Polypropylene Non-Woven Bags seeks a Ruling on Classification of and Rate of Tax applicable on the above goods under the CGST/WBGST Acts, 2017 (hereinafter referred to, collectively, as “the GST Act”).
Advance Ruling is admissible under sub-clauses (a) and (e) of section 97(2) 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

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Applicant relies on the order passed in case of the Office of the Commissioner of Central GST & Central Excise, Madurai vide C.No. IV/16/84/2017 -Tech (GST) Vol I dated 01.01.2018 that Non-woven bags and rice bags falling under HSN 6305 90 00 of Custom Tariff will attract GST @5% (SGST 2.5% and CGST 2.5%), if sale value does not exceed Rs. 1000/- and GST @ 12% (SGST 6% and CGST 6%) is sale value exceeds Rs. 1000/-
The Applicant also submits the order of AAR, Kerala wherein bags of non-woven fabrics are classified under Entry 224 of Schedule 1 of Notification 01/2017-Central Tax (Rate) dated 28.06.2018.
During Hearing the Applicant submits a copy of order No C3/17556/09/CT dated 29.09.2009 issued by the Department of Commercial Taxes, Kerala, in which it is clarified that non woven fabrics made of Polypropylene would fall under the general heading of 5603 of the Customs Tariff Act and under Entry 103 of SRO No 82/2006, and Packing Bags, textile bags and carry bags made out of non wove

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HORITY FOR ADVANCE RULINGS, KERALA and seeks to clarify whether the Applicant can also apply the same rate as stated in the Advance Ruling.
5. The Applicant has referred to a registration granted by the Office of the Textile Commissioner of Textile-based products, but has not submitted any copy of the Registration, nor has clarified, neither in the Application or during Hearing, the parameters that were examined and approved before the issuance of the Registration. Neither is there provided a list of the products which were found to be textile based.
Thence, the Registration granted to the Applicant by the Office of the Textile Commissioner of Textile-based products cannot be taken up for consideration by this Authority;
The Applicant's reference to the communication from the Office of the Commissioner GST & Central Excise, Madurai is also of little relevance. The above communication has been made to The Madurai Non Woven Bag & Cotton Bag Manufacturer Association in response to a sp

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uous single filament which is called polypropylene filament. The filament are lapped on each other on a lapper and then subjected to thermal bonding to form the polypropylene sheet.
JJ Fabric also submitted that the bags made out of these Polypropylene Sheets are used by industrial units, big retail outlets and textile shops for packing their commodities.  
In light of the submission in the Application that the product manufactured by the Applicant is the same as that taken up by the Authority of Advance Ruling, Kerala, and the sample submitted by the Applicant, and in the absence of any contrary independent information provided by the Applicant, it is to be assumed that raw material of the non woven bags manufactured by them is Polypropylene, the manufacturing process involves obtaining a continuous single polypropylene filament, portions of which is lapped on each other on a lapper and then subject to thermal bonding to form a polypropylene sheet from which bags are made, whic

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shion a bag, it is evident, from the sample bag submitted by the Applicant during Hearing that the bags manufactured are not from “strips”.
Tariff item 6305 33 00, therefore, will not be an appropriate classification for the bags manufactured by the Applicant.
8. In its order dated 26/10/2018, disposing Appeal Case No. 06/WBAAAR/Appeal/2018 dated 08/08/2018 = 2018 (11) TMI 663 – APPELLATE AUTHORITY FOR ADVANCE RULING, WEST BENGAL, the West Bengal Appellate Authority for Advance Ruling (hereinafter the Appellate Authority) refers to the judgment in the case of Raj Pack Well Ltd [1993 (41) ECC 285 (Madhya Pradesh)] = 1989 (9) TMI 120 – HIGH COURT OF MADHYA PRADESH AT INDORE. In the aforesaid case the High Court examines the meaning of textile and fibre under sections 2(g) and 2(a) respectively of the Textile Committee Act, 1963, and concludes that plastic is not included in either textile or fibre. It examines the process of manufacturing HDPE woven bags and observes that they are made

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or the production of non woven fabric. Polypropylene sheets are stitched into bags.  
Note 1 to Chapter 39 of the GST Tariff clarifies that throughout the nomenclature the expression “plastics” means those materials of headings 39.01 to 39.14 (Primary forms of Polypropylene is classified under HSN 3902) which are or have been capable, either at the moment of polymerisation or at some subsequent stage, of being formed under external influence (usually heat and pressure, if necessary with a solvent or plasticiser) by moulding, casting, extruding, rolling or other process into shapes which are retained on the removal of the external influence. Polypropylene sheets are, therefore, plastic, and, applying the ratio of the judgment in the matter of Raj Pack Well Ltd (supra), bags made from Polypropylene sheets are to be classified as plastic goods under Chapter 39.
Sub-heading 3923 29 covers articles of conveyance or packing of goods, namely sacks and bags, made of plastics other than

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In Re: M/s. GGL Hotel And Resort Company Limited
GST
2019 (1) TMI 488 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – [2019] 61 G S.T.R. 302 (AAR), 2019 (21) G. S. T. L. 69 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULING, WEST BENGAL – AAR
Dated:- 8-1-2019
Case No 32 of 2018 32 Order No. 30/WBAAR/2018-19
GST
SYDNEY D'SILVA AND PARTHASARATHI DEY, MEMBER
Applicant's representative Sri Rip Das, FCA Sri Rahul Gupta, FCA Sri Saurav Sharma, CS
1. The Applicant, stated to be in the hospitality and real estate business and is contemplating a new project on a leasehold land, seeks a ruling as to whether Input Tax Credit is available for lease rent paid during pre-operative period for the leasehold land on which the resort is being constructed to be used for furtherance of business, when the same is capitalised and treated as capital expenditure. Advance Ruling is admissible on the question under Section 97(2) sub-clause (d) of the CGST/ WBGST Acts, 2017 (hereinafter referred

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second year, and the same would be escalated at the rate of 5% per annum, in the subsequent years from the start of the third year over the last annual lease rent per annum.
The project is proposed to be completed within a period of two years from the foundation of the project and the lease rent paid during the pre-operative period shall be capitalized in the books of account by the Applicant.
The concerned officer submits in writing that credit of tax paid on goods and services used for construction of immovable property is allowed only if such immovable property is in the nature of plant and machinery. The expression plant and machinery has been defined vide Explanation to section 17 in Chapter V of the GST Act to mean apparatus, equipment , and machinery fixed to earth by foundation or structural support that are used for making outward supply of goods or services and includes such foundation and structural supports but excludes inter alia land, building, or any other civil struc

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ut tax credit shall not be available in respect of the following, namely:
goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business.
The expression “construction” is explained to include re-construction, renovation, additions or alterations or repairs, to the extent of capitalisation, to the said immovable property
(c) The GST Act does not define the exact nature of the goods and services received that are deemed to relate to construction of immovable property. As a result, the meaning of construction cost is to be construed as is taken in the modern parlance. The Applicant is required to pay the lease rent to the Lessor whether or not the construction has been carried out and shall be paying the lease amount even after the completion of the construction of the immovable property for the balance peri

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g the same principles as for an acquired asset, and it is usually the same as the cost of constructing an asset for sale. When an immovable property like a building is sold the profit is computed after deducting from the sale proceeds the cost of the property, including the land. The cost of constructing the immovable asset, therefore, includes the lease rental paid for right to use the land on which the asset is built. Being an integral part of the cost of the immovable property the lease rental paid for the service of right to use the land is a supply for construction of the said property.
The Applicant's argument about absence of any nexus – direct or indirect – between the lease rental and construction of the buildings for hotel etc. is incorrect. Construction of the hotel etc. is impossible unless the Applicant enjoys uninterrupted right to use the land. It is clear from the Agreement that the Applicant cannot enjoy that right if he fails to pay the lease rental. Construction of

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tructed on the Applicant's own account and treated as fixed asset, including the lease rental paid. Whether the lease rental paid for the pre-operative period is capitalized under the head 'Leasehold Land' or 'Building Block' is of little significance in this context.
In the light of the above discussion, it is held that the lease rental paid during the pre-operative period should be treated as part of the cost of goods and services received for the purpose of constructing an immovable property (other than plant and machinery) on the Applicant's own account. Input tax credit is, therefore, not admissible on such lease rental in terms of section 17(5)(d) of the GST Act.
In view of the foregoing we rule as under
RULING
Input Tax Credit is not available to the Applicant for lease rent paid during pre-operative period for the leasehold land on which the resort is being constructed on his own account to be used for furtherance of business, when the same is being capitalised and treated

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M/s Malwa Golden Transolutions LLP Versus State of Haryana and ors.
GST
2019 (1) TMI 551 – PUNJAB AND HARYANA HIGH COURT – TMI
PUNJAB AND HARYANA HIGH COURT – HC
Dated:- 8-1-2019
CWP-40476-2018
GST
MR AJAY KUMAR MITTAL AND MRS MANJARI NEHRU KAUL. JJ.
For The Petitioner : Mr. Aman Bansal, Advocate
ORDER
Ajay Kumar Mittal, J.
The instant petition has been filed under Article 226 of the Constitution of India for issuance of a writ in the nature of Certiorari for setting aside the notice No.00004 dated Nil (Annexure P-3) passed by respondent No.4 on the ground that it is not legally sustainable in the eyes of law, which is in violation of the provisions like Section 129 of the Haryana Goods and Service Tax Act, 2017.

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Q&Q Research Insights Pvt. Ltd. Versus CCGST & CX, Mumbai
Service Tax
2019 (1) TMI 566 – CESTAT MUMBAI – TMI
CESTAT MUMBAI – AT
Dated:- 8-1-2019
Appeal No. ST//86692/2018 – A/85025/2019
Service Tax
Dr. Suvendu Kumar Pati, Member (Judicial)
Shri Bipin Kumar Sinha, Consultant for the appellant
Shri Dilip Shinde, AC (AR) for the respondent
ORDER
Confirmation of penalty of Rs. 41,04,525/- under section 78 of the Finance Act by the Commissioner (Appeals) of CGST & CX, Thane by upholding the OIO is assailed in this appeal.
2. Factual backdrop of the case is that the appellant is engaged in providing marketing and research agency services to various companies and has registered it under service tax. For the financial year 2013-14 and 2014-15, it filed ST3 return belatedly for the period from April to September 2013 on 04.04.2014 and for the period from October 2013 to March 2014 on 05.04.2014. Vide show-cause notice dated 28.09.2014 issued under section 73(1) it w

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alty under section 78 of the Finance Act is erroneous. In citing decision reported in Uniworth 2013 (288) ELT 161 (SC) along with other decisions included Larsen & Toubro reported in 2007 (211) ELT 513 (SC) the ld. Counsel for the appellant argued that no such allegation is made in the show-cause notice to attract penalty and therefore the entire penalty of Rs. 4104,525/- under section 78 of the Finance Act is unsustainable. He further pointed out that in all those cases, the cardinal principle of law set was the burden of proof to establish any malafide was on the department and there was no averment that duty of excise has been intentionally evaded or fraud or collusion has been practiced or there was any mis-statement or suppression of fact for which he prayed to set aside the order of the Commissioner (Appeals).
4. In response to such submissions, ld. AR for the department supported the reasoning and rationality of the order passed by the Commissioner (Appeals) and argued that whe

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nly due to the fact that it had failed to furnish proof during assessment that it had fulfilled the criteria of “pure agent” as laid down under Rule 5 and failed to discharge service tax liability under reverse charge mechanism on payment made to the Directors. Show-cause also indicated that appellant had failed to charge and pay the service tax on the value received as pure agent and value of director service for which it had contravened the provision of Section 68 of the Finance Act. There is nothing available in the show-cause that such contravention of the Act or Rule was made with an intent to evade payment of service tax. On the other hand, the show-cause notice indicates that appellant had failed to discharge the same and such use of word that appellant had failed to discharge the service tax is also found in the OIO and OIA. Further on close scrutiny of the order of Commissioner (Appeals), it is noticed that appellant had produced 14 plus 12 invoices in support of its claim as

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as it may, when appellant had not challenged the same those point needs no further discussion except for the purpose that availment of benefits as pure agent was asserted by the appellant and denied by the revenue authority in which case it cannot be said that such denial has attained finality and appellant had therefore contravened the provisions of the Act Rule as contemplated in Section 73(1) proviso.
5.1. Likewise in borrowing Section 194J of the Income Tax Act which made remuneration made to the director as taxable without distinction of the payment if made to the directors as salary or remuneration, the Commissioner had confirmed the invocation of notification no.30/2012-ST dated 20.06.2012 that was made effective from July 2012 and demanded tax liability under reverse charge mechanism. Therefore, it cannot be said that appellant had not followed the provisions contained in Chapter of Finance Act or in the Rule made thereunder since under erroneous interpretation of the provisio

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M/s. Tamil Nadu Power Finance & Infrastructure Development Corporation Limited Versus Directorate General of Goods and Service Tax Intelligence
Service Tax
2019 (1) TMI 1122 – MADRAS HIGH COURT – TMI
MADRAS HIGH COURT – HC
Dated:- 8-1-2019
W.P.No.34311 of 2018 And W.M.P.No.39942 of 2018
Service Tax
Mr. Justice K. Ravichandrabaabu
For the Petitioner : Mr.S.Muthuvenkataraman
For the Respondent : Mr.V.Sundareswaran Standing Counsel
ORDER
The petitioner seeks for Mandamus to refrain the respondent from issuing any further summons.
2. Heard both sides.
3. The petitioner is a Company represented by its General Manager (Finance). The respondent alleged that the petitioner Company has not discharged appropriate service t

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he power to issue summons by the respondent cannot be curtailed when the matter is pending at the stage of investigation. However, as it is expressed by the petitioner that she made several appearance before the respondent, this Court is of the view that the respondent has to complete the examination of the petitioner by next hearing date. The learned counsel for the respondent submit that the petitioner can appear on 11.01.2019 at 11:00 AM in the morning before the respondent, so that the examination can be completed on that day. He has also submitted that the petitioner should co-operate with the investigation.
7. Needless to say that the petitioner should co-operate and appear on the said day so that the examination can be completed on

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Shree Mahavira Buildwell Pvt. Ltd. Versus Commissioner of Central GST & Central Excise, Patna, Principal Commissioner of Central Excise & Service Tax, Patna, Commissioner of Central Excise & Service Tax, Patna And Superintendent of Central GST & Central Excise, Patna
Service Tax
2019 (2) TMI 1180 – PATNA HIGH COURT – TMI
PATNA HIGH COURT – HC
Dated:- 8-1-2019
Civil Writ Jurisdiction Case No.19805 of 20
Service Tax
Mr. Justice Jyoti Saran And Mr. Justice Arvind Srivastava
For the Petitioner : Mr.D.V. Pathy, Adv.
For the Respondent : Mr.Anjani Kumar Sharan, ASG
ORDER
The petitioner questions the order dated 27.06.2018 impugned at Annexure-6 passed by the respondent No. 1 confirming the demand of service tax for the p

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eries have not been considered.
Mr. Sharan has invited our attention to the order impugned at Annexure-6 to demonstrate that there is application of mind by the authority to reject the claim so put forth. According to Mr. Sharan all the issues as raised by Mr. Pathy have been dealt and if the petitioner is not satisfied it can be raised by the petitioner in the statutory appeal so available under the Finance Act.
We are in agreement with the objection so taken by Mr. Sharan and thus while allowing the petitioner to raise all the issues so raised herein or any other issue, in the statutory appeal so available to him under the Finance Act, we dispose of the writ petition.
Mr. Pathy informs that the statutory period for filing such appeal h

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ITC for transportation of employees in bus
Query (Issue) Started By: – Madhavan iyengar Dated:- 7-1-2019 Last Reply Date:- 23-10-2019 Goods and Services Tax – GST
Got 13 Replies
GST
A Vehicle operator has a 50 seater bus, and has a contract with a company for pick up and drop of employees of company to factory in the 50 seater bus,
He levies 12% GST can company get ITC on the Charges paid to the vehicle operator. SAC code 996601
issue: ITC eligibility under current law and post amendment 01/02/2019
Reply By DR.MARIAPPAN GOVINDARAJAN:
The Reply:
In my view it is eligible.
Reply By KASTURI SETHI:
The Reply:
I support the view of Dr.Govindarajan, Sir.
I am also of the view that if any supplier of goods or services hires b

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h pick drop of employees is not obligatory for employers.
Reply By Madhavan iyengar:
The Reply:
sirs please see this judgement of haryana aar where they have held that irrespective of the seating capacity vehicles carrying passengers will fall under rent a cab and covered by disallowance u/sec 17(5)
AAR judgement in ref: HAR/HAAR/R/2018-19 = 2019 (2) TMI 1081 – AUTHORITY FOR ADVANCE RULING, HARYANA.
experts pls enlighten
Reply By Bipin Parmar:
The Reply:
Dear Kasturi Sir,
I'm still confused. Section 17(5)(b)(iii) says ITC on travel benefits extended to employees would be available only if it's obligatory for the employer to provide. However here as you said it's not obligatory for the employer to provide such travel benef

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AAR Haryana has discussed /covered all the aspects including the issue of 'Obligatory for the employer-'. The applicant in this case could not prove that Rent-a-cab was obligatory on the part of employer to provide this service to their employees'.
Reply By Harsha Dattani:
The Reply:
Dear Expert,
We have transport facility for staff from station to office in bus of 50 capacity, our transporter not charging us GST, whether we need to pay RCM @5% and can claim input credit.
Please reply
Harsha
Reply By KASTURI SETHI:
The Reply:
Hiring bus is not under RCM.
Reply By Bharat Sharma:
The Reply:
Hello,
My doubt is that is this ITC availment conflicting with the Schedule 1 of CGST Act ?
If the bus services are provided to Emp

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Anti-profiteering provisions
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
25. Anti-profiteering provisions
Q 1.  What is profiteering?
Ans. In terms of Section 171 of the CGST Act, 2017, the suppliers of goods and services should pass on the benefit of any reduction in the rate of tax or the benefit of input tax credit to the recipients by way of commensurate reduction in prices. The wilful action of not passing on the above benefits to the recipients in the manner prescribed is known as “profiteering”.
Q 2. What is the background to providing statutory provisions on anti-profiteering in GST law?
Ans. The Study Report titled 'Implementation of Value Added Tax (VAT) in India-Lessons for transition to GST' released by the Comptroller & Auditor General (C&AG) of India in June, 2010 mentioned about several cases of profiteering by dealers by not passing on the benefit of tax rate reduction to the consumers in the wake of implementation

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. Yes. In terms of Rule 137 of the CGST Rules, 2017, the Anti-profiteering Authority shall cease to exist after the expiry of two years from the date on which the Chairman of the Authority enters upon his office unless the GST Council recommends otherwise.
Q 5. What are some of the instances in which the statutory provisions of anti-profiteering will kick in?
Ans. The different situations in which Section 171 of CGST Act, 2017 & the identical provision in State/ UT GST Act will get attracted include:
i. reduction in tax rate;
ii. benefit of Input Tax Credit (ITC) available to the registered person/ supplier.
Q 6. What is the function of National Anti-Profiteering Authority (NAA)?
Ans. The National Anti-Profiteering Authority (NAA) is required to determine whether the benefit of input tax credit or reduction in the tax rate has actually resulted in a commensurate reduction in the price of the goods or services or both.
The NAA has the power to identify the registered person who h

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1800-114000/14404.
There are multiple ways through which aggrieved consumers or suppliers of goods and services can register their complaints against profiteering:
a. Online complaint facility:
Complainant can register an online complaint at http://www.naa.gov.in/complaint.php
Link to see the guidelines to register online complaint: http://www.naa.gov.in/page.php?id=guidelines-forconsumers
b. Via Mail:
User can mail the complaint at:
Agencies
Mail-Id
Nature of the complaint
Standing Committee 
sc.antiprofiteering@gov.in anti-profiteering@gov.in
Complaints involving issues of all-India nature.
State-Screening Committees 
For State-wise  E-mail Addresses please refer to: http://www.naa.gov.in/docs/screening%20committees%2020-08-18.xlsx
Complaints involving issues of local nature.
c. By Post:
Agencies
Postal Addresses
National Anti-profiteering Authority 
National Anti-profiteering Authority Dept. of Revenue, Ministry of Finance 6th Floor, Tower O

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ainst the registered person.
3. Thereafter, the Standing Committee shall refer the matter to the Director General of Anti-Profiteering (erstwhile DG, Safeguards) for a detailed investigation, if prima facie evidence of profiteering exists.
4. The DG, Anti-Profiteering shall conduct the investigation and submit its report to the National Anti-Profiteering Authority (NAA) constituted by the Central Government under section 171 (2) of the CGST Act, 2017 for taking appropriate action, as mentioned in the Answer to Q 6. above.
Q 10. How can one file complaint against profiteering?
Ans.  An online complaint can be filed  at http://www.naa.gov.in/complaint.php. Complaints of the nature of national-level can be filed by e-mail at sc.antiprofiteering@gov.in. Complaints of local nature can be sent by mail to the respective State Screening Committee.
Q 11. Whether one form is sufficient for multiple goods or services?
Ans. No, the prescribed application form APAF-01 is with refere

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ntation of GST?
Ans.  The Consumer Affairs Ministry in the Government of India, vide its letter no. WM-10(31)/2017, dated 04.07.2017, permitted the manufacturers or packers or importers of pre-packaged commodities to affix new MRP labels (after incorporating tax changes due to GST) in addition to existing MRP for three months from 1st Jul to 30th Sept 2017. Similar action was taken after the GST rate reduction in November, 2017 and July, 2018.
Q 14. What can buyers do if shopping malls and retail stores are still selling goods at pre-GST affixed labels?
Ans. As per the Government's directive, shopping malls and retail stores are required to affix two MRP labels reflecting both pre-GST & post-GST prices. Despite this, if consumers find that retailers are selling goods at pre-GST affixed labels, they can report to National Consumer Helpline. Also, the administrative machinery of the Controller of Legal Metrology can be effectively used by States/UTs to monitor & resolve such case

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rofiteering provisions in case benefit of transitional credit availed is not passed to the consumers?
Ans. The benefit of transitional input tax credit allowed under Section 140 (3) of the CGST Act, 2017, is required to be passed on to the recipient by way of reduced prices.
Q 17. What is the time-frame for deciding cases of anti-profiteering provisions?
Ans. The maximum time envisaged for resolution of cases is 9 months excluding the time taken by the State-level screening committee and the Standing Committee (maximum 2 months) for processing the complaints.
Q 18. What should a complainant ensure while submitting complaint to Screening Committee/ Standing Committee?
Ans. The complainant should submit a duly filled in application form APAF-01 along with his identification document and evidence of profiteering. The instructions for filling the said form are contained in form APAF-01.
Q 19. A company in order to justify the prices being charged by it may have to submit information

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Transitional Provisions
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
24. Transitional Provisions
Q 1. Will CENVAT credit (or VAT credit) carried forward in the last return prior to GST under existing law be available as ITC under GST?
Ans. A registered person, other than a person opting to pay tax under composition scheme, shall be entitled to take credit in his electronic credit ledger the amount of CENVAT (or VAT credit) credit carried forward in the return of the last period before the appointed day, subject to the conditions stated therein. (Section 140(1) of the CGST/SGST Act)
Q 2.  What are those conditions? Ans. The conditions are that: –
(i) the said amount of credit is admissible as input tax credit under this Act;
(ii) the registered person has furnished all the returns required under the existing law (i.e. Central Excise and VAT) for the period of six months  immediately  preceding  the appointed date;
(i

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2017-18. Though the invoice has been received within 30th June but the capital goods are received on 5th July, 2017 (i.e. in GST regime). Will such a person get full credit of CENVAT in GST regime?
Ans. Yes, he will be entitled to credit in 2017-18 provided such a credit was admissible as CENVAT credit in the existing law and is also admissible as credit in CGST – section 140(2) of the CGST Act.
Q 4. VAT credit was not available on items 'X' & 'Y' as capital goods in the existing law (Central Excise). Since they are covered in GST, can the registered taxable person claim it now?
Ans. He will be entitled to credit only when ITC on such goods are admissible under the existing law and is also admissible in GST. Since credit is not available under the existing law on such goods, the said person cannot claim it in GST – proviso to section 140(2) of the SGST Act.
Q 5. Assuming the registered person has wrongly enjoyed the credit (Refer to Q4) under the existing law, will

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in accordance with the provisions of section 140(3).
Q 8. A registered person has excess ITC of ₹ 10, 000/- in his last VAT return for the period immediately preceding the appointed day. Under GST he opts for composition scheme. Can he carry forward the aforesaid excess ITC to GST?
Ans. The registered person will not be able to carry forward the excess ITC of VAT to GST if he opts for composition scheme – Section 140(1).
Q 9. Sales return under CST (i.e. Central Sales Tax Act) is allowable as deduction from the turnover within six months? If, say, goods are returned in GST regime by a buyer within six months from appointed day, will it become taxable in GST?
Ans. Where tax has been paid under the existing law [CST, in this case] on any goods at the time of sale, not being earlier than six months prior to the appointed day, and such goods are returned by the buyer after the appointed day, the sales return will be considered as a supply of the said buyer in GST and tax has to b

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day (or within the extended period of maximum two months).
(iii) Both the manufacturer and the job worker declare the details of inputs held in stock by the job worker on the appointed day in the prescribed form.
The relevant sections are 141(1), 141(2) & 141 (4).
However, if the said inputs/semi- finished goods are not returned within six months (or within the extended period of maximum two months), the input tax credit availed is liable to be recovered.
Q 11. What happens if the job worker does not return the goods within the specified time?
Ans. Input tax credit availed by manufacturer will be payable by said manufacturer on the said goods if they are not returned to the place of business of the manufacturer within six months (or within the extended period of maximum two months) from the appointed day –
Q 12. Can a manufacturer transfer have finished goods sent for testing purpose to the premises of any other taxable person?
Ans. Yes, a manufacturer can transfer finished goo

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to the appointed day for carrying out tests or any process not amounting to manufacture under the existing law and if such goods are not returned to the manufacturer within six months (or within the extended period of maximum two months) from the appointed day, the input tax credit availed by the manufacturer will liable to be recovered if the aforesaid goods are not returned within six months from the appointed day. – Section 141(3)
Q 15. Is extension of two months as discussed in section 141 automatic?
Ans. No, it is not automatic. It may be extended by the Commissioner on sufficient cause being shown.
Q 16. What is the time limit for issue of debit/credit note(s) for revision of prices?
Ans. The taxable person may issue the debit/credit note(s) or a supplementary invoice within 30 days of the price revision.
In case where the price is revised downwards the taxable person will be allowed to reduce his tax liability only if the recipient of the invoice or credit note has reduced

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.
Q 19. If the appellate or revisional order goes in favour of the assessee, whether refund will be made in GST? What will happen if the decision goes against the assessee?
Ans. The refund will be made in accordance with the provisions of the existing law only. In case any recovery is to be made then, unless recovered under existing law, it will be recovered as an arrear of tax under GST – sections 142(6) & 142(7)
Q 20. How shall the refund arising from revision of return(s) furnished under the existing law be dealt in GST?
Ans. Any amount found to be refundable as a consequence of revision of any return under the existing law after the appointed day will be refunded in cash in accordance with the provisions of the existing law – section 142(9)(b).
Q 21. If any goods or services are supplied in GST, in pursuance of contract entered under existing law, which tax will be payable?
Ans. GST will be payable on such supplies- section 142(10) of the CGST Act.
Q 22. Tax on a particular

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GSTN and Frontend Business Process on GST Portal
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
23. GSTN and Frontend Business Process on GST Portal
Q 1. What is GSTN?
Ans. Goods and Services Tax Network (GSTN) is a not-for profit, non-government company under Section-8 of the Companies Act-2013, promoted jointly by the Central and State Governments, to provide shared IT infrastructure and services, to both central and state governments including tax payers and other stakeholders. The Front end services of Registration, Returns, Payments, etc. to all taxpayers will be provided by GSTN. It will be the interface between the government and the taxpayers. Further, GSTN also provides the Back-End Services to tax officers of the Model 2 states.
Considering the nature of function performed by GSTN, GST Council has taken a decision that GSTN be converted into a fully owned government Company. For this, the entire 51% equity holding held by the Non-

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d a robust settlement mechanism amongst the States and the Centre. Meeting these objectives were only possible only when there is a strong IT Infrastructure and Service back bone which would have enabled capturing, processing and exchange of information amongst the stakeholders (including taxpayers, States and Central Government, Bank and RBI). To achieve these objectives of establishing a uniform interface for the tax payer and a common and shared IT infrastructure between the Centre and States, the SPV namely GSTN was created.
Q 3. What is the genesis of GSTN?
The requirement of a strong IT Infrastructure was discussed in the 4th meeting of 2010 of the Empowered Committee of State Finance Ministers (referred to as the EC) held on 21/7/2010. In the said meeting, the EC approved the creation of an 'Empowered Group on IT Infrastructure for GST' (referred to as the EG) under the chairmanship of Dr. Nandan Nilekani with Additional Secretary (Rev), Member (B&C) CBIC, DG (Systems), CBIC,

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scuss the modalities. After due deliberations, the EG recommended creation of a Special Purpose Vehicle for implementing the GST System Project. To enable efficient and reliable provision of services in a demanding environment, the EG recommended a non- Government structure for the SPV called GSTN with Government equity of 49% (Centre – 24.5% and States – 24.5%) after considering key parameters such as independence of management, strategic control of Government(s), flexibility in its organizational structure, agility in decision making and ability to hire and retain competent human resources from both, government and private sector.
In view of the sensitivity of the role of GSTN and the information that would be available with it, the EG also considered the issue of strategic control of Government over GSTN. The Group recommended that strategic control of the Government over the SPV should be ensured through measures such as composition of the Board of Directors (also referred to as t

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ndations were presented before the Empowered Committee of State Finance Ministers in its 3rd meeting of 2011 held on 19th August 2011 and in the 4th meeting of 2011 of the EC held on 14th Oct 2011. The proposal of the EG on IT infrastructure for GST regarding GSTN and formation of a not-for-profit section 25 company with the strategic control of the Government were approved by the Empowered Committee of State Finance Ministers (EC) in its meeting held on 14.10.11.
The note of Department of Revenue for setting up a Special Purpose Vehicle to be called Goods and Services Tax Network (GSTN-SPV) on the lines mentioned above was considered by the Union Cabinet on 12th April 2012 and approved. The Union cabinet also approved the following:
i. Suitable and willing non-government institutions will be identified and firmed up by the Ministry of Finance to invest in GSTN-SPV prior to its incorporation.
ii. The strategic control of the Government over the SPV would be ensured through measures

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ivering integrated indirect Tax related services involving multiple tax authorities. Accordingly, any other service provider seeking to deliver similar integrated services would be required to enter into a formal arrangement with GSTN SPV for the services.
vii. A one- time non- recurring Grant- in aid of Rs. 315 crores from the Central Government towards functioning of the SPV for a three-year period after incorporation.
Considering the nature of function performed by GSTN, GST Council has taken a decision that GSTN be converted into a fully owned government Company. For this, the entire 51% equity holding held by the Non-Governmental Institutions in GSTN shall be acquired equally by the Centre and the States governments.
Q 4. What is the equity structure and Revenue Modelof GSTN?
Ans. (a) Equity Structure: – In compliance of the Cabinet decision, GST Network was registered as a not-for-profit, non-Government, private limited company under section 8 of the Companies Act, 1956 with

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o the Center and States through GST portal and developing the backend for 27 States and Union Territories. The Revenue model for GSTN has been approved by the Empowered Committee of State Finance Ministers under which user charges will be paid by the Centre and States/UTs equally on behalf of taxpayers and other stakeholders for availing services from the GST Portal. The user charges will be shared equally by the Centre and the States. The user charges for States will be apportioned amongst them based on number of registered taxpayers.
Q 5. What services are being rendered by GSTN?
Ans. GSTN renders the following services through the Common GST Portal:
(a) Registration (including existing taxpayer migration);
(b) Payment management including payment Gateways and integration with banking systems;
(c) Return filing and processing;
(d) Taxpayer management, including account management, notifications, information, and status tracking;
(e) Tax authority account and ledger Management;

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d by the tax authorities of States and Central governments.
Thus, it was decided that the Front-End (GST Portal services) shall be provided by GSTN and the Back-End modules shall be developed by states and Central Government themselves. However, 27 states (termed as Model-2 states) asked GSTN to develop their Back-End interface also. The CBIC and 9 states (Model 1) decided to develop and host the Back-End modules themselves. For Model 1 states/ CBIC full data (registration, return, payment etc.) submitted by taxpayers is being shared with them for information and analysis as deemed fit by them.
Q 7. What is the role of GSTN in registration?
Ans. The application for Registration is made Online on GST Portal. Some of the key data like PAN, Business Constitution, Aadhaar, CIN/DIN etc. (as applicable) is validated by the GST Portal online with the respective agency i.e. CBDT, UID, MCA etc., thereby ensuring minimum need for submission of documentation. The application data along with su

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ister of buyer, GST Returns filing on stipulated dates for each type of return (GSTR [1, 2, 3, 5, 9.etc];
iii. Tax payment by creation of Challan and integration with agency Banks;
iv. ITC and Cash Ledger and Liability Register;
v. MIS reporting for tax payers, tax officials and other stakeholders;
vi. BI/Analytics for Tax officials.
Q 10. What is the concept of GST Eco-system?
Ans. A common GST system will provide linkage to all State/UT Commercial Tax departments, Central Tax authorities, Taxpayers, Banks and other stakeholders. The eco-system consists of all stakeholders starting from taxpayer to tax professional to tax officials to GST portal to Banks to accounting authorities. The diagram given below depicts the whole GST eco-system.
Q 11. What is GSP (GST Suvidha Provider)?
Ans. GST System will provide a GST portal for taxpayers to access the GST System and do all the GST compliance activities. But there will be wide variety of tax payers (SME, Large Enterprise, Micro Ent

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hese service providers have been given a generic name, GST Suvidha Providers or GSP.
Q 12. What is the role of GST Suvidha Providers (GSP)?
Ans. GSP develops applications having features like return filing, reconciliation of purchase register data with auto populated data for acceptance/rejection/Modification, dashboards for taxpayers for quick monitoring of GST compliance activities. They may also provide role based access to divide various GST related activities like uploading invoice, filing returns etc., among different set of users inside a company (medium or large companies will need it), Applications for Tax Professional to manage their client's GST compliance activities, Integration of existing accounting packages/ERP with GST System, etc.
Q 13. What are the benefits to taxpayers in using the GSPs?
Ans. At the outset it is clarified that all required functions under GST can be performed by a taxpayer at the GST portal. GSP is an additional channel being made available for f

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one screen,
5. GST professionals will need some specific applications to manage and undertake GST compliance activities for their client Tax payers from one dashboard, etc.
Above are just a few illustrations. There will be many more requirements of different sets of Tax payers. These requirements of taxpayers can be met by GSPs.
Q 14. What are the functions which a taxpayer performs at the GST Common Portal being developed and maintained by GSTN for the taxpayers?
Ans. GST Common Portal is envisaged as one-stopshop for all requirements under GST for the taxpayers. Illustrative list of functions that can be performed by taxpayers through GST Portal managed by GSTN are:
* Application for registration as well as amendment in registration, cancellation of registration and profile management;
* Payment of taxes, including penalties, fines, interest, etc. (in terms of creation of Challan as payment will take place at bank's portal or inside a bank premises);
* Change of status of

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ny time basis. Early upload of invoices by supplier taxpayer will help receiver taxpayer in early reconciliation of data in Invoices as well as help supplier taxpayer in avoiding last minute rush of uploading returns on the last day.
Q 17. Does GSTN provide tools for uploading invoice data on GST portal?
Ans. Yes, GSTN has provided spreadsheet like tools (such as Microsoft Excel), Offline Utilities, free of cost, to taxpayers to enable them to compile invoice data in the same and generate files which can then be uploaded on GST portal. This are offline tools which can be used to input/capture invoice data without being online and then generate final files in compatible format for uploading to GST portal. These can be accessed at Download section of GST Portal.
Q 18. Does GSTN be provide mobile based Apps to view ledgers and other accounts?
Ans. The GST portal is being designed in such a way that it can be seen on any smart phone. Thus ledgers like cash ledger, liability ledger, ITC

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ave videos embedded into them, for each process to be performed on the GST portal. These have been put on the GST portal as well as on the website of all tax authorities. Apart from CBT's, Various User Manuals, FAQ's etc., have also be placed on GST Portal for education of the taxpayers. Apart from it, an interactive Self-Help Grievance Redressal Portal has been set up for the taxpayers for logging of their tickets
(https://selfservice.gstsystem.in/) or phone (01244688999). CBT, FAQ and User Manuals for enrolment process are readily available at https://www.gst.gov.in/help.
GSTN conducts webinars on various topics related to GST Portal and same can be seen in GSTN you tube channel (https://www.youtube.com/c/GoodsandServicesTaxNetwork).
Apart from sending bulk mails to the taxpayers regarding new functionalities and advisories, GSTN connects with the taxpayers and other stakeholders through its social media channel i.e facebook https://www.facebook.com/gstsystemsindia/ and twitter ha

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detection, data encryption at rest as well as in motion, complete audit trail, tamper proofing using consistent hashing algorithms, OS and host hardening etc. has been done. GSTN has also established a primary and secondary Security Operations Command & Control center, which proactively monitors and protect malicious attack on a real-time basis. GSTN is also ensuring secure coding practices through continuous scanning of source code & libraries being used in GST system to protect against commonly known and unknown threats.
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Document 1
ποιοι
Tax payers
Facility Center
Reps
Tax Return
Preparers
Assist Tax payers in
return preparation
Self-register, Upload
details, file returns,
make online payment,
apply for refund etc
Taxpayer
Registration/
Return Processing/
Payment Collection/
Any other support
Help services
related to GST
System
State Tax
Authorities
Approval for
enrolment of tax
payers/Tax
administration
Approval for
enrolment

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Place of Supply of Services (Location of supplier or recipient is outside India)
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
22.3 Place of Supply of Services (Location of supplier or recipient is outside India)
Q 30. What is the place of supply in respect of goods that are required to be made physically available for providing the service?
Ans. The place of supply of service in respect of goods that are required to be made physically available by the recipient of service to the supplier of service shall be the location where the services are actually performed. (Section 13 (3) (a) of the IGST Act, 2017)
Q 31. What is the place of supply of services provided from a remote location using electronic means on goods?
Ans. The place of supply shall be the location where the goods are actually located at the time of supply of services. (Proviso to Section 13(3) (a) of the IGST Act, 2017) Illustration: A Laptop at Mumbai is repaired remotely by

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Q 34. What is the place of supply of an intermediary?
Ans. The place of supply for intermediary services will be the location of supplier of service. It is to be noted that this rule will apply only when either the supplier or recipient is located outside India.
Q 35. What would be the place of supply in respect of services pertaining to goods transportation, wherein either the supplier or recipient is located outside India?
Ans. The place of supply of services of transportation of goods, other than by way of mail or courier, shall be the place of destination of such goods. (Section 13(9) of IGST Act)
For goods transportation via mail or courier, the default provision of Section 13(2) will apply i.e. place of supply will be the location of the recipient of service.
Q 36. What would be the place of supply in respect of Online Information and Database Access or Retrieval (OIDAR) Services?
Ans. For OIDAR services the place of supply will be the location of recipient of services. I

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maintained is in the taxable territory;
(f) the country code of the subscriber identity module card used by the recipient of services is of taxable territory;
(g) the location of the fixed land line through which the service is received by the recipient is in the taxable territory.
Q 37. Whether the launch service provided by ANTRIX Corporation qualifies to be considered as export of services?
Ans. In terms of Section 13(9) of IGST Act, 2017, the place of supply of satellite launch service by ANTRIX Corporation to international customers would be outside India and wherever such supply qualifies all conditions specified under Section 2(6) of the IGST Act, 2017, would constitute as export of service and shall be zero rated.
Where satellite service was provided to a person in India, the place of supply of satellite launch service would be location of the recipient of services, provided the recipient is registered. In case where the recipient is not registered then place of supply is

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treatment or process, the default rule would be applicable i.e. the place of supply shall be the location of recipient of services.
Thus, in such cases, the place of supply shall be the location of recipient of services (Default provision in section 13(2)) i.e. outside India.
Q 39. How will the place of supply be determined wherein the goods are supplied from the premises of job worker?
Ans. The principal may supply, from the place of business / premises of a job worker on payment of tax within India. The place of supply would have to be determined in the hands of the principal irrespective of the location of the job worker's place of business/premises.
Illustration: The principal is located in State A, the job worker in State B and the recipient in State C. In case the supply is made from the job worker's place of business / premises, the invoice will be issued by the supplier (principal) located in State A to the recipient located in State C. The said transaction will be an inter

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Place of Supply of Services (Location of supplier as well as recipient are in India)
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
22.2 Place of Supply of Services (Location of supplier as well as recipient are in India)
Q 13. What is the default presumption for place of supply in respect of B2B supply of services?
Ans. The terms used in the IGST Act are registered taxpayers and unregistered person. The presumption in case of supplies to registered person is the location of such person until and unless otherwise specified.
Q 14. What is the default presumption for place of supply in respect of unregistered recipients?
Ans. In respect of unregistered recipients, the usual place of supply is the location of the recipient, where the address on records exists. However, in many cases, the address of recipient is not available, in such cases, location of the supplier of services is taken as proxy for place of supply.
Q 15. What is the place of

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ere the immovable property is located in more than one State, the supply of service shall be treated as made in each of the States in proportion to the value for services separately collected or determined, in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other reasonable basis as may be prescribed in this behalf. (The Explanation clause to section 12(3) of the IGST Act, for domestic supplies)
Q 18. What is the place of supply of services of accommodation services in homestays in Goa?
Ans. The place of supply shall be Goa, the location of the home stay. (Section 12(3) of the IGST Act).
Q 19. What would be the place of supply of services provided for organizing an event, say, IPL cricket series which is held in multiple states?
Ans. In case of an event, if the recipient of service is registered, the place of supply of services for organizing the event shall be the location of such person.
However, if the rec

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12(8) has been inserted vide the IGST (Amendment) Act, 2018, however, the notification to bring it into effect is yet to be issued)
In case location of supplier or location of recipient is outside India: The place of supply of services of transportation of goods, other than by way of mail or courier, shall be the place of destination of such goods. For courier, the place of supply of services shall be the location of the recipient of services. Wherever the location of the recipient of services is not available in ordinary course of business, the Place of supply shall be location the supplier of service.
Q 21. A film star from Mumbai gets his cosmetic surgery done in a Hospital in Delhi. What should be the place of supply?
Ans. The place of supply shall be based on the principle of place of performance and shall be in Delhi. (Section 12(4) of IGST Act)
Other such similar services requiring physical presence of natural person (recipient) like restaurant and catering services, person

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.
However, for the return journey, the place of supply shall be Delhi as the return journey has to be treated as separate journey. (The Explanation clause to section 12(9) of the IGST Act)
Q 24. Suppose a ticket/ pass for anywhere travel in India is issued by M/s Air India to a person. What will be the place of supply?
Ans. In the above case, the place of embarkation will not be available at the time of issue of invoice as the right to passage is for future use. Accordingly, place of supply cannot be the place of embarkation. In such cases, the default rule shall apply. (The proviso clause to section 12(9) of the IGST Act)
Q 25. What will be the place of supply for mobile connection? Can it be the location of supplier?
Ans. For domestic supplies: The location of supplier of mobile services cannot be the place of supply as the mobile companies are providing services in multiple states and many of these services are inter-state. The consumption principle will be broken if the locati

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services. So Goa shall be the place of supply.
Q 27. A person from Mumbai goes to Kullu-Manali and takes some services from ICICI Bank in Manali. What will be the place of supply?
Ans. If the service is not linked to the account of person, place of supply shall be Kullu i.e. the location of the supplier of services. However, if the service is linked to the account of the person, the place of supply shall be Mumbai, the location of recipient on the records of the supplier.
Q 28. A person from Gurgaon travels by Air India flight from Mumbai to Delhi and gets his travel insurance done separately in Mumbai. What will be the place of supply of insurance service?
Ans. The location of the recipient of services on the records of the supplier of insurance services shall be the place of supply. So Gurgaon shall be the place of supply. (Proviso clause to section 12(13) of the IGST Act)
Q 29. A person from Gurgaon travels by Air India flight from Mumbai to Delhi and gets his travel insurance

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Place of Supply of Goods
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
22.1 Place of Supply of Goods
Q 5. What would be the place of supply where movement of goods is involved?
Ans. The place of supply of goods shall be the location of the goods at the time at which the movement of goods terminates for delivery to the recipient. (Section 10 of IGST Act)
Q 6. What would be the place of supply wherein the supplier hands over the goods to recipient in his state and further movement is caused by the recipient?
Ans. The movement can be caused by supplier, recipient or any other person. Where the supply involves movement of goods, the place of supply shall be the location where the movement of goods

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pply is Delhi, the location of goods at the time of delivery.
Q 8. What will be the place of supply if the goods are delivered by the supplier to a person on the direction of a third person?
Ans. It would be deemed that the third person has received the goods and the place of supply of such goods shall be the principal place of business of such person. (Section 10 of IGST Act)
Such cases are termed as bill to ship to cases wherein the supplier sends the invoice to the buyer and the goods to the recipient on the direction of the buyer. Even though the goods are not received by the buyer, it is presumed that he has received the goods and he is able to take the input tax credit. The buyer may further issue his invoice to the actual recipien

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e taken on board at Vadodara, Gujarat on Rajdhani Express from Mumbai to Delhi. The place of supply shall be Vadodara, Gujarat.
However, in respect of services, the place of supply shall be the location of the first scheduled point of departure of that conveyance for the journey. (Section 12 and 13 of IGST Act)
Q 10. What is the place of supply in case of assembly or installation of goods at site?
Ans. The place of supply of goods, where the goods are installed or assembled at the site, will be the place of such installation or assembly. (Section 10(1)(d) of IGST Act)
Q 11. What is the place of supply of goods imported into India?
Ans. The place of supply of goods imported into India shall be the location of the importer.
Illustration

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Place of Supply of Goods and Service
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
22. Place of Supply of Goods and Service
Q 1. What is the need for the Place of Supply of Goods and Services under GST?
Ans. The basic principle of GST is that it should effectively tax the consumption of such supplies at the destination thereof or as the case may at the point of consumption. So place of supply provision determines the place i.e. taxable jurisdiction where the tax should reach. The place of supply determines whether a transaction is intra-state or interstate. In other words, the place of Supply of Goods or services is required to determine whether a supply is subject to SGST plus CGST in a given S

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ow the customer could avail service from anywhere;
(ii) Service provider, service receiver and the service provided may not be ascertainable or may easily be suppressed as nothing tangible moves and there would hardly be a trail;
(iii) For supplying a service, a fixed location of service provider is not mandatory and even the service recipient may receive service while on the move. The location of billing could be changed overnight;
(iv) Sometime the same element may flow to more than one location, for example, construction or other services in respect of a railway line, a national highway or a bridge on a river which originate in one state and end in the other state. Similarly, a copy right for distribution and exhibition of film could

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roxies or assumptions in a transaction can be used to determine the place of supply?
Ans. The various element involved in a transaction in services can be used as proxies to determine the place of supply. An assumption or proxy which gives more appropriate result than others for determining the place of supply, could be used for determining the place of supply. The same are discussed below:
(a) location of service provider;
(b) the location of service receiver;
(c) the place where the activity takes place/ place of performance;
(d) the place where it is consumed; and
(e) the place/person to which actual benefit flows
Q 4. What is the need to have separate rules for place of supply in respect of B2B (supplies to registered persons) an

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Imports
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
21.6 Imports
Q 65. How will imports be taxed under GST?
Ans. Import of Goods and Services are treated as deemed inter-state supplies and IGST is levied on import of goods and services in to the country. The IGST on import of goods is leviable under the provisions of Section 5 of the IGST Act, 2017 read with Section 3(5) of the Customs Tariff Act, 1975 and shall be levied at the time of imports along with the levy of the applicable Customs duties on the value in accordance with Section 3 of the Customs Tariff Act, 1975.
Q 66. What is import of goods under the GST regime? How are they taxed?
Ans. The import of goods has been defined in sub-section (10) of Section 2 of the IGST Act, 2017 as bringing goods into India from a place outside India.
The IGST Act, 2017 provides that the integrated tax on goods shall be in addition to the applicable Basic Customs Duty (BCD) which is levied as pe

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Value for Integrated Tax 
Rs.111/-
(E) Integrated Tax @18% 
Rs.19.98
(F) Value for Compensation Cess 
Rs.111
(G) Compensation Cess @ 15% 
₹ 16.65
(H) Total Duty ( B+C +E+G) 
₹ 47.63
Q 68. Whether Anti-dumping duty/ safeguard duty are to be added for determining the value for integrated tax?
Ans. Yes. In cases where imported goods are liable to Anti-Dumping Duty or Safeguard Duty, value for calculation of IGST as well as Compensation Cess shall also include Anti-Dumping Duty amount and Safeguard duty amount. Let's say in the above case if Safeguard duty is ₹ 20/-, the assessable value for integrated tax as well as compensation cess shall be ₹ 131/-. The taxes calculation chart is as under:
Particulars
Duty
(A) Assessable Value 
₹ 100/-
(B) Basic Customs Duty@10% 
Rs.10/-
(C) Social Welfare Charge @10% 
Rs.1/-
(D) Safeguard Duty 
Rs.20/-
(E) Value for Integrated Tax 
Rs.131/-
(F) Integ

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customs station to a warehouse.
The “transfer/sale of goods while being deposited in a customs bonded warehouse” is a common trade practice whereby the importer files an into-bond bill of entry and stores the goods in a customs bonded warehouse and thereafter, supplies such goods to another person who then files an ex-bond bill of entry for clearing the said goods from the customs bonded warehouse for home consumption.
As per section 7(2) of the IGST Act, 2017, the supply of goods imported into the territory of India, till they cross the customs frontiers of India, is treated as a supply of goods in the course of inter-State trade or commerce. Further, the proviso to section 5(1) of the IGST Act provides that the integrated tax on goods imported into India would be levied and collected in accordance with the provisions of section 3 of the Customs Tariff Act, 1975. Thus, in case of supply of the warehoused goods, the point of levy would be the point at which the duty is collected unde

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on. In other words, the supply of goods before their clearance from the warehouse would not be subject to the levy of integrated tax and the same would be levied and collected only when the warehoused goods are cleared for home consumption from the customs bonded warehouse.
Q 71. Whether high seas sales treated as supply in GST?
Ans. 'High Sea Sales' is a common trade practice whereby the original importer sells the goods to a third person before the goods are entered for customs clearance. After the High sea sale of the goods, the Customs declarations i.e. Bill of Entry etc. is filed by the person who buys the goods from the original importer during the said sale. IGST on high sea sale (s) transactions of imported goods, whether one or multiple, shall be levied and collected only at the time of importation i.e. when the import declarations are filed before the Customs authorities for the customs clearance purposes for the first time. Further, value addition accruing in each

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m IGST is only available till 01.10.2019.
Q 73. What are import of services? How are they treated in GST?
Ans. Import of services has specifically been defined under IGST Act, 2017 and refers to supply of any service where the supplier is located outside India, the recipient is located in India and the place of supply of service is in India.
As per the provisions contained in Section 7(1) (b) of the CGST Act, 2017, import of services for a consideration whether or not in the course or furtherance of business shall be considered as a supply. Thus, in general, import of services without consideration shall not be considered as supply. However, business test is not required to be fulfilled for import of service to be considered as supply.
Furthermore, in view of the provisions contained in Schedule I of the CGST Act, 2017, the import of services by a taxable person from a related person or from a distinct person as defined in Section 25 of the CGST Act, 2017, in the course or furthera

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person or from a distinct person 
Not required Necessarily Required
 
Q 74. As per the Customs Act, 1962, royalty and license fees are includible in the assessable value of goods. Whether GST is also payable on such royalty and license fees which is already included in the value of goods and IGST is already paid at the time of import?
Ans. No. As per the notification no. 06/2018-Integrated tax dated 25th January, 2018, supply of services, imported into the territory of India covered by such temporary transfer or permitting the use or enjoyment of any intellectual property right are exempted from payment of integrated tax to the extent that royalties and license fees have been included in the transaction value as specified under rule 10(1)(c) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 on which the appropriate duties of Customs have been paid.
Q 75. What procedure will be followed by EOU to import goods without payment of Customs duty i

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ted from payment of integrated tax at the time of import subject to the importer undertaking to pay integrated tax on lease charges and other conditions as stipulated in notification no. 65/2017-Customs dated 8th July, 2018
Q 78. Whether import of rigs and ancillary goods imported under lease is chargeable to IGST?
Ans. Import of rigs and ancillary goods imported under lease is exempted from IGST, subject to payment of appropriate IGST on the supply/import of such lease service and fulfilment of other specified conditions.
Q 79. Whether bona fide gifts imported through post or air are exempted?
Ans. Bona fide gifts up to CIF value limit of ₹ 5000 imported through post or air are exempted from payment of basic customs duty and integrated tax.
Q 80. How are supplies by SEZs to DTA treated in GST?
Ans. Supplies by SEZs to DTA units are liable to GST. Supplies from SEZs to DTA can be categorised as under:
Supply under Bill of Entry: The supplies made by SEZ on cover of a bill

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Special Economic Zone (SEZ)
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
21.4 Special Economic Zone (SEZ)
Q 38. How are supplies by and to SEZs treated in GST?
Ans. There is no change in the SEZ scheme. All imports by SEZs are exempted from any duty/tax.
As per section 7(5)(b) of the IGST Act, 2017, a supply of goods or services or both to or by a SEZ developer or a SEZ unit is treated to be a supply of goods or services or both in the course of inter-State trade or commerce.
Further as per section 16 of IGST Act, 2017 supply of goods or services or both to a SEZ developer or a SEZ unit is considered as zero rated supply.
Q 39. What will be the IGST rates when goods or services or both are supplied to SEZ unit?
Ans. Supplies to SEZ unit or developer are considered as zero rated. As such, the supplier can choose to either supply on payment of IGST and claim refund or supply without payment of IGST and in that scenario can only claim the

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ommodation, conferencing, banqueting etc., provided to a SEZ developer or a SEZ unit shall be treated as an inter-State supply.
Q 41. Whether SEZ unit or developer needs to pay IGST when it received supplies which are under reverse charge mechanism?
Ans. All supplies to SEZs are zero rated. However, the suppliers are given two options. In this case, the supplier is not liable to pay GST as the supply is under reverse charge mechanism. The recipient is considered as deemed supplier.
Therefore, SEZ has to pay GST in this case.
Q 42. What is the refund mechanism when a DTA supplier supplies goods/services to SEZ Unit?
Ans. The supplier to SEZs has following two options:
(i) Supply goods or services or both to SEZ unit or developer on payment of Integrated tax and claim refund
(ii) Supply goods or services or both to SEZ unit or developer without payment of Integrated tax under LUT/Bond and claim refund of unutilized ITC
Option I: Supply goods or services or both to SEZ unit or dev

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e of invoices, the evidence regarding the endorsement specified in the second proviso to sub-rule (1) and the details of payment, along with the proof thereof, made by the recipient to the supplier for authorised operations as defined under the Special Economic Zone Act, 2005, in a case where the refund is on account of supply of services made to a Special Economic Zone unit or a Special Economic Zone developer;
(iii) a declaration to the effect that the Special Economic Zone unit or the Special Economic Zone developer has not availed the input tax credit of the tax paid by the supplier of goods or services or both, in a case where the refund is on account of supply of goods or services made to a Special Economic Zone unit or a Special Economic Zone developer;
(Section 89(1) of CGST (Rules), 2017.)
Option II: Supply goods or services or both to SEZ unit or developer without payment of Integrated tax under LUT/Bond and claim refund of unutilized ITC
The supplier has to follow the p

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of the Integrated Tax Act, 2017.
Q 44. Whether the Bond/LUT by a DTA supplier should be submitted to the Development Commissioner SEZ or the jurisdictional proper officer of GST?
Ans. As per Circular No.2/2/2017-GST dated 04.07.2017 Bond/LUT shall be furnished to the jurisdictional Deputy/Assistant Commissioner having jurisdiction over the principal place of business of the exporter.
Q 45. What are the requirement for submitting Bond/LUT?
Ans. The requirement of Bond/LUT will be as prescribed under Circulars No. 4, 8 and 40/2017.
The registered person (exporters) shall fill and submit FORM GST RFD-11 on the common portal. An LUT shall be deemed to be accepted as soon as an acknowledgement for the same, bearing the Application Reference Number (ARN), is generated online. No document needs to be physically submitted to the jurisdictional office for acceptance of LUT.
If it is discovered that an exporter whose LUT has been so accepted, was ineligible to furnish an LUT in place of bo

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rocessing area of SEZ will be eligible for exemption granted to SEZs?
Ans.  No. Bank as a nominated agency in the non-processing area of SEZ will not be eligible for exemption granted to SEZ.
Q 49. Whether the exemption granted to nominated agency pre GST regime will continue in the post GST regime for importing gold?
Ans. The bank as a nominated agency will continue to get the exemption of Customs duty as prevailed before the GST regime vide Notification No. 57/2000-Cus dated 08.05.2000.
Import of gold by specified banks and specified PSUs as mentioned in Notification No. 77/2017-Cus dated 13.10.2017 attracts Nil IGST. However, other banks will have to pay the IGST as per the Notification No. 26/2017-Cus dated 28.06.2017 as no exemption has been granted for payment of IGST duty to these.
Q 50. Can bank recover the IGST rate from the SEZ Unit while supplying gold to the SEZ Unit?
Ans. No. The banks cannot recover IGST rate from the SEZ Unit. However, the Banks can claim the

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tion, conferencing, banqueting etc., provided to a SEZ developer or a SEZ unit shall be treated as an inter-State supply.
(CBIC Circular No. 48/22/2018- GST dated 14th June, 2018)
Q 52. Whether the benefit of zero rated supply can be allowed to all procurements by a SEZ developer or a SEZ unit such as event management services, hotel and accommodation services, consumables etc?
Ans. Subject to the provisions of section 17(5) of the CGST Act, if event management services, hotel, accommodation services, consumables etc. are received by a SEZ developer or a SEZ unit for authorised operations, as endorsed by the specified officer of the Zone, the benefit of zero rated supply shall be available in such cases to the supplier.
(CBIC Circular No. 48/22/2018- GST dated 14th June, 2018)
Q 53. Whether a company having a unit in SEZ and a unit in DTA require separate registration for both the units?
Ans. Yes, as per Section 8(1) of CGST (Registration) Rules, 2017 a person having a units(s) i

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te supplies under the IGST Act. Under the GST Law, any supplier making inter-State supplies has to compulsorily get registered under GST. Thus anyone making a supply to a SEZ unit or SEZ developer has to necessarily obtain GST registration.
Q 55. Whether SEZ Act/Rules are aligned with the GST?
Ans. SEZ Rules, 2006 have been synced with the GST Provisions vide SEZ (Amendment) Rules, 2018. The terms like Service Tax, Stamp Duty etc replaced with CGST/SGST/IGST/UTGST etc. GST registration certificate required instead of Sales tax registration earlier for establishment / setting up of SEZ unit(s)
Q 56. Whether duty drawback is admissible on supplies by DTA units to SEZs?
Ans. Yes. Supplies made by DTA unit to SEZ Unit or developer are eligible for drawback in cases where the SEZ Unit or developer issues a disclaimer to the DTA supplier and drawback is claimed by the DTA supplier.
Drawback shall be processed and paid by the office of Principal Commissioner or Commissioner of Customs/ C

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Export Oriented Units
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
21.5 Export Oriented Units
Q 57. Whether the exemption granted to EOUs pre-GST regime will continue in the post GST regime?
Ans. Imports by EOUs: The EOUs will continue to get the exemption of Customs duty as prevailed before the GST regime vide Notification No. 52/2003-Cus dated 31.03.2003.
The imports by EOUs are to be levied IGST and compensation cess as per the Notification No. 59/2017-Cus dated 30.06.2017. However, as part of export package, imports by EOUs have been temporarily exempted from payment of IGST and compensation cess up to 31st March, 2019 vide Customs Notification No. 65/2018-Customs dated 24.09.2018.
Supply

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l as to the Customs Officer at port of import. On the basis of the declaration by EOU, Customs Officer at port will allow the clearance of goods giving benefit of exemption Notification No. 52/2003-Cus dated 31.03.2003. There is no requirement of separate continuity bond to be submitted by EOU as per the requirement under Customs (Import of goods at Concessional Rate of Duty) Rules, 2017 as B-17 bond, being a general purpose bond will serve the said purpose.
The inter unit transfer would be on invoice on payment of applicable GST taxes. However, such transfer would be without payment of custom duty. The supplier unit will endorse on such documents the amount of custom duty, availed as exemption, if any, on the goods intended to be transfer

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(ITC) on account of exports made under bond/LUT. As per section 54 of CGST Act, 2017, a refund application may be filed within two years from the relevant date by EOUs. The application in form RFD-01A has to accompanied with the documents as prescribed under Rule 89 of CGST Rules, 2017 for claiming refund of ITC. Refund of IGST on exports is available as per Rule 96 of CGST Rules and shipping bill filed is deemed to be application filed for refund. 90% of the total amount claimed as refund will be granted within 10 days of making application or within 7 days of issuance of acknowledgement of refund application. Balance amount of 10% will be granted after verification of documents furnished by the applicant.
Q 61. Will supply of goods from

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Duty Drawback Scheme
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
21.3 Duty Drawback Scheme
Q 35. Is there any impact of GST on the Duty Drawback Scheme for exporters?
Ans. Following changes have been done in the Duty Drawback scheme in Customs:
(i) No amendments have been made to the drawback provisions (Section 74 or Section 75) under Customs Act 1962 in the GST regime.
(ii) However, the duty drawback rules have substantially been amended and new Customs and Central Excise Duties Drawback Rules, 2017 with effect from 01.10.2017, have been issued. (Notification No. 88/2017-Customs (N.T) dated 21st September, 2017)
(iii) The definition of drawback has been amended to exclude Integrated Tax a

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s Brand Rate under Section 75 shall also continue.
(viii) Drawback under Section 74 will refund Customs duties as well as Integrated Tax and Compensation Cess paid on imported goods which are re-exported. However, a part of the Integrated Tax and Compensation Cess paid on imported goods would have gone to the respective States/UT, therefore, the same can only be refunded only if the concerned State/UT has not refunded it and the importer has not taken ITC of the same.
Q 36. Will drawback at higher rate be available to exporters who do not avail Input Tax Credit (ITC) like presently available to those who do not avail CENVAT credit?
Ans. Prior to GST, there were two All Industry Rates (AIRs) of duty drawback on exports. The higher rate re

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s paid on imported materials used in the manufacture of export goods.
However, as an export facilitation measure, for the transition period of 3 months from July to September, 2017, drawback at higher composite rates were continued to be granted subject to the condition that no input tax credit of CGST/IGST was claimed, no refund of IGST paid on export goods was claimed and no CENVAT credit was carried forward.
Q 37. Do state taxes also are refunded through duty drawback scheme?
Ans. No. The central taxes which are outside GST but are embedded in exports namely Customs, Central Excise are refunded under the Duty Drawback Scheme. The State taxes are only refunded in respect of apparel and clothing under the Refund of State Levies (RoSL) s

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Export of Services
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
21.2 Export of Services
Q 30. What is supply of services in the GST?
Ans. As in the earlier service tax regime, five conditions have been prescribed for a service to be treated as exports in GST. The five conditions comprised in the definition of the term “Export of Services” are cumulative and are to be fulfilled in totality in order to consider a transaction of supply of service as an export supply. They are as under:
(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India; and
(v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accor

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e of business” is defined in section 2(85) of the CGST Act, 2017 and includes
(a) a place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place where a taxable person stores his goods, supplies or receives goods or services or both; or
(b) a place where a taxable person maintains his books of account; or
(c) a place where a taxable person is engaged in business through an agent, by whatever name called;
A fixed establishment is defined in section 2(50) of the CGST Act, 2017 and “means a place (other than the registered place of business) which is characterised by a sufficient degree of permanence and suitable structure in terms of human and technical resources to supply services, or to receive and use services for its own needs.
Q 32. How is condition 5 viz the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8 of the IGST Act, 2017 impac

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ated 28.06.2017 as amended by Notification 42/2017-Integrated Tax (Rate) dated 27.10.2017.
Further, requirement of remittance in foreign exchange has been relaxed by amendment in the definition of “export of services” in section 2(6) of the IGST Act, 2017 vide the IGST (Amendment) Act, 2018. The payment for such service can now be received by the supplier of service in Indian rupees wherever permitted by the Reserve Bank of India.
Q 34. Whether services supplied by an establishment of a person in India to any establishment of that person outside India, which are treated as establishments of distinct persons in accordance with Explanation 1 in section 8 of the Integrated Goods and Services Tax Act, 2017 taxable?
Ans. No. Such services are exempted with a condition that the place of supply should be outside India as per section 13 of the IGST Act, 2017 (Notification No. 15/2018-Integrated Tax (Rate) dated 26th July, 2018)
Manuals, Ready reckoner, Law and practice, Reference Guide,

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Exports and Imports
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
21. Exports and Imports
21.1 Exports
Q 1.  How are exports be treated under GST?
Ans. All exports are deemed as inter-State supplies. Exports of goods and services are treated as zero rated supplies. The exporter has the option either to export under bond/Letter of Undertaking without payment of tax and claim refund of ITC or pay IGST by utilizing ITC or in cash at the time of export and claim refund of IGST paid.
Q 2.  What is Zero Rating?
Ans. By zero rating it is meant that the entire value chain of the supply is exempt from tax. This means that in case of zero rating, not only is the output exempt from payment of tax, there is no bar on taking/availing credit of taxes paid on the input side for making/providing the output supply. The concept of zero rating of supplies requires the supplies as well as the inputs or input services used in supplying the supplies

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tax on the outward exempted supplies, however, the input supplies used for making exempt supplies to be taxed 
No tax on the outward supplies; Input supplies also to be tax free
Credit of input tax needs to be reversed, if taken; No ITC on the exempted supplies
Credit of input tax may be availed for making zero-rated supplies, even if such supply is an exempt supply ITC allowed on zero-rated supplies
Value of exempt supplies, for apportionment of ITC, shall include supplies on which the recipient is liable to pay tax on reverse charge basis, transactions in securities, sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building.
Value of zero rated supplies shall be added along with the taxable supplies for apportionment of ITC
Any person engaged exclusively in the business of supplying goods or services or both that are not liable to tax or wholly exempt from tax under the CGST or IGST Act shall not be liable to registration 
A person excl

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GSTIN (wherever registered with GST) at the time of import/export of goods. The PAN level aggregation of data would automatically happen in the system. The IEC holders shall quote their PAN number (instead of IEC) in all their future correspondence as well as documentation with DGFT.
Q 6. What IEC number is to be used for special category of importers like government, individual importing for personal use etc in terms of para 2.07(b) of Handbook of Procedure by DGFT?
Ans. DGFT has modified the para 2.07(b) and has allotted revised permanent IEC number for such category of importers vide DGFT Public Notice No. 09/2015-20 dated 29th June, 2017. The same can be used for import /export by the categories of importers/exporters mentioned therein.
For instance, persons /Institutions /Hospitals importing or exporting goods for personal use, not connected with trade or manufacture or agriculture, earlier using IEC no. 0100000053 now have to use IIHIE0153E as IEC.
Q 7.  What is export o

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rritory of India shall comprise
(a) The territories of the states
(b) The Union Territories specified in the First Schedule
(c) Such other territories as may be acquired
Article 1 of the Constitution makes it clear that the territories of the States and that of the Union Territories are fixed in terms of First Schedule to the Constitution. India is a Union of States however the territory of India is not limited to the territories of the respective States but also includes other territories as may be acquired.
The Maritime Zone Act vide section 3(1) thereof provides that the sovereignty of India extends to territorial waters, sea bed and subsoil underlying such waters and the air space over such waters. The limit of territorial waters is fixed at 12 nautical miles from the baseline as per Section 3(2) of the Maritime Zone Act.
The continental shelf of India comprises the seabed and subsoil of the submarine areas that extend beyond the limit of its territorial waters throughout

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tate of Karnataka and Ors. on 23 January, 2004 = 2004 (1) TMI 649 – KARNATAKA HIGH COURT before Karnataka High Court, the Court held that State of Karnataka had taxation powers over territorial waters. The matter was appealed against before the Supreme Court and the Supreme Court in Civil Appeal No. 3383/2004 has stayed the order of the High Court. The Hon'ble Supreme Court on 13.1.2016 =  2016 (1) TMI 1395 – SUPREME COURT OF INDIA while hearing this case had observed as follows:
“any pronouncement of the court would have far reaching implications not only for central state relationship but the federal character and separation of legislative powers of the union and the States”.
The GST Council in its ninth meeting held on 16th January, 2017 took the decision that the territorial water within the twelve nautical miles shall be treated as the territory of the Union of India unless the Hon'ble Supreme Court decides otherwise in the on-going litigation on the issue but the power

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nt of tax on furnishing of a declaration form?
Ans. No, there is no such provision in GST. Tax has to be payable on their inward supplies and they can claim refund of the accumulated ITC.
However, there is a 0.1% scheme in which a supplier can supply goods to an exporter by paying only 0.1% GST and claim refund of unutilised ITC. The exporter in such a scenario cannot export on payment of integrated tax and take refund. He has to adopt the LUT/Bond route only.
Q 11. What is the 0.1% scheme for procurement of exports by merchant exporters?
Ans. It is a scheme for merchant exporters who have an option to pay nominal GST of 0.1% for procuring goods from domestic suppliers for export vide Notification 40/2017-Central Tax (Rate) and 41/2017-Integrated Tax (Rate) both dated 23.10.2017.
Exemption from payment of GST on so much of the tax leviable on such goods as is in excess of the amount calculated @0.1%, is granted, subject to fulfilment of following conditions:
* Supply on a tax in

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ms Station from where the said goods are to be exported;
* if the registered recipient intends to aggregate supplies from multiple registered suppliers and then export, the goods from each registered supplier shall move to a registered warehouse and after aggregation, the registered recipient shall move goods to the Port, Inland Container Deport, Airport or Land Customs Station from where they shall be exported;
* in case of situation referred to in above condition, the registered recipient shall endorse receipt of goods on the tax invoice and also obtain acknowledgement of receipt of goods in the registered warehouse from the warehouse operator and the endorsed tax invoice and the acknowledgment of the warehouse operator shall be provided to the registered supplier as well as to the jurisdictional tax officer of such supplier; and
* when goods have been exported, the registered recipient shall provide copy of shipping bill or bill of export containing details of Goods and Servic

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he goods exported out of India are subjected to export duty; or
* ii) the exporter claims drawback of CGST or refund of IGST paid on such export.
Q 14. Will the principle of unjust enrichment apply to exports?
Ans.  The principle of unjust enrichment is not applicable in case of exports of goods or services as the recipient is located outside the taxable territory.
However, in respect of supplies to SEZs, section 54(8) has been amended vide CGST (Amendment) Act, 2018 so as to make the principle of unjust enrichment applicable. Thus, from the date of coming of the CGST(Amendment) Act, 2018 into force, the principle of unjust enrichment will be applicable in in case of refunds against supplies to SEZs, even though such supplies are zero rated.
Q 15. What is deemed export under GST Law? Whether any supply has been categorized as deemed export by the Government?
Ans. Deemed export has been defined under Section 2(39) of CGST Act, 2017 as supplies of goods as may be notified und

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A supplier of deemed export supplies has to submit following documents for claiming refund:
(i) Acknowledgment by the jurisdictional Tax officer of the Advance Authorisation holder or Export Promotion Capital Goods Authorisation holder, as the case may be, that the said deemed export supplies have been received by the said Advance Authorisation or Export Promotion Capital Goods Authorisation holder, or a copy of the tax invoice under which such supplies have been made by the supplier, duly signed by the recipient Export Oriented Unit that said deemed export supplies have been received by it.
(ii) An undertaking by the recipient of deemed export supplies that no input tax credit on such supplies has been availed of by him.
(iii) An undertaking by the recipient of deemed export supplies that he shall not claim the refund in respect of such supplies and the supplier may claim the refund.
(Notification No. 49/2017-Central Tax dated 18th October, 2017)
Q 17. When an exporter cannot use

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Customs), except for capital goods)
In the above cases, he needs to avail refund of unutilised ITC as per Rule 89(4A) / (4B) (Notification No. 54/2018 – Central Tax dated 09.10.2018)
Q 18. What would be the GST rate if the product procured by merchant exporter at 0.1 per cent is further exported on payment of IGST?
Ans. The option of payment of IGST and taking refund is not available in case the exporter has procured the goods under 0.1% scheme. He should avail the LUT facility while exporting such goods so that there is no tax liability at the time of export.
Q 19. Can we export under normal procedure without availing the benefit of 0.1 per cent while procuring goods for exports?
Ans. Yes, the facility of procuring goods at 0.1 per cent is an optional facility which is available subject to adhering to the conditions mentioned in Notification no. 41/2017-Integrated Tax (Rate) dated 23rd October, 2017. In case, an exporter wants to procure the goods for exports on payment of applic

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ose the Bond/LUT route and not payment of integrated tax route. Once the goods are exported, refund of unutilized credit can be availed under Section 16(3)(a) of IGST Act, 2017 and Section 54 of the CGST Act, 2017 and the rules made there.
Q 22. What is the rate of duty on sale of MEIS/SEIS scrips?
Ans. The MEIS/SEIS scrips are classifiable under HSN code 4907 and the sale of such scrips is exempted vide S. No. 122A of Notification No. 2/2017-Central Tax (Rate) dated 28.06.2017, as amended vide Notification No. 35/2017-Central Tax (Rate) dated 13.10.2017.
Q 23. Whether sale of DFIA scrips liable to GST?
Ans. As per Notification No. 35/2017-Central Tax (Rate) dated 13.10.2017, “Duty Credit scrips” are exempted from GST. DFIA scrips are not “Duty Credit scrips” and therefore are leviable to GST @ 12%.
Q 24. Can a person opting for composition scheme make supply of goods to SEZ?
Ans. No, because all supplies to SEZ are treated as interState supplies. A person paying tax under compo

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red in India, the commission paid to him will not be taxable.
Q 26. Whether commission received by a buying agent for helping procuring goods from an exporter is exempted from GST?
Ans. Situation I- Buying agent is located in India: The buying commission received by buying agent in India from the importer overseas in foreign exchange will be taxable as the agent is covered in definition of intermediary and therefore place of supply is in India.
Situation II- Buying agent is located outside India: The buying commission received will not be taxable as place of supply will be outside India.
Q 27. Does GST be payable on goods not intended to be sold, taken out for participation in overseas exhibitions and trade fairs and brought back into India after exhibition?
Ans. GST is not payable in such cases. Exporters will need exhibition participation letter and no foreign exchange involved letter from the concerned bank for the purpose of exchange control requirements.
At the time of re-im

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plier's account so that GST could be paid by the supplier on the basis of the amount transferred in his e-Wallet by the exporter. The working capital requirement in the ecosystem would get reduced by the amount of the notional credit given in the e-Wallets. This credit would be used to pay IGST, GST etc. The details of the scheme are being worked out and will be announced later.
Q 29. Whether section 16 of the IGST applicable to exports in respect of compensation cess?
Ans. Section 11(2) of the GST (Compensation to States) Act, 2017 provides that provisions of IGST Act, and the rules made thereunder, shall, mutatis mutandis, apply in relation to the levy and collection of the cess leviable under section 8 on the inter-State supply of goods and services as they apply in relation to the levy and collection of integrated tax on such inter-State supplies under the said Act.
Thus, provisions of section 16 of the IGST Act, 2017, relating to zero rated supply will apply mutatis mutandis fo

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Overview of the IGST Act
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
20. Overview of the IGST Act
Q 1.  What is IGST?
Ans. “Integrated Goods and Services Tax” (IGST) means tax levied under the IGST Act on the supply of any goods and/ or services in the course of inter-State trade or commerce.
Q 2.  What are inter-state supplies?
Ans. A supply of goods and/or services in the course of inter-State trade or commerce means any supply where the location of the supplier and the place of supply are in different States, two different union territory or in a state and union territory Further import of goods and services, supplies to SEZ units or developer, or any supply that is not an intra state supply. (Section 7 of the IGST Act).
Q 3. How will the Inter-State supplies of Goods and Services be taxed under GST?
Ans. IGST shall be levied and collected by Centre on interstate supplies. IGST would be broadly CGST plus SGST and shall be

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he time at which the movement of goods terminates for delivery to the recipient. Where the supply does not involve movement of goods, the place of supply shall be the location of such goods at the time of delivery to the recipient. In the case of goods assembled or installed at site, the place of supply shall be the place of such installation or assembly. Finally, where the goods are supplied on board a conveyance, the place of supply shall be the location at which such goods are taken on board.
The law also provides for determination of place of supply of service where both supplier and recipient are located in India (domestic supplies) or where supplier or recipient is located outside India (international supplies). This is discussed in details in the next Chapter.
It also provides for certain other specific provisions like payment of tax by online information and database access service provider located outside India to an unregistered person in India, upon taking registration in

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n principle and the tax revenue in case of SGST will accrue to the State where the imported goods and services are consumed. Full and complete set-off will be available as ITC of the IGST paid on import on goods and services. Exports of goods and services will be zero rated. The exporter has the option either to export under bond without payment of duty and claim refund of ITC or pay IGST at the time of export and claim refund of IGST. The IGST on imports is leviable under the provisions of the Customs Tariff Act and shall be levied at the time of imports along with the levy of the Customs Act (Section 5 of the IGST Act)
Q 7.  How will the IGST be paid?
Ans. The IGST payment can be done utilizing ITC or by cash. However, the use of ITC for payment of IGST will be done using the following hierarchy, –
* First available ITC of IGST shall be used for payment of IGST;
* Once ITC of IGST is exhausted, the ITC of CGST shall be used for payment of IGST;
* If both ITC of IGST and

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Offences, Penalties, Prosecution and Compounding
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
19. Offences, Penalties, Prosecution and Compounding
Q 1. What are the prescribed offences under CGST/SGST Act?
Ans. The CGST/SGST Act codifies the offences and penalties in Chapter XVI. The Act lists 21 offences in section 122, apart from the penalty prescribed under section 10 for availing compounding by a taxable person who is not eligible for it. The said offences are as follows: –
1) Making a supply without invoice or with false/ incorrect invoice;
2) Issuing an invoice without making supply;
3) Not paying tax collected for a period exceeding three months;
4) Not paying tax collected in contravention of the CGST/SGST Act for a period exceeding 3 months;
5) Non deduction or lower deduction of tax deducted at source or not depositing tax deducted at source under section 51;
6) Non collection or lower collection of or non- payment of tax c

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an officer in terms of the Act/Rules or furnishing false information/documents during the course of any proceeding;
18) Supplying/transporting/storing any goods liable to confiscation;
19) Issuing invoice or document using GSTIN of another person;
20) Tampering/destroying any material evidence;
21) Disposing of /tampering with goods detained/ seized/attached under the Act.
Q 2.  What is meant by the term penalty?
Ans. The word “penalty” has not been defined in the CGST/SGST Act but judicial pronouncements and principles of jurisprudence have laid down the nature of a penalty as:
* a temporary punishment or a sum of money imposed by statute, to be paid as punishment for the commission of a certain offence;
* a punishment imposed by law or contract for doing or failing to do something that was the duty of a party to do.
Q 3. What are the general disciplines to be followed while imposing penalties?
Ans. The levy of penalty is subject to a certain disciplinary regime whic

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case where the tax involved is less than ₹ 5000), or
* a procedural requirement of the law, or
* an easily rectifiable mistake/omission in documents (explained in the law as an error apparent on record) that has been made without fraudulent intent or gross negligence
Further, wherever penalty of a fixed amount or a fixed percentage has been provided in the CGST/SGST Act, the same shall apply.
Q 4. What is the quantum of penalty provided for in the CGST /SGST Act?
Ans. Section 122(1) provides that any taxable person who has committed any of the offences mentioned in section 122 shall be punished with a penalty that shall be higher of the following amounts:
* The amount of tax evaded, fraudulently obtained as refund, availed as credit, or not deducted or collected or short deducted or short collected, or
* A sum of ₹ 10,000/-.
* Further Section 122(2) provides that any registered person who has not paid tax or makes a short payment of taxon supplies shall be a l

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prescribed shall be punishable with a penalty that may extend to ₹ 25,000/-
Q 7. What action can be taken for transportation of goods without valid documents or attempted to be removed without proper record in books?
Ans. If any person transports any goods or stores any such goods while in transit without the documents prescribed under the Act (i.e. invoice and a declaration) or supplies or stores any goods that have not been recorded in the books or accounts maintained by him, then such goods shall be liable for detention along with any vehicle on which they are being transported.
Where owner comes forward: – Such goods shall be released on payment of the applicable tax and penalty equal to 100% tax or upon furnishing of security equivalent to the said amount.
In case of exempted goods, penalty is 2% of value of goods or ₹ 25,000/- whichever is lesser.
Where owner does not come forward: – Such goods shall be released on payment of the applicable tax and penalty equal

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riate (private property) to the public treasury by way of penalty; to deprive of property as forfeited to the State.”
In short in means transfer of the title to the goods to the Government.
Q 10. Under which circumstances can goods be confiscated under CGST/SGST Act?
Ans. Under Section 130 of the CGST Act, goods shall be liable to confiscation if any person:
* supplies or receives any goods in contravention of any provision of this Act and such contravention results in evasion of tax payable under the Act, or
* does not account for any goods in the manner required under the Act, or
* supplies goods that are liable to tax under the Act without applying for registration, or
* uses any conveyance as a means of transport for carriage of goods in contravention of the provisions of CGST/SGST Act (unless used without knowledge of owner)
* contravenes any provision of the Act/Rules with the intention of evading payment of tax.
Q 11. What happens to the goods upon confiscation of

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ere being transported without cover of the required documents/declarations without his knowledge or connivance or without the knowledge or connivance of his agent then the conveyance shall not be liable to confiscation as aforesaid.
Q 14. What is Prosecution?
Ans. Prosecution is the institution or commencement of legal proceeding; the process of exhibiting formal charges against the offender. Section 198 of the Criminal Procedure Code defines “prosecution” as the institution and carrying on of the legal proceedings against a person.
Q 15. Which are the offences which warrant prosecution under the CGST/SGST Act?
Ans. Section 132 of the CGST/SGST Act codifies the major offences under the Act which warrant institution of criminal proceedings and prosecution. 12 such major offences have been listed as follows:
a) Making a supply without issuing an invoice or upon issuance of a false/incorrect invoice;
b) Issuing an invoice without making supply;
c) Not paying any amount collected as

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prescribed on conviction of any offence under the CGST/SGST Act?
Ans. The scheme of punishment provided in section 132(1) is as follows:
Offence involving
Punishment (Imprisonment extending to)
Tax evaded exceeding ₹ 5 crore or repeat offender250 lakh 
5 years and fine
Tax evaded between ₹ 2 crore and ₹ 5 crore 
3 years and fine
Tax evaded between ₹ 1 crore and ₹ 2 crore 
1 years and fine
* False records
* Obstructing officer
* Tamper records 
6 months
Q 17. What are cognizable and non-cognizable offences under CGST/SGST Act?
Ans. In terms of Section 132(4) and 132(5) of CGST/SGST Act
* all offences where the evasion of tax is less than ₹ 5 crores shall be non-cognizable and bailable,
* all offences where the evasion of tax exceeds ₹ 5 crores shall be cognizable and non- bailable.
Q 18. Is prior sanction of competent authority mandatory for initiating prosecution?
Ans. Yes. No person shall be prosecuted

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of its business shall, along-with the company itself, be liable to be proceeded against and punished for an offence committed by the company while such person was in-charge of the affairs of the company. If any offence committed by the company-
* has been committed with the consent/connivance of, or
* is attributable to negligence of-
any officer of the company then such officer shall be deemed to be guilty of the said offence and liable to be proceeded against and punished accordingly.
Q 22. What is meant by compounding of offences?
Ans. Section 320 of the Code of Criminal Procedure defines “compounding” as to forbear from prosecution for consideration or any private motive.
Q 23. Can offences under CGST/SGST Act be compounded?
Ans. Yes. As per section 138 of the CGST/SGST Act, any offence, other than the following, may upon payment of the prescribed (compounding) amount be compounded and such compounding is permissible either before or after the institution of prosecution:

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e greater of the following amounts: –
* 50% of tax involved, or
* ₹ 10,000.
The upper limit for compounding amount is to be greater of the following amounts: –
* 150% of tax involved or
* ₹ 30,000.
Q 25. What is the procedure for compounding of offences?
Ans. The applicant has to make an application in form GST CPD-01 to the Commissioner for compounding of an offence. The application is not allowed unless the tax, interest and penalty liable to be paid have been paid in the case for which the application has been made
On receipt of the application, the Commissioner shall call for a report from the concerned officer with reference to the particulars furnished in the application, or any other information, which may be considered relevant for the examination of such application.
The Commissioner, after taking into account the contents of the said application, may, by order in FORM GST CPD-02, on being satisfied that the applicant has cooperated in the proceedings

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Inspection, Search, Seizure and Arrest
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
18. Inspection, Search, Seizure and Arrest
Q 1. What is the meaning of the term “Search”?
Ans. As per law dictionary and as noted in different judicial pronouncements, the term 'search', in simple language, denotes an action of a government machinery to go, look through or examine carefully a place, area, person, object etc. in order to find something concealed or for the purpose of discovering evidence of a crime. The search of a person or vehicle or premises etc. can only be done under proper and valid authority of law.
Q 2. What is the meaning of the term “Inspection”?
Ans. 'Inspection' is a new provision under the CGST/SGST Act. It is a softer provision than search to enable officers to access any place of business of a taxable person and also any place of business of a person engaged in transporting goods or who is an owner or an operator of a wareho

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of any premises or to break open any almirah, electronic devices, box, receptacle in which any goods, accounts, registers or documents of the person are suspected to be concealed, where access to such premises, almirah, electronic devices, box or receptacle is denied. (Section 67(4) of the Act).
Q 5. Whether the person from whose custody any documents are seized is entitled to get the copies thereof?
Ans. Yes, the person from whose custody documents are seized is entitled to make copies thereof or take extracts therefrom in the presence of an authorised officer at such place and time as such office may indicate in this behalf except where making such copies or taking such extracts may, in the opinion of the proper office, prejudicially affect the investigation. (Section 67(5) of the Act.)
Q 6. Can the proper officer authorize Inspection of any assets/premises of any person under this Section?
Ans. No. Authorization can be given to an officer of CGST/ SGST Act. to carry out inspecti

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ection 26 of the IPC, 1860, “A person is said to have 'reason to believe' a thing, if he has sufficient cause to believe that thing but not otherwise.” 'Reason to believe' contemplates an objective determination based on intelligent care and evaluation as distinguished from a purely subjective consideration. It has to be and must be that of an honest and reasonable person based on relevant material and circumstances.
Q 9. Is it mandatory that such 'reasons to believe' has to be recorded in writing by the proper officer, before issuing authorization for Inspection or Search and Seizure?
Ans. Although the officer is not required to state the reasons for such belief before issuing an authorization for search, he has to disclose the material on which his belief was formed. 'Reason to believe' need not be recorded invariably in each case. However, it would be better if the materials / information etc. are recorded before issue of search warrant or before conducting search.
Q 10. What is

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of this Act or rules made thereunder leading to evasion of tax;
(ii) does not account for any goods on which he is liable to pay tax under this Act;
(iii) supplies any goods liable to tax under this Act without having applied for the registration;
(iv) contravenes any of the provisions of the CGST/ SGST Act or rules made thereunder with intent to evade payment of tax.
Q 12. What powers can be exercised by an officer during valid search?
Ans. An officer carrying out a search has the power to search for and seize goods (which are liable to confiscation) and documents, books or things (relevant for any proceedings under CGST/SGST Act) from the premises searched. During search, the officer has the power to break open the door of the premises authorized to be searched if access to the same is denied. Similarly, while carrying out search within the premises, he can break open any almirah or box if access to such almirah or box is denied and in which any goods, account, registers or doc

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ses and his signature should be taken on the body of the search warrant in token of having seen the same. The signatures of at least two witnesses should also be taken on the body of the search warrant.
* The search should be made in the presence of at least two independent witnesses of the locality. If no such inhabitants are available/willing, the inhabitants of any other locality should be asked to be witness to the search. The witnesses should be briefed about the purpose of the search.
* Before the start of the search proceedings, the team of officers conducting the search and the accompanying witnesses should offer themselves for their personal search to the person in-charge of the premises being searched. Similarly, after the completion of search all the officers and the witnesses should again offer themselves for their personal search.
* A Panchnama / Mahazar of the proceedings of the search should necessarily be prepared on the spot. A list of all goods, documents recove

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iness premises under any other circumstances?
Ans. Yes. Access can also be obtained in terms of Section 65 of CGST/SGST Act. This provision of law is meant to allow an audit party of CGST/SGST or C&AG or a cost accountant or chartered accountant nominated under section 66 of CGST/SGST Act, access to any business premises without issuance of a search warrant for the purposes of carrying out any audit, scrutiny, verification and checks as may be necessary to safeguard the interest of revenue. However, a written authorization is to be issued by an officer of the rank of Commissioner of CGST or SGST. This provision facilitates access to a business premise which is not registered by a taxable person as a principal or additional place of business but has books of accounts, documents, computers etc. which are required for audit or verification of accounts of a taxable person.
Q 16. What is meant by the term 'Seizure'?
Ans. The term 'seizure' has not been specifically defined in the GST Law

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s to the owner of the property or the person who possesses the property at a particular point of time by a legal order/notice is called detention. Seizure is taking over of actual possession of the goods by the department. Detention order is issued when it is suspected that the goods are liable to confiscation. Seizure can be made only on the reasonable belief which is arrived at after inquiry/investigation that the goods are liable to confiscation.
Q 19. What are the safeguards provided in GST Act(s) in respect of Search or Seizure?
Ans. Certain safeguards are provided in section 67 of CGST/SGST Act in respect of the power of search or seizure. These are as follows:
i. Seized goods or documents should not be retained beyond the period necessary for their examination;
ii. Photocopies of the documents can be taken by the person from whose custody documents are seized;
iii. For seized goods, if a notice is not issued within six months of its seizure, goods shall be returned to the p

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otherwise the goods shall be returned to the person from whose possession they were seized. However, the period of six months, on sufficient cause being shown can be extended by the proper officer for a further period not exceeding six months. (Section 67(7) of the Act.)
Q 21. Can the goods be sold by the department after seizure?
Ans. Yes. 17 types of goods have been prescribed in the Notification No. 27/2018-Central Tax dated 13th June, 2018 which can be disposed of, after seizure, by the proper officer, having regard to the perishable or hazardous nature, depreciation in value with the passage of time, constraints of storage space or any other relevant considerations. The list is as under:
(i) Salt and hygroscopic substances
(ii) Raw (wet and salted) hides and skins
(iii) Newspapers and periodicals
(iv) Menthol, Camphor, Saffron
(v) Re-fills for ball-point pens
(vi) Lighter fuel, including lighters with gas, not having arrangement for refilling
(vii) Cells, batteries and r

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ny special document required to be carried during transport of taxable goods?
Ans. Under section 68 of CGST /SGST Act, a person in charge of a conveyance carrying any consignment of goods of value exceeding a specified amount may be required to carry a prescribed document as prescribed in the E way Bill Rules. Chapter XVI of CGST Rules contains provisions relating to documents required to be carried.
Q 23. What is meant by the term “arrest”?
Ans. The term 'arrest' has not been defined in the CGST/SGST Act. However, as per judicial pronouncements, it denotes 'the taking into custody of a person under some lawful command or authority'. In other words, a person is said to be arrested when he is taken and restrained of his liberty by power or colour of lawful warrant.
Q 24. When can the proper officer authorize 'arrest' of any person under CGST / SGST Act?
Ans. The Commissioner of CGST/SGST can authorize a CGST/SGST officer to arrest a person if he has reasons to believe that the pers

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for a person who is placed under arrest. These are:
a) If a person is arrested for a cognizable offence, he must be informed in writing of the grounds of arrest and he must be produced before a magistrate within 24 hours of his arrest;
b) If a person is arrested for a non-cognizable and bailable offence, the Deputy/ Assistant Commissioner of CGST/SGST can release him on bail and he will be subject to the same provisions as an officer in-charge of a police station under section 436 of the Code of Criminal Procedure, 1973;
c) All arrest must be in accordance with the provisions of the Code of Criminal Procedure, 1973 relating to arrest.
Q 26. What are the precautions to be taken during arrest?
Ans. The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) relating to arrest and the procedure thereof must be adhered to. It is therefore necessary that all field officers of CGST/SGST be fully familiar with the provisions of the Code of Criminal Procedure, 1973.
One important

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accurate, visible and clear identification and name tags with their designations. The particulars of all such police personnel who handle interrogation of the arrestee must be recorded in a register.
ii. The police officer carrying out the arrest shall prepare a memo of arrest at the time of arrest and such memo shall be attested by at least one witness, who may be either a member of the family of the arrestee or a respectable person of the locality from where the arrest is made. It shall also be counter signed by the arrestee and shall contain the time and date of arrest.
iii. A person who has been arrested or detained and is being held in custody in a police station or interrogation center or other lock up, shall be entitled to have one friend or relative or other person known to him or having interest in his welfare being informed, as soon as practicable, that he has been arrested and is being detained at the particular place, unless the attesting witness of the memo of arrest is

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o the arrestee.
vii. The arrestee should be subjected to medical examination by the trained doctor every 48 hours during his detention in custody by a doctor on the panel of approved doctors appointed by Director, Health Services of the concerned State or Union Territory, Director, Health Services should prepare such a panel for all Tehsils and Districts as well.
viii. Copies of all the documents including the memo of arrest, referred to above, should be sent to the Magistrate for his record.
ix. The arrestee may be permitted to meet his lawyer during interrogation, though not throughout the interrogation.
x. A police control room should be provided at all district and State headquarters where information regarding the arrest and the place of custody of the arrestee shall be communicated by the officer causing the arrest, within 12 hours of effecting the arrest and at the police control room it should be displayed on a conspicuous notice board.
Q 27. What are the broad guidelines

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ses; and
viii. large amounts of evasion of duty or service tax at least exceeding one crore rupees.
Q 28. What is a cognizable offence?
Ans. Generally, as per Cr. PC, cognizable offence means serious category of offences in respect of which a police officer has the authority to make an arrest without a warrant and to start an investigation with or without the permission of a court. However, GST being a special legislation, only the officers, duly empowered under the Act can act as above.
Q 29. What is a non-cognizable offence?
Ans. Non-cognizable offence means relatively less serious offences in respect of which a police officer does not have the authority to make an arrest without a warrant and an investigation cannot be initiated without a court order, except as may be authorized under special legislation.
Q 30. What are cognizable and non-cognizable offences under CGST Act?
Ans. In section 132 of CGST Act, it is provided that the offences relating to taxable goods and /or ser

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on or by an authorized representative and he is bound to state the truth before the officer who has issued the summon upon any subject which is the subject matter of examination and to produce such documents and other things as may be required.
Q 33. What can be the consequences of non- appearance to summons?
Ans. The proceeding before the official who has issued summons is deemed to be a judicial proceeding. If a person does not appear on the date when summoned without any reasonable justification, he can be prosecuted under section 174 of the Indian Penal Code (IPC). If he absconds to avoid service of summons, he can be prosecuted under section 172 of the IPC and in case he does not produce the documents or electronic records required to be produced, he can be prosecuted under section 175 of the IPC. In case he gives false evidence, he can be prosecuted under section 193 of the IPC. In addition, if a person does not appear before a CGST/ SGST officer who has issued the summons, he

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written permission, oral/ telephonic permission from such officer must be obtained and the same should be reduced to writing and intimated to the officer according such permission at the earliest opportunity;
v. in all cases, where summons are issued, the officer issuing summons should submit a report or should record a brief of the proceedings in the case file and submit the same to the officer who had authorized the issuance of summons;
vi. senior management officials such as CEO, CFO, General Managers of a large company or a Public Sector Undertaking should not generally be issued summons at the first instance. They should be summoned only when there are indications in the investigation of their involvement in the decision making process which led to loss of revenue.
Q 35. What are the precautions to be observed while issuing summons?
Ans. The following precautions should generally be observed when summoning a person: –
(i) A summon should not be issued for appearance where it

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egories specified are as follows:
i. Police;
ii. Railways
iii. Customs;
iv. Officers of State/UT/ Central Government engaged in collection of GST;
v. Officers of State/UT/ Central Government engaged in collection of land revenue;
vi. All village officers;
vii. Any other class of officers as may be notified by the Central/State Government.
Q 37. Is there any prescribed format for arrest memo under the CGST Act, 2017?
Ans. There is no prescribed format for arrest memo but an arrest memo must be in compliance with the directions in the judgments of the Hon'ble Supreme Court in the case of D.K. Basu v/s. State of West Bengal reported in 1997 (1) SCC 416 =1996 (12) TMI 350 – SUPREME COURT. The arrest memo should include: –
* Brief Facts of the case;
* Details of the person arrested;
* Gist of evidence against the person;
* Relevant section(s) of the CGST/SGST Law or other laws attracted to the case and to the arrested person;
* The grounds of the arrest must be explaine

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Advance Ruling
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
17. Advance Ruling
Q 1. What is the meaning of Advance Ruling?
Ans. An 'advance ruling' means a decision provided by the authority or the Appellate Authority to an applicant on matters or on questions specified in section 97(2) or 100(1) of CGST/SGST Act as the case may be, in relation to the supply of goods and/or services proposed to be undertaken or being undertaken by the applicant. (section 95 of CGST/SGST Law and section 12 of UTGST law) Authority for Advance Rulings(AAR) are appointed under the respective SGST/UTGST Act(s) and the same are deemed to be the Authority for advance ruling under CGST Act also in respect of that State or Union territory.
Q 2. Which are the questions for which advance ruling can be sought?
Ans. Advance Ruling can be sought for the following questions:
(a) classification of any goods or services or both;
(b) applicability of a notification issu

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ents
(iii) attract Foreign Direct Investment (FDI);
(iv) reduce litigation;
(v) pronounce ruling expeditiously in transparent and inexpensive manner.
Q 5. What will be the composition of Authority for advance rulings (AAR) under GST?
Ans. 'Authority for advance ruling' (AAR) shall comprise one member CGST and one member SGST/UTGST. They will be appointed by the Central and State government respectively.
Q 6. Is it necessary for a person seeking advance ruling to be registered?
Ans. No, any person registered under the GST Act(s) or desirous of obtaining registration can be an applicant. (Section 95(b))
Q 7. At what time an application for advance ruling be made?
Ans. An applicant can apply for advance ruling even before taking up a transaction (proposed supply of goods or services) or in respect of a supply which is being undertaken. The only restriction is that the question being raised is already not pending or decided in any proceedings in the case of applicant.
Q 8. What i

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cant, or the jurisdictional officer, if aggrieved by any advance ruling, may appeal to the Appellate Authority.
Q 11. How many AAR and AAAR are constituted under GST?
Ans. There is one AAR and AAAR constituted for each State. Details of addresses, contact details along with emails of AAR are available at- http://www.gstcouncil.gov.in/sites/default/files/Details%20of%20AAR%2030-11-18.pdf. Similarly, the details of AAAR are available at- http://www.gstcouncil.gov.in/sites/default/files/AAAR-ason-14-12-2018.pdf.
Q 12. To whom will the Advance Ruling be applicable?
Ans. The advance rulings are given in personem and not in rem, that is, not to the whole world and therefore, rulings cannot apply to other similar cases. Section 103 provides that an advance ruling pronounced by AAR or AAAR shall be binding only on the applicant who sought it in respect of any matter referred to in 97 (2) and on the jurisdictional tax authority of the applicant. This clearly means that an advance ruling is

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s that an advance ruling shall be held to be ab initio void if the AAR or AAAR finds that the advance ruling was obtained by the applicant by fraud or suppression of material facts or misrepresentation of facts. In such a situation, all the provisions of the GST Act(s) shall apply to the applicant as if such advance ruling had never been made (but excluding the period when advance ruling was given and up to the period when the order declaring it to be void is issued). An order declaring advance ruling to be void can be passed only after hearing the applicant.
Q 16. What is the procedure for obtaining Advance Ruling?
Ans. Section 97 and 98 deals with procedure for obtaining advance ruling. The applicant desirous of obtaining advance ruling should make application to AAR in form GST ARA-01. The format of the form and the detailed procedure for making application is prescribed in the CGST Rules.
Section 98 provides the procedure for dealing with the application for advance ruling. The

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shed by the applicant or by the concerned departmental officer.
Before giving the ruling, AAR must hear the applicant or his authorized representative as well as the jurisdictional officers of CGST/SGST/UTGST.
Q 19. What happens if there is a difference of opinion amongst members of AAR?
Ans. If there is difference of opinion between the two members of AAR, they shall refer the point or points on which they differ to the AAAR for hearing the issue. If the members of AAAR are also unable to come to a common conclusion in regard to the point(s) referred to them by AAR, then it shall be deemed that no advance ruling can be given in respect of the question on which difference persists at the level of AAAR.
Q 20. What are the provisions for appeals against order of AAR?
Ans. The provisions of appeal before AAAR are dealt in section 100 and 101 of CGST/SGST Act or section 14 of the UTGST Act.
If the applicant is aggrieved with the finding of the AAR, he can file an appeal with AAAR. Si

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Q 21. Whether Appeal can be filed before High Court or Supreme Court against the ruling of Appellate Authority for Advance Rulings?
Ans. The CGST /SGST Act do not provide for any appeal against the ruling of Appellate Authority for Advance Rulings. Thus no further appeals lie and the ruling shall be binding on the applicant as well as the jurisdictional officer in respect of applicant.
However, Writ Jurisdiction may lie before Hon'ble High Court or the Supreme Court.
Q 22. Can the AAR & AAAR order for rectification of mistakes in the ruling?
Ans. Yes, AAR and AAAR have power to amend their order to rectify any mistake apparent from the record within a period of six months from the date of the order. Such mistake may be noticed by the authority on its own accord or may be brought to its notice by the applicant or the concerned or the jurisdictional CGST/SGST officer. If a rectification has the effect of enhancing the tax liability or reducing the quantum of input tax credit, the a

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