Author: admin_gst

GST – States – EXN-F(10)-24/2018 – 51/2018-State Tax – Dated:- 17-9-2018 – EXCISE AND TAXATION DEPARTMENT NOTIFICATION No. 51/2018-State Tax Shimla-2, the 17th September, 2018 No. EXN-F(10)-24/2018-Loose.-In exercise of the powers conferred by sub-section (3) of section 1 of the Himachal Pradesh Goods and Services Tax Act, 2017 (10 of 2017) (hereinafter referred to as the said Act), the Governor of Himachal Pradesh is pleased to appoint the 1st day of October, 2018, as the date on which the pro

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GST – States – 05/2018-19 – Dated:- 17-9-2018 – Government of Karnataka (Department of Commercial Taxes) No. KSA/GST/CR-108/2017-18 Office of the Commissioner of Commercial Taxes Vanijya Therige Karyalaya, Gandhinagar, Bengaluru-560009, Dated: 17-09-2018 COMMISSIONER OF COMMERCIAL TAXES CIRCULAR No. GST-05/2018-19 Subject: regarding Attention is invited to CCT Circular No. GST-02/2018-19 dated 16th April, 2018 vide which the procedure for interception of conveyances for inspection of goods in movement, and detention, release and confiscation of such goods and conveyances was specified. 2. In order to clarify certain issues regarding the specified procedure in this regard and in order to ensure uniform implementation of the provisions of the Karnataka Goods and Services Tax Act, (hereinafter referred to as the KGS T Act ), in exercise of the powers conferred under section 168(1) of the KGS T Act, the following modifications are hereby issued to the said Circular:- (i) In para 2 (e) of

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to the procedure to be followed in such situations. (i) In this regard, it is clarified that the hard copies of the notices/orders issued in the specified FORMS by a tax authority may be shown as proof of initiation of action by a tax authority by the transporter/registered person to another tax authority as and when required. (ii) Further, it is clarified that only such goods and/or conveyances should be detained/confiscated in respect of which there is a violation of the provisions of the GST Acts or the rules made thereunder. Illustration: Where a conveyance carrying twenty-five consignments is intercepted and the person-in-charge of such conveyance produces valid e-way bills and/or other relevant documents in respect of twenty consignments, but is unable to produce the same with respect to the remaining five consignments, detention/confiscation can be made only with respect to the five consignments and the conveyance in respect of which the violation of the Act or the rules made th

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n of the provisions of the law takes place and the provisions of section 129 and section 130 of the KGS T Act are invocable. Further, it may be noted that the non-furnishing of information in Part B of FORM GST EWB-01 amounts to the e-way bill becoming not a valid document for the movement of goods by road as per Explanation (2) to rule 138(3) of the KGS T Rules, except in the case where the goods are transported for a distance of upto fifty kilometres within the State to or from the place of business of the transporter to the place of business of the consignor or the consignee, as the case may be. 6. Whereas, section 129 of the KGST Act provides for detention and seizure of goods and conveyances and their release on the payment of requisite tax and penalty in cases where such goods are transported in contravention of the provisions of the KGST Act or the rules made thereunder. It has been informed that proceedings under section 129 of the KGST Act are being initiated for every mistake

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2018 (9) TMI 1515 – CESTAT CHENNAI – TMI – Demand of service tax – Reversal of Cenvat Credit – Scope of SCN – Non-speaking order – main grievance of the department is that the impugned order is a non-speaking order without giving detailed findings either to support or counter the arguments of the noticee but has simply confirmed demands proposed in the notice and the statement of demand – principles of natural justice – Held that:- The SCN had alleged in para 5.1 that “value of goods (sold during taxable service) is to be included in the gross value of taxable service under section 67 of the Finance Act, 1994”. The same paragraph also alleges that “assessees are liable to pay an amount of 5% of gross value of exempted service as per explanation 1(a) to rule 6(3) and 6(3A) of CENVAT Credit Rules, 2004 – These are the only two alleged infractions raised in the show cause notice. There is no other allegation or infraction that has been brought out in the show cause notice dated 11.6.2013

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the adjudicating authority has chosen to apply the facts of the case to the said circular dated 23.8.2008, particularly, when the said circular pertains to a period prior to the amendment introduced under Rule 2(e) of CENVAT Credit Rules, 2004 amplifying the definition of exempted service to include “trading”.
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It is evident that the order of the adjudicating authority has not addressed the allegations and concerns raised in the show cause notice but has instead veered off into other areas which have not been alleged in the notice or in the statement of demand – Thus, the adjudicating authority has not given any speaking order based on the allegations and charges proposed in the notice / statement of demand.
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The impugned order not having addressed the allegations in the show cause notice but having only confirmed the proposed demands on other grounds cannot be sustained – case remanded for fresh adjudication based on the allegations and charges made out in the show cause no

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credit they have opted to pay 5% of tax in the gross profit on the trading activity as per Rule 6(3) of the CENVAT Credit Rules, 2004; and They will be availing credit for all the input services, except certain input services if used for exclusively rendering any exempted services. 1.1 Vide another letter Ref. CO/ST/44 dated nil, the assessees clarified that they at arrived 5% of difference between sale price on the cost of goods sold, which may be called as gross profit; that in their goods the difference between sale price and cost of goods sold is more than 10% of cost of goods; that such computation was done as per Explanation (C) to Rule 6(3) of CENVAT Credit Rules, 2004 vide Notification No. 13/2011-CE (NT) dated 31.3.2011. In response, the jurisdictional Assistant Commissioner vide letter dated 29.12.2011, informed the assessees to pay an amount equal to 5% on taxable value determined under Section 67 of the Finance Act, 1994 i.e. 5% of the gross value of the franchisee service

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nvolving painting, tinkering and repair of accident vehicles. They further pointed out that the entire consideration including the cost of materials, consumables and labour is offered to service tax, being a works contract. They have neither claimed exemption nor cleared the goods as non-taxable sale transaction. Having paid service tax on the entire value, the question of applying explanation 1(C) to Rule 6(3) for these transactions does not arise; and They also render pure labour and service contracts which do not involve any transfer or sale of materials. Service tax has been remitted on the entire labour cost and here again Explanation 1(C) to Rule 6(3). The assessee concluded that the request to pay a sum equal to duty for the entire sales turnover, is clearly impermissible and is sought to be re-assessed. They do not have any other transaction at present to be governed by explanation 1(C) to Rule 6(3) and Thus, the request to pay a sum equal to duty for the entire sales turnover

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ng of goods, but is actually sale of goods in the course of providing taxable services (franchisee service and servicing of motor vehicles) 1.4 In view of the above, it appears that the value of such goods (sold during the course of providing taxable services) is to be included in the gross value of taxable services under Section 67 of the Finance Act, 1994 and that the assessee are liable to pay an amount of 5% on gross value of exempted services as per Explanation 1(a) to Rule 6(3) and 6(3A) of CENVAT Credit Rules, 2004 read along with Rule 2(e), in addition to payment of 5% on gross profit on trading activity as per Explanation 1(C) to Rule 6(3) and 6(3A of CENVAT Credit Rules, 2004. 1.5 On such basis, the show cause notice proposed demand of an amount of ₹ 95,94,743/- as service tax liability for the period April 2011 to March 2012 with interest thereon and also for imposition of penalties under various provisions of law. For subsequent period, April 2012 to June 2012, statem

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words, whether value of goods sold which are used or consumed in the course of providing taxable service could be excluded for the purpose of computing taxable value of service iii) Whether in the facts of this case the appellants over and above the payment of 5% of the value of the exempted service namely trading, should include the same in the value of taxable service and whether the benefit of the Notification No. 12/2003-ST can be denied? Whether Commissioner was right in demanding over and above 5% / 6% payment on value of exempted service calculated as per explanation 1(C) to CENVAT Credit Rules 6(3D) and again demanding separately 5% or 6% on the gross profit on sales? iv) Whether in the facts and circumstances of the case amount demanded with interest can be sustained. v) Whether in the facts and circumstances of the case penalty under Rule15 can be sustained. 1.6 Department has also come in appeal against the impugned order before this forum in Appeal No.ST/42339/2015 primaril

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different. It is seen that the notice had sold spares during the course of provision of taxable services namely MRS as is evident from the sample invoices available in the file wherein TVS had indicated the same vehicle registration number which was serviced in the sale invoice also thus connecting the sales to the services provided by them. In respect franchisee service also the franchise was given for servicing of motor vehicles under the brand name of TVS and the spares required for such service were also sold by TVS. Thus in respect of both types, the sales has a direct connection to the services rendered by TVS and so the value of such goods sold would form part of the gross value of service in terms of Section 67. But as there is clear evidence in the invoice to show that the goods were sold and that there was no evidence on record to show that they had availed CENVAT on such goods by TVS, the value of such goods sold during the course of provision of services were eligible for t

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r fresh adjudication. 2. On the date of hearing, on behalf of the assessee, ld. Senior Advocate Shri N. Venkataraman put forth various arguments and contentions which can be broadly summarized as under:- (a) The assessees are engaged in following activities:- (i) Buying and selling parts as pure trading activity (ii) Indivisible works contract for vehicles (iii) Pure labour and service contract when sale of materials (iv) Divisible contract of goods and rendition of servicing. There is no controversy in respect of these activities except in relation to that involving divisible contract of goods and servicing. (b) The appellant themselves only had informed the department vide their letters dated 1.12.2011 and 8.3.2012 regarding the various types of activities done by them and also in particular regarding the manner of reversal of CENVAT credit taken in respect of such contracts. (c) The adjudicating authority instead of providing arguments as to why the method adopted by TVS for payment

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dated 01.03.2003 and that the values of materials sold by them were to be added to the taxable value of services under MRS/FRA services. (d) The show cause notice itself contains contradictions. On one hand, the notice alleges that traded as sold and exempted, and at the same time, the notice also alleges that the value of service should include value of materials sold also. (e) The notice treats sale as other than trading and accordingly seeks to recover an amount equivalent to 5% of value of sale without giving any benefit of abatement. 2.1 In response to further letter from department appellant had vide their letter dated 5.1.2012 clarified inter alia that in respect of sale of products, they are paying 5% on different between sale price and the purchase price, that no input credit is taken and hence no duty is payable. 2.2 In reply to the show cause notice, the appellant had inter alia made the following submissions:- 2.3 The following are some of the submissions taken by the appe

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terials and by virtue of the notification mentioned above, in cases of works contract service, only the service portion of the contract is taxable. Therefore the demand that the appellants ought to pay tax on the entire value including the value of materials sold is not acceptable. (v) The greatest contradiction in the subject notice is that on one hand the notice seeks to include value of the parts sold in taxable value of taxable services and at the same time treats such sale as exempted service. (vi) The appellants vide their reply to the Statement of Demand submitted, in addition to the grounds in their reply to Show Cause Notice, the following:- (vii) The officer has not taken into consideration the letter written to the Deputy Commissioner dated 30.012014 before issuing the statement of demand wherein the case of Ketan Motors td (v) CESTAT, Nagpur was enclosed, in which it was held that, if a transaction involves only sale of parts, question of levying service tax would not arise

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f the impugned order in denial of the notification benefit 12/2003-ST dated 10.03.2003 wherever it is applicable, by wrongly interpreting the activity of sale of spare parts as other than sale and also wrongly presuming that credit was taken on inputs which is not factually so. Therefore the finding at Para 18 of the impugned order is also not tenable. Submission made in earlier paragraphs may be taken into consideration in this context. (x) In para 19 of the impugned order, the Commissioner contradicts the reasoning adopted for the demands in question. On the one hand, he gives a finding that the appellants are indulging in trading activity independent of any taxable service e and therefore they are required to pay an amount of 5% on the value of exempted service and at the same time he gives a finding that in addition to the payment of 5% of the gross value of exempted service the appellants should also pay 5% of the gross profit of the trading activity. On the one hand, Commissioner

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ence the reasoning adopted by the commissioner in para 21 based on alleged bifurcation of value of services and goods is also not correct. (xii) In para24 of the impugned order the Commissioner has totally misunderstood the entire concept of sale and service and inclusion of sale value of the goods in the taxable value of service because of his wrong presumption and assumptions and basis which have already been refer to by the appellants in the grounds of appeal. The appellants have also aggrieved that, inspite of various decisions cited before him, Commissioner has not considered any of the said decisions. (xiii) Even otherwise, the whole issue is one of the interpretation of law and rules and Appellants genuinely believed that they had compiled with provisions of Cenvat Credit Rules and provision relating to valuation. (xiv) Therefore for the above reasons the resort to Cenvat Credit Rule 15 for the imposition of penalty is improper, illegal and unsustainable. 3. On the other hand, l

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No. 96/7/2001 ST dated 23.08.2007, citing examples of invoices raised by the notice and discussing the provisions of section 67 of the act and concluded that the Assessee was not eligible for the exemption under Notification N12/2003 ST dated 1.03.2003 and that the value of the materials sold were to be added to the taxable value of services under MRS/FRA services. 3.2 It could be seen from the notice and the documents available on file that the facts were quite different. It is seen that the notice had sold spares during the course of provision of taxable services namely MRS as is evident from the sample invoices available in the file wherein TVS had indicated the same vehicle registration number which was serviced in the sale invoice also thus connecting the sales to the services provided by them. In respect franchisee service also the franchise was not given for servicing of motor vehicles under the brand name of TVS and the spares required for such service were also sold by TVS. T

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CR read with the above definition of exempted services provided under cause (e) of Rule 2 of CCR. The AA has not given any findings either to support this aspect or counter the arguments of the notice and has simply confirmed the demands proposed in the SCN & SOD. Therefore the Order of the AA is a non-speaking order. 3.4 Hence it is very obvious that the order passed by the Commissioner is not legal and proper and is not a speaking order and has not apprised the issues actually raised in the relates show cause notice. Hence, the impugned order may be set aside and the appeal remanded to the Commissioner for denovo adjudication. 4. Heard both sides. 5. We first take up the appeal of the department. The main grievance of the department is that the impugned order is a non-speaking order without giving detailed findings either to support or counter the arguments of the noticee but has simply confirmed demands proposed in the notice and the statement of demand. We find that the show ca

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e. There is no other allegation or infraction that has been brought out in the show cause notice dated 11.6.2013 are for that matter in the statement of demand dated 23.4.2014. 5.1 We find that the adjudicating authority in the impugned order dated 30.6.2015 has framed the issue in para 17 as under:- Now the question is whether the value of the goods sold (traded) during the course of providing taxable services is to be included in the gross value of taxable services under section 67 of the Finance Act, 1994 . 5.2 However, in the same paragraph and in paragraph 18 that follows, the adjudicating authority has gone into the aspect of whether Notification 12/2003-ST dated 1.3.2003 has been fulfilled by the assessee in this case. Discernibly, non-fulfillment of Notification No. 12/2003-ST was not an allegation or charge raised in the show cause notice. True, para 4.4 of the notice dated 11.6.2013 did reproduce a portion of the Notification 12/2003-ST, however, without making any reference

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Further, we find that based on the such discussions, the adjudicating authority in para 20 of the order concluded that value of goods sold is to be included in the gross value of services as assessee has not fulfilled the conditions laid down in Notification 12/2003-ST. 5.3 We also find that in para 17 of the impugned order, the adjudicating authority has stated that assessee has taken credit of duty paid on goods and materials sold by them. Ono the other hand, as per the letter dated 5.1.2012 of the assessees to the jurisdictional Assistant Commissioner at point No. 5 relating to sale of parts to franchisees they have averred that no input credit is taken and hence no duty is payable . 5.4 The assessee also, in their grounds of appeal and other contentions made by them, have consistently found fault with the adjudicating authority which have already been set out above. For example, the appellant has submitted that the Commissioner has contradicted in para 19 of the impugned order, the

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ee has found fault with the reasonings adopted by the adjudicating authority. This being so, the impugned order not having addressed the allegations in the show cause notice but having only confirmed the proposed demands on other grounds cannot be sustained. We therefore are inclined to accept the prayer made by the Revenue seeking remand of the case for fresh adjudication based on the allegations and charges made out in the show cause notice. So ordered. 7. Coming to the assessee‟s appeal, while there are indeed number of persuasive arguments put forth by ld. Senior Advocate, in view of our decision to remand the matter for denovo adjudication, we also allow the present appeals of the assessee by way of remand. Hence in the denovo adjudication, the points and arguments raised by both sides will be addressed by the adjudicating authority, after giving sufficient opportunity to both parties to present their case. All the appeals are allowed by way of remand. (Pronounced in court o

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GST – States – 15/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 15/2018 (Circular No. 12/12/2017-GST) DATED: 17.09.2018 Subject: Clarification regarding applicability of GST on the superior kerosene oil [SKO] retained for the manufacture of Linear Alkyl Benzene [LAB]. Briefly stated, references have been received related to applicability of GST on the superior kerosene oil [SKO] retained for the manufacture of Linear Alkyl Benzene [LAB]. 2. In this context, LAB manufacturers have stated that they receive superior Kerosene oil (SKO) from, a refinery, say, Indian Oil Corporation (IOC). They extract n-Paraffin (C9-C13 hydrocarbons) from SKO and retur

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Normal Paraffin, which is used in the manufacturing of LAB. In this transaction consideration is paid by LAB manufactures only on the quantity of retained SKO (n-paraffin). 4. In this context, the GST Council in its 22nd meeting held on 06.10.2017 discussed the issue and recommended for issuance of a clarification that in this transaction GST will be payable by the refinery on the value of net quantity of superior kerosene oil (SKO) retained for the manufacture of Linear Alkyl Benzene (LAB). 5. Accordingly, it is here by clarified that, in aforesaid case, GST will be payable by the refinery only on the net quantity of superior kerosene oil (SKO) retained for the manufacture of Linear Alkyl Benzene (LAB). Though, refinery would be liable to

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Procedure regarding procurement of supplies of goods from DTA by Export Oriented Unit (EOU) / Electronic Hardware Technology Park (EHTP) Unit / Software Technology Park (STP) Unit / Bio-Technology Parks (BTP) Unit under deemed export benefits under section 147 of CGST Act, 2017. – GST – States – 17/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 17/2018 (Circular No. 14/14/2017-GST) DATED: 17.09.2018 Subject: Procedure regarding procurement of supplies of goods from DTA by Export Oriented Unit (EOU) / Electronic Hardware Technology Park (EHTP) Unit / Software Technology Park (STP) Unit / Bio-Technology Parks (BTP) Unit under deemed export benefits under section 147 of CGST Act, 2017. In accordance with the decisions taken by the GST Council in its 22nd meeting held on 06.10.2017 at New Delhi to resolve certain difficulties being faced by exporters post- GST, it has been decided that supplies of

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appended herewith) bearing a running serial number containing the goods to be procured, as pre-approved by the Development Commissioner and the details of the supplier before such deemed export supplies are made. The said intimation shall be given to- (a) the registered supplier; (b) the jurisdictional GST officer in charge of such registered supplier; and (c) its jurisdictional GST officer. (ii) The registered supplier thereafter will supply goods under tax invoice to the recipient EOU / EHTP / STP / BTP unit. (iii) On receipt of such supplies, the EOU / EHTP / STP / BTP unit shall endorse the tax invoice and send a copy of the endorsed tax invoice to- (a) the registered supplier; (b) the jurisdictional GST officer in charge of such registered supplier; and (c) its jurisdictional GST officer. (iv) The endorsed tax invoice will be considered as proof of deemed export supplies by the registered person to EOU / EHTP / STP / BTP unit. (v) The recipient EOU / EHTP / STP / BTP unit shall ma

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o the terms and conditions to be adhered to by a EOU / EHTP / STP / BTP unit in terms of the Foreign Trade Policy, 2015- 20 and the duty exemption notification being availed by such unit. 4. Difficulty, if any, in implementation of the above instructions may please be brought to the notice of the Commissioner. 5. This Circular shall be deemed to have come into force with effect from 06.11.2017. Sd/- (Smaraki Mahapatra) Commissioner,State Tax, West Bengal Date: 18.09.2018 Memo. 377CT/PRO 3C/PRO/2018 Form- A (Intimation for procurement of supplies from the registered person by Export Oriented Unit (EOU)/Electronic Hardware Technology Park (EHTP) Unit/ Software Technology Park (STP) unit/ Bio-Technology Parks (BTP) Unit under deemed export benefits under section 147 of WBGST Act, 2017 read with Notification No. 1853-F.T.dated 18.10.2017 [48/2017- State Tax] (as per Circular – dated ) Running Sr. No. of intimation and Date_____________ LOP No. and valid upto . GSTIN We the, M/s …

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GST – States – 18/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 18/2018 (Circular No. 16/16/2017-GST) DATED: 17.09.2018 Subject: Clarifications regarding applicability of GST and availability of ITC in respect of certain services Various issues relating to applicability of GST and availability of ITC in respect of certain services have been received from the stake-holders. Accordingly, clarifications relating to applicability of GST and availability of ITC in respect of the following services are issued as under: S.No. Issue Comment 1. Is GST applicable on warehousing of agricultural produce such as tea (i.e. black tea, white tea etc.), processed coffee beans or powder, pulses (de-husked or split), jaggery, processed spices, processed dry fruits, processed cashew nuts etc.? 1. As per GST notification No. 1135-F.T.[11/2017-StateTax (Rate)], Sl.No. 24 and notification No. 1136-F.T.[12/2017-Stat

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ng, unloading, packing, storage or warehousing of agricultural produce. Same is the case with coffee obtained after processing of coffee beans. 5. Similarly, processing of sugarcane into jaggery changes its essential characteristics. Thus, jaggery is also not an agricultural produce. 6. Pulses commonly known as dal are obtained after dehusking or splitting or both. The process of de- husking or splitting is usually not carried out by farmers or at farm level but by the pulse millers. Therefore, pulses pulses (dehusked or split) are also not agricultural produce. However whole pulse grains such as whole gram, rajma etc. are covered in the definition of agricultural produce. 7. In view of the above, it is hereby clarified that processed products such as tea (i.e. black tea, white tea etc.), processed coffee beans or powder, pulses (dehusked or split), jaggery, processed spices, processed dry fruits, processed cashew nuts etc. fall outside the definition of agricultural produce given in n

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, notwithstanding that credit of input tax charged on consumption of such goods is not allowed for supply of service of transport of passengers by air in economy class at GST rate of 5%. 3. Is GST leviable on General Insurance policies provided by a State Government to employees of the State government/ Police personnel, employees of Electricity Department or students of colleges/private schools etc. (a) where premium is paid by State Government and (b) where premium is paid by employees, students etc.? It is hereby clarified that services provided to the Central Government, State Government, Union territory under any insurance scheme for which total premium is paid by the Central Government, State Government, Union territory are exempt from GST under Sl. No. 40 of notification No. 1136-F.T.[12/2017-StateTax (Rate)]. Further, services provided by State Government by way of general insurance (managed by government) to employees of the State government/ Police personnel, employees of Ele

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GST – States – 19/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 19/2018 (Circular No. 18/18/2017-GST) DATED: 17.09.2018 Subject: Clarification of unutilised input tax credit of GST paid on inputs in respect of exports of fabrics. Doubts have been raised regarding the restrictions of refund of unutilised input tax credit of GST paid on inputs to manufacturer exporters of fabrics [falling under chapters 50 to 55 and 60 and headings 5608, 5801, 5806] under GST. 2.1 The matter has been examined. In this context, sub-section (3) of section 54 of the WBGST Act, 2017 provides as under: (3) Subject to the provisions of sub-section (10), a registered perso

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section 54 of the WBGST Act, 2017, restricting refund of unutilised input tax credit of GST paid on inputs in respect of certain specified goods, including input tax credit of GST paid on inputs. 2.3 However, the aforesaid notification having been issued under clause (ii) of the proviso to sub-section (3) of section 54 of the WBGST Act, 2017, restriction on refund of unutilised input tax credit of GST paid on inputs will not be applicable to zero rated supplies, that is (a) exports of goods or services or both; or (b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit. 2.4 Accordingly, as regards export of fabrics it is clarified that, subject to the provisions of sub-section (10) of se

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GST – States – 21/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 21/2018 (Circular No. 20/20/2017-GST) DATED: 17.09.2018 Subject: Issue related to classification and GST rate on Terracotta idols. The GST rate on Idols made of clay is nil. (Sl. No. 135A of Schedule notification 1126-F.T. [2/2017 State Tax (Rate)] dated 28.06.2017). 2. In this connection, references have been received as to whether this e

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GST – States – 23/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 23/2018 (Circular No. 26/26/2017-GST) DATED: 17.09.2018 Subject: Filing of Returns under GST The GST Council, in its 23rdmeeting held at Guwahati on 10thNovember 2017, has taken certain decisions in regard to filing of returns by taxpayers. Subsequently, various representations have been received seeking clarifications on various aspects of return filing such as return filing dates, applicability and quantum of late fee, amendment of errors in submitting / filing of FORM GSTR-3B and other related queries. In order to consolidate the information in various notifications and circulars regarding return filing and to ensure uniformity in implementation across field formations (i.e., jurisdictional officers), the Commissioner, in exercise of its powers conferred under section 168 (1) of the West Bengal Goods and Services Tax Act, 2017

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/GST [58/2017-ST] both dated 15thNovember 2017) have been issued to notify the due dates for filing of outward supply statement in FORM GSTR-1 for various months / quarters (as depicted in the calendar above) by registered persons having aggregate turnover in the previous financial year or current financial year of upto1.5 Crores rupees and above 1.5 Crores rupees respectively. Since, the option of quarterly filing was not available earlier, many taxpayers have already filed their FORM GSTR-1 for the month of July, such taxpayers shall not file these details again and shall only file details for the month of August and September, 2017. For those, who have not filed their FORM GSTR-1 for the month of July, they shall also file their FORM GSTR-1 for the month of July separately and then file their FORM GSTR-1 on quarterly basis for the month of August and September, 2017. 1.3 It has been further decided that the time period of filing of FORM GSTR-2 and FORM GSTR -3 for the months of July

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RM GSTR-1 on monthly basis if he so wishes even though his aggregate turnover is up to ₹ 1.5 Crore. Once he falls in this bracket or if he chooses to file return on monthly basis, the registered person will not have the option to change the return filing periodicity for the entire financial year. In cases, where the registered person wrongly reports his aggregate turnover and opts to file FORM GSTR-1 on quarterly basis, he may be liable for punitive action under the WBGST Act, 2017. 2. Applicability and quantum of latefee: 2.1 The late fee for the months of July, August and September for late filing of FORM GSTR – 3B has already been waived off vide Notification No.1591-F.T.[28/2017-ST] dated 4th September, 2017 and 1888-F.T. [50/2017-CT] dated 24thOctober, 2017. 2.2 It has been decided that for subsequent months, i.e. October 2017 onwards, the amount of late fee payable, by a taxpayer whose tax liability for that month was NIL , will be ₹ 20/- per day (Rs. 10/- per day eac

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the system will automatically reconcile the data submitted in FORM GSTR-3B with FORM GSTR-1 and FORM GSTR-2, and the variations if any will either be offset against output tax liability or added to the output tax liability of the subsequent months of the registered person. 3.2 Since, the GST Council has decided that the time period of filing of FORM GSTR-2 and FORM GSTR -3 for the month of July 2017 to March 2018 would be worked out by a Committee of officers, the system based reconciliation prescribed under Trade Circular No. 09/2017 [7/7/2017-GST] dated 04.09.2017 can only be operationalized after the relevant notification is issued. The said circular is therefore kept in abeyance till such time. 3.3 The common errors while submitting FORM GSTR-3B and the steps needed to be taken to rectify the same are provided in the table annexed herewith. The registered person needs to decide at which stage of filing of FORM GSTR-3B he is currently at and also the error committed by him. The corr

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e information in FORM GSTR-3B, a provision for editing the same has been provided. The facility to edit the information can be used only before offsetting the liability and editing will not be permitted after offsetting the liability. Hence, every care should be taken to ensure the accuracy of the figures before proceeding to offset the liabilities. 6. It is further clarified that the information furnished by the registered person in the return in FORM GSTR-3B would be reconciled by the department s system with the information furnished in FORM GSTR-1 and discrepancies, if any, shall be dealt with in accordance with the relevant provisions of the WBGST Act, 2017 and rules made thereunder. Detailed instructions regarding reconciliation of information furnished in FORM GSTR-3B with that contained in FORM GSTR-2 and FORM GSTR-3 will be issued in due course of time. 7. Difficulty, if any, in implementation of the above instructions may please be brought to the notice of the Commissioner. 8

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creating challan in FORM GST PMT-06. Liability may be added in the return of subsequent month(s) after payment of Interest. Liability was under reported Company A has four units in Haryana, while filing their return for the month of July, they inadvertently, missed on details of a last minute order. Since, they had already submitted and confirmed their output supply details, they were not sure of how to proceed. What can they do? The company may use the edit return facility to add such liability in their submitted return and then proceed for filing of their return. Company A has four units in Haryana, while filing their return for the month of July, they inadvertently, missed on details of a last minute order. Since, they had already submitted and confirmed their output supply details, but were not sure of how to proceed. They added cash in the cash to the extent of their under reported liability. What can they do? The company may use the edit return facility to add such liability in t

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o the liability. No action was taken after this step. Cash was added to the electronic cash ledger as per the return liability. No action was taken after this step. All liabilities were offset by debiting the cash and credit ledger. No action was taken after this step. Return was filed. Use Edit facility to reduce over reported liability. Use Edit facility to reduce over reported liability and cash ledger may be partially debited to offset such liability. Remaining balance may either be claimed as refund or used to offset future liabilities. Liability may be adjusted in return of subsequent month(s) or refund may be claimed where adjustment is not feasible. Liability was over reported Company B had reported an inter-State sale but realized that the same sale was counted twice and hence was not to be reported. But the return form was already submitted and no change could be done to the liabilities. What can company B do? In this case, Company B has the option to use the "edit"

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is liability in the return of subsequent months or claim refund of the same. Common Error – III Stage 1 Stage 2 Stage 3 Stage 4 Confirmed Submission Cash Ledger Updated Offset Liability Return Filed Return liabilities / Input tax credit availed were confirmed and submitted and therefore no change can be done to the liability. No action was taken after this step. Cash was added to the electronic cash ledger as per the return liability. No action was taken after this step. All liabilities were offset by debiting the cash and credit ledger. No action was taken after this step. Return was filed. Use Edit facility to rectify wrongly reported liability Use Edit facility to rectify wrongly reported liability and cash ledger may be debited to offset new liability, where sufficient balances are not available in the credit ledger. Remaining balance, if any may be either claimed as refund or used to offset future liabilities. Unreported liability may be added in the next month s return with inter

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se, the company will have to rectify wrongly reported liability using the edit facility. The company will reduce their Central Tax / State tax liability and add integrated tax liability. Further, they will have to pay integrated tax and update their cash ledger. They may seek for Central Tax / State tax cash refund in due course or use the same for offsetting future liabilities. Company C was registered in the State of Haryana. While entering their outward supplies in FORM GSTR-3B, the company realized that they had inadvertently, shown inter-State supply as intra-State supply and submitted the return. The company paid their wrong liability and filed their return in order to avoid late fee and penalty? What can they do? Since, the return has already been filed, then the company will have to report the inter-State supply in their next month s liability and adjust their wrongly paid intra-State liability in the subsequent months returns or claim refund of the same. Change in FORM GSTR-1

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put tax credit was under reported Company D, while filing their FORM GSTR -3B for the month of July, inadvertently, misreported Input tax credit of Rs. They had confirmed and submitted their return. What can they do? The company may use the "edit" facility to add more Input tax credit to their submitted FORM GSTR-3B. once, this is done, such credit will be reflected in their Electronic Credit ledger and may be utilized to offset liabilities for this month or for subsequent months. No Action required in cash ledger Company D, while filing their FORM GSTR -3B for the month of July, inadvertently, misreported Input tax credit of Rs. as ₹ 10,00, 000/-. They had filed their return and paid Rs. in cash. What can they do? Since, the return has already been filed, Company D may add such Input tax credit in their return for subsequent month(s). Change in FORM GSTR-1 No Action Common Error – V Stage 1 Stage 2 Stage 3 Stage 4 Confirmed Submission Cash Ledger Updated Offset Liabili

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it but not used such credit for offsetting their liabilities, they can reduce their input tax credit by using the "edit" facility. While filing their FORM GSTR 3B for the months of July, 2017, Company E inadvertently, reported their eligible input tax credit, as ₹ 20,00,000/- instead of ₹ 10,00,000/-. What can they do? Since, the company has submitted details of their input tax credit but not used such credit for offsetting their liabilities, they can reduce their input tax credit by using the "edit" facility. Since, they have deposited ₹ 10,00,000/- only in their input tax credit ledger they may deposit additional ₹ 10,00,000/- in the cash ledger by creating challan in FORM GST PMT-06. While filing their FORM GSTR 3B for the months of July, 2017, Company E inadvertently, reported their eligible input tax credit, as ₹ 20,00,000/- instead of ₹ 10,00,000/-. Company E also utilized their additional input tax credit and filed their re

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put tax credit reduced will be adjusted in the credit ledger without any additional liability Additional cash, if required, may be deposited in the cash ledger by creating challan in FORM GST PMT-06 Pay(through cash) / Reverse any wrongly reported input tax credit in return of subsequent month(s). For under reported input tax credit, the same may be availed in return of subsequent month(s). Input Tax Credit of the wrong tax was taken While filing their FORM GSTR 3B for the months of July, 2017, Company E inadvertently, reported their Central Tax credit of ₹ 20,00,000/-as Integrated tax. What can they do? Use edit facility to claim correct central tax credit under the right head. While filing their FORM GSTR 3B for the months of July, 2017, Company E inadvertently, reported their Central Tax credit of ₹ 20,00,000/- as Integrated tax. What can they do? They can use edit facility to correct central tax credit under the right head. For offsetting any integrated tax liability, a

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ectly and thereafter confirmed and submitted. Therefore no change is required to be done to the liability. No action was taken after this step. Cash was added to the electronic cash ledger as per the return liability. No action was taken after this step All liabilities were offset by debiting the cash and credit ledger. No action was taken after this step Return was filed. No Action Add cash under the right tax head and seek cash refund of the cash added under the wrong tax head. No Action Cash ledger wrongly updated No Action While filing their FORM GSTR-3B return, Company F while generating payment challan added ₹ 5,00,000/- under the Central Tax head, while they wanted to deposit ₹ 5,00,000/- under the integrated tax head. What can they do? Since, they have already filed their challan, they will have to add ₹ 5,00,000/- in their integrated tax head and file their returns. Further, they may seek refund of ₹ 5,00,000/- from their cash ledger. No Action Change i

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GST – States – 24/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 24/2018 (Circular No. 27/01/2018-GST) DATED: 17.09.2018 Subject: Clarifications regarding levy of GST on accommodation services, betting and gambling in casinos, horse racing, admission to cinema, homestays, printing, legal services etc. Representations were received from trade and industry for clarification on certain issues regarding levy of GST on supply of services. 2. In this context, it is stated that the following clarifications, inter-alia, were published as FAQ at www.wbcomtax.gov.in S.No. Questions/ Clarifications sought Clarifications 1. 1. Will GST be charged on actual tariff or declared tariff for accommodation services? 2. What will be GST rate if cost goes up (more than declared tariff) owing to additional bed? 3. Where will the declared tariff be published? 4. Same room may have different tariff at different times

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eclared at different places, highest of such declared tariffs shall be the declared tariff for the purpose of levy of GST. 4. In case different tariff is declared for different seasons or periods of the year, the tariff declared for the season in which the service of accommodation is provided shall apply. 5. Declared tariff at the time of supply would apply. 6. If declared tariff of the accommodation provided by way of upgrade is ₹ 10000, but amount charged is ₹ 7000, then GST would be levied @ 28% on ₹ 7000/-. 2. Vide notification No. 1135-F.T.[11/2017-State Tax (Rate)] dated the 28th June 2017 entry 34, GST on the service of admission into casino under Heading 9996 (Recreational, cultural and sporting services) has been levied @ 28%. Since the Value of supply rule has not specified the method of determining taxable amount in casino, Casino Operators have been informed to collect 28% GST on gross amount collected as admission charge or entry fee. The method of levy a

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as services by way of supply of food/ drinks etc. at the casinos). Betting, in pre-GST regime, was subjected to betting tax on full bet value. 3. The provision in rate schedule notification No. 1135-F.T. [11/2017-State Tax (Rate)] dated the 28th June 2017 does not clearly state the tax base to levy GST on horse racing. This may be clarified. GST would be leviable on the entire bet value i.e. total of face value of any or all bets paid into the totalisator or placed with licensed book makers, as the case maybe. Illustration: If entire bet value is ₹ 100, GST leviable will be ₹ 28/-. 4. 1. Whether for the purpose of entries at Sl. Nos. 34(ii) [admission to cinema] and 7(ii)(vi)(viii) [Accommodation in hotels, inns, etc.], of notification 1135-F.T. [11/2017-State Tax (Rate)] dated 28th June 2017, price/ declared tariff includes the tax component or not? 2. Whether rent on rooms provided to in-patients is exempted? If liable to tax, please mention the entry of WBGST Notificatio

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on under section 22(1) of WBGST Act. Such persons, even though they provide services through ECO, are not required to take registration in view of section 24(ix) of WBGST Act, 2017. 6. To clarify whether supply in the situations listed below shall be treated as a supply of goods or supply of service: – 1. The books are printed/ published/ sold on procuring copyright from the author or his legal heir. [e.g. White Tiger Procures copyright from Ruskin Bond] 2. The books are printed/ published/ sold against a specific brand name. [e.g. Manorama Year Book] 3. The books are printed/ published/ sold on paying copyright fees to a foreign publisher for publishing Indian edition (same language) of foreign books. [e.g. Penguin (India) Ltd. pays fees to Routledge (London)] The books are printed/ published/ sold on paying copyright fees to a foreign publisher for publishing Indian language edition (translated). [e.g. Ananda Publishers Ltd. pays fees to Penguin(NY)]. The supply of books shall be tre

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GST – States – 25/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 25/2018 (Circular No. 29/03/2018-GST) DATED: 17.09.2018 Subject: Clarification regarding applicability of GST on Polybutylene feedstock and Liquefied Petroleum Gas retained for the manufacture of Poly Iso Butylene and Propylene or Di-butyl para Cresol. References have been received related to the applicability of GST on the Polybutylene feedstock and Liquefied Petroleum Gas retained for the manufacture of Poly Iso Butylene and Propylene or Di-butyl para Cresol. 2. In this context, manufacturers of Propylene or Di-butyl para Cresol and Poly Iso Butylene have stated that the principal r

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n stating that in such transactions, GST will be payable by the refinery on the value of net quantity of polybutylene feedstock and liquefied petroleum gas retained for the manufacture of Poly Iso Butylene and Propylene or Di-butyl Para Cresol. 4. Accordingly, it is hereby clarified that, in the aforesaid cases, GST will be payable by the refinery only on the net quantity of Polybutylene feedstock and Liquefied Petroleum Gas retained by the manufacturer for the manufacture of Poly Iso Butylene and Propylene or Di-butyl para Cresol. Though, the refinery would be liable to pay GST on such returned quantity of Polybutylene feedstock and Liquefied Petroleum Gas, when the same is supplied by it to any other person. 5. This clarification is issue

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GST – States – 27/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 27/2018 (Circular No. 32/06/2018-GST) DATED: 17.09.2018 Subject: Clarifications regarding GST in respect of certain services The GST Council during its 25th meeting held on 18thJanuary, 2018, discussed issues in respect of taxability of following services and decided to issue a clarification. According the following clarification relating to the following services is issued:- S. No. Issue Clarification 1. Is hostel accommodation provided by Trusts to students covered within the definition of Charitable Activities and thus, exempt under Sl. No. 1 of notification No. 1136-F.T. [12/2017-ST (Rate)]. Hostel accommodation services do not fall within the ambit of charitable activities as defined in para 2(r) of notification No. 1136-F.T. [12/2017-ST (Rate)]. However, services by a hotel, inn, guest house, club or campsite, by whatever n

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d. Services by any court or Tribunal established under any law for the time being in force is neither a supply of goods nor services. Consumer Disputes Redressal Commissions (National/ State/ District) may not be tribunals literally as they may not have been set up directly under Article 323B of the Constitution. However, they are clothed with the characteristics of a tribunal on account of the following: – (1) Statement of objects and reasons as mentioned in the Consumer Protection Bill state that one of its objects is to provide speedy and simple Redressal to consumer disputes, for which a quasi- judicial machinery is sought to be set up at District, State and Central levels. (2) The President of the District / State/ National Disputes Redressal Commissions is a person who has been or is qualified to be a District Judge, High Court Judge and Supreme Court Judge respectively. (3) These Commissions have been vested with the powers of a civil court under CPC for issuing summons, enforci

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al, cultural and sporting services) treating them as joy rides, leviable to GST@ 28%? Elephant / camel joy rides cannot be classified as transportation services. These services will attract GST @ 18% with threshold exemption being available to small service providers. [Sl. No 34(iii) of notification No. 1135-F.T. [11/2017-ST (Rate)] dated 28.06.2017 as amended by notification No. 129-F.T. [1/2018-ST(Rate)] dated 25.01.2018 refers] 4. What is the GST rate applicable on rental services of self-propelled access equipment (Boom Scissors/ Telehandlers)? The equipment is imported at GST rate of 28% and leased further in India where operator is supplied by the leasing company, diesel for working of machine is supplied by customer and transportation cost including loading and unloading is also paid by the customer. Leasing or rental services, with or without operator, for any purpose are taxed at the same rate of GST as applicable on supply of like goods involving transfer of title in goods. T

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refers]. (1) Services provided by senior doctors/ consultants/ technicians hired by the hospitals, whether employees or not, are healthcare services which are exempt. 5. Retention money: Hospitals charge the patients, say, ₹ 10000/- and pay to the consultants/ technicians only ₹ 7500/- and keep the balance for providing ancillary services which include nursing care, infrastructure facilities, paramedic care, emergency services, checking of temperature, weight, blood pressure etc. Will GST be applicable on such money retained by the hospitals? Health care services have been defined to mean any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India [para 2(zg) of notification No. 1136-F.T. [12/2017-ST (Rate)]. Therefore, hospitals also provide healthcare services. The entire amount charged by them from the patients including the retention money and the fee/payments made to the d

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are taxable. 6. Appropriate clarification may be issued regarding taxability of Cost Petroleum. As per the Production Sharing Contract (PSC) between the Government and the oil exploration & production contractors, in case of a commercial discovery of petroleum, the contractors are entitled to recover from the sale proceeds all expenses incurred in exploration, development, production and payment of royalty. Portion of the value of petroleum which the contractor is entitled to take in a year for recovery of these contract costs is called Cost Petroleum . The relationship of the oil exploration and production contractors with the Government is not that of partners but that of licensor/lessor and licensee/lessee in terms of the Petroleum and Natural Gas Rules, 1959. Having acquired the right to explore, exploit and sell petroleum in lieu of royalty and a share in profit petroleum, contractors carry out the exploration and petroleum for themselves and not as a service to the Governmen

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GST – States – 28/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 28/2018 (Circular No. 34/08/2018-GST) DATED: 17.09.2018 Subject: Clarifications regarding GST in respect of certain services I am directed to issue clarification with regard to the following issues as approved by the Fitment Committee to the GST Council in its meeting held on 9th, 10th and 13th January 2018: – S.No. Issue Clarification 1. Whether activity of bus body building, is a supply of goods or services? In the case of bus body building there is supply of goods and services. Thus, classification of this composite supply, as goods or service would depend on which supply is the pr

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ply of retreaded tyres, where the old tyres belong to the supplier of retreaded tyres, is a supply of goods (retreaded tyres under heading 4012 of the Customs Tariff attracting GST @ 28%) 3. (1) Whether the activities carried by DISCOMS against recovery of charges from consumers under State Electricity Act are exempt from GST? (2) Whether the guarantee provided by State Government to state owned companies against guarantee commission, is taxable under GST? 1. Service by way of transmission or distribution of electricity by an electricity transmission or distribution utility is exempt from GST under notification No. 1136-F.T. [12/2017- ST (R)], Sl. No. 25. The other services such as,- i. Application fee for releasing connection of electricit

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GST – States – 31/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 31/2018 (Circular No. 39/13/2018-GST) DATED: 17.09.2018 Subject: Setting up of an IT Grievance Redressal Mechanism to address the grievances of taxpayers due to technical glitches on GST Portal. It has been decided to put in place an IT-Grievance Redressal Mechanism to address the difficulties faced by a section of taxpayers owing to technical glitches on the GST portal and the relief that needs to be given to them. The relief could be in the nature of allowing filing of any Form or Return prescribed in law or amending any Form or Return already filed. The details of the said grievance redressal mechanism are provided below: 2. Introduction Where an IT related glitch has been identified as the reason for failure of a class of taxpayer in filing of a return or a form within the time limit prescribed in the law and there are collat

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tee. In GIC meetings convened to address IT issues or IT glitches, the CEO, GSTN and the DG (Systems), CBEC shall participate in these meetings as special invitees. 5. Nodal officers and identification of issues 5.1 GSTN, Central and State government would appoint nodal officers in requisite number to address the problem a taxpayer faces due to glitches, if any, in the Common Portal. This would be publicized adequately. 5.2 Taxpayers shall make an application to the field officers or the nodal officers where there was a demonstrable glitch on the Common Portal in relation to an identified issue, due to which the due process as envisaged in law could not be completed on the Common Portal. 5.3 Such an application shall enclose evidences as may be needed for an identified issue to establish bonafide attempt on the part of the taxpayer to comply with the due process of law. 5.4 These applications shall be collated by the nodal officer and forwarded to GSTN who would on receipt of applicati

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required to be waived. GST Council has delegated the power to the IT Grievance Redressal Committee to recommend waiver of fine or penalty, in case of an emergency, to the Government in terms of section 128 of the CGST/WBGST Act, 2017 under such mitigating circumstances as are identified by the committee. All such notifications waiving fine or penalty shall be placed before GST Council. 7.2 Where adequate time is available, the issue of waiver of fee and penalty shall be placed before the GST Council with recommendation of the IT-Grievance Redressal Committee. 8. Resolution of stuck TRAN-1s and filing of GSTR-3B 8.1 A large number of taxpayers could not complete the process of TRAN-1 filing either at the stage of original or revised filing as they could not digitally authenticate the TRAN-1s due to IT related glitches. As a result, a large number of such TRAN-1s are stuck in the system. GSTN shall identify such taxpayers who could not file TRAN-1 on the basis of electronic audit trail.

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e taxpayers shall complete the process of filing of TRAN 1 stuck due to IT glitches, as discussed above, by 30thApril 2018 and the process of completing filing of GSTR 3B which could not be filed for such TRAN 1 shall be completed by 31st May 2018. 9. The decisions of the Hon ble High Courts of Allahabad, Bombay etc., where no case specific decision has been taken, may be implemented in-line with the procedure prescribed above, subject to fulfilment of the conditions prescribed therein. Where these conditions are not satisfied, Hon ble Courts may be suitably informed and if needed review or appeal may be filed. 10. Trade may be suitably informed and difficulty if any in implementation of the circular may be brought to the notice of the Commissioner. 11. This circular shall be deemed to have come into force with effect from 03.04.2018. Sd/- (Smaraki Mahapatra) Commissioner, State Tax, West Bengal Date: 18.09.2018 Memo. 391 CT/PRO 3C/PRO/2018 – Circular – Trade Notice – Public Notice – I

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GST – States – 32/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 32/2018 (Circular No. 44/18/2018-GST) DATED: 17.09.2018 Subject: Issue related to taxability of tenancy rights under GST. Doubts have been raised as to,- (i) Whether transfer of tenancy rights to an incoming tenant, consideration for which is in form of tenancy premium, shall attract GST when stamp duty and registration charges is levied on the said premium, if yes what would be the applicable rate? (ii) Further, in case of transfer of tenancy rights, a part of the consideration for such transfer accrues to the outgoing tenant, whether such supplies will also attract GST? 2. The issue

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erties in Maharashtra are governed by Maharashtra Rent Control Act,1999. 3. As per section 9(1) of the WBGST Act there shall be levied State tax on the intra-State supplies of services. The scope of supply includes all forms of supply of goods and services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business and also includes the activities specified in Schedule II. The activity of transfer of tenancy right against consideration in the form of tenancy premium is a supply of service liable to GST. It is a form of lease or renting of property and such activity is specifically declared to be a service in para 2 of

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ttract levy of GST. 5. To sum up, the activity of transfer of tenancy rights is squarely covered under the scope of supply and taxable per-se. Transfer of tenancy rights to a new tenant against consideration in the form of tenancy premium is taxable. However, renting of residential dwelling for use as a residence is exempt [Sl. No. 12 of notification No. 1136-F.T. [12/2017-State Tax(Rate)]]. Hence, grant of tenancy rights in a residential dwelling for use as residence dwelling against tenancy premium or periodic rent or both is exempt. As regards services provided by outgoing tenant by way of surrendering the tenancy rights against consideration in the form of a portion of tenancy premium is liable to GST. 6. Difficulty if any, in the imple

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GST – States – 34/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 34/2018 (Circular No. 47/21/2018-GST) DATED: 10.09.2018 Subject: Clarifications of certain issues under GST like car servicing, keeping of books of accounts in case of auction of tea etc. Representations have been received seeking clarification on certain issues under the GST laws. The same have been examined and the clarifications on the same are as below: Sl.No. Issue Clarification 1. Whether moulds and dies owned by Original Equipment Manufacturers (OEM) that are sent free of cost (FOC) to a component manufacturer is leviable to tax and whether OEMs are required to reverse input tax credit in this case? 1.1 Moulds and dies owned by the original equipment manufacturer (OEM) which are provided to a component manufacturer (the two not being related persons or distinct persons) on FOC basis does not constitute a supply as there is

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ent manufacturer on FOC basis, the amortised cost of such moulds/dies shall be added to the value of the components. In such cases, the OEM will be required to reverse the credit availed on such moulds/ dies, as the same will not be considered to be provided by OEM to the component manufacturer in the course or furtherance of the former s business. 2. How is servicing of cars involving both supply of goods (spare parts) and services (labour), where the value of goods and services are shown separately, to be treated under GST? 2.1 The taxability of supply would have to be determined on a case to case basis looking at the facts and circumstances of each case. 2.2 Where a supply involves supply of both goods and services and the value of such goods and services supplied are shown separately, the goods and services would be liable to tax at the rates as applicable to such goods and services separately. 3. In case of auction of tea, coffee, rubber etc., whether the books of accounts are req

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books of accounts relating to each and every place of business in that place itself in terms of the first proviso to sub-section (1) of section 35 of the WBGST Act. However, in case difficulties are faced in maintaining the books of accounts, it is clarified that they may maintain the books of accounts relating to the additional place(s) of business at their principal place of business instead of such additional place(s). (c) The principal and the auctioneer for the purpose of auction of tea, coffee, rubber etc., or the principal and the auctioneer for the purpose of supply of tea through a private treaty, shall intimate their jurisdictional officer in writing about the maintenance of books of accounts relating to the additional place(s) of business at their principal place of business. 3.2 It is further clarified that the principal and the auctioneer for the purpose of auction of tea, coffee, rubber etc., or the principal and the auctioneer for the purpose of supply of tea through a

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GST – States – 35/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 35/2018 (Circular No. 48/22/2018-GST) DATED: 17.09.2018 Subject: Clarifications of certain issues under GST related to SEZ and refund of unutilized ITC for job workers. Representations have been received seeking clarification on certain issues under the GST laws. The same have been examined and the clarifications on the same are as below: Sl.No. Issue Clarification 1. Whether services of short-term accommodation, conferencing, banqueting etc. provided to a Special Economic Zone (SEZ) developer or a SEZ unit should be treated as an inter State supply (under section 7(5)(b) of the IGST Act, 2017) or an intra-State supply (under section 12(3)(c) of the IGST Act, 2017)? 1.1 As per section 7(5) (b) of the Integrated Goods and Services Tax Act, 2017 (IGST Act in short), the supply of goods or services or both to a SEZ developer or a SE

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ccommodation, conferencing, banqueting etc., provided to a SEZ developer or a SEZ unit shall be treated as an inter-State supply. 2. 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? 2.1 As per section 16(1) of the IGST Act, zero rated supplies means supplies of goods or services or both to a SEZ developer or a SEZ unit. Whereas, section 16(3) of the IGST Act provides for refund to a registered person making zero rated supplies under bond/LUT or on payment of integrated tax, subject to such conditions, safeguards and procedure as may be prescribed. Further, as per the second proviso to rule 89(1) of the West Bengal Goods and Services Tax Rules, 2017 (WBGST Rules in short), in respect of supplies to a SEZ developer or a SEZ unit, the application for refund shall be filed by the: (a) supplier of goods after such goods have been admitted in full

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shall be available in such cases to the supplier. 3. Whether independent fabric processors (job workers) in the textile sector supplying job work services are eligible for refund of unutilized input tax credit on account of inverted duty structure under section 54(3) of the WBGST Act, 2017, even if the goods (fabrics) supplied are covered under notification No. 1129-F.T. [05/2017-State Tax (Rate)], dated 28.06.2017? 3.1 Notification No. 1129-F.T. [05/2017-State Tax (Rate)], dated 28.06.2017 specifies the goods in respect of which refund of unutilized input tax credit (ITC) on account of inverted duty structure under section 54(3) of the WBGST Act shall not be allowed where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies of such goods. However, in case of fabric processors, the output supply is the supply of job work services and not of goods (fabrics). 3.2 Hence, it is clarified that the fabric processors shall be eli

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GST – States – 37/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 37/2018 (Circular No. 51/25/2018-GST) DATED: 17.09.2018 Subject: Applicability of GST on ambulance services provided to Government by private service providers under the National Health Mission (NHM) Your attention is invited to the Circular No. 210/2/2018- Service Tax, dated 30th May, 2018. The said Circular has been issued in the context of service tax exemption contained in notification No. 25/2012- Service Tax dated 20.06.2012 at SI. No. 2and 25(a). The Circular states, inter alia, that the service of transportation in ambulance provided by State Governments and private service providers (PSPs) to patients are exempt under notification No. 25/2012- Service Tax dated 20.06.2012 and that ambulance service provided by PSPs to State Governments under National Health Mission is a service provided to Government by way of public hea

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horized medical practitioner or para-medics; (b) services provided by way of transportation of a patient in an ambulance, other than those specified in (a)above. *** Sl. No. 25(a) Services provided to Government, a local authority or a governmental authority by way of water supply, public health, sanitation conservancy, solid waste management or slum improvement and upgradation Sl. No. 3 Pure services (excluding works contract service or other composite supplies involving supply of any goods) provided to the Central Government, State Government or Union territory or local authority or a Governmental authority or a Government Entity by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. Sl. No. 3A Composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent, of the value of the

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by Government and PSPs by way of transportation of patients in an ambulance is applicable for the purpose of GST also, as the said services are specifically exempt under notification No. 1136-F.T. [12/2017- ST (R)] dated 28.06.2017 vide SI. No. 74. 5. As regards the service provided by PSPs to the State Governments by way of Transportation of patients on behalf of the State Governments against consideration in the form of fee or otherwise charged from the State Government, it is clarified that the same would be exempt under- SI. No. 3 of notification No. 1136-F.T. [12/2017- ST (R)] dated 28.06.2017 if it is a pure service and not a composite supply involving supply of any goods, and SI.No.3A of notification No. 1136-F.T. [12/2017- ST (R)] dated 28.06.2017 if it is a composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent of the value of the said composite supply. 6. Difficulty if any, in the implementation of this circular may

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GST – States – 40/2018 – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 TRADE CIRCULAR No. 40/2018 (Circular No. 57/31/2018-GST) DATED: 17.09.2018 Subject: Scope of Principal-agent relationship in the context of Schedule I of the WBGST Act. In terms of Schedule I of the West Bengal Goods and Services Tax Act, 2017 (hereinafter referred to as the WBGST Act ), the supply of goods by an agent on behalf of the principal without consideration has been deemed to be a supply. In this connection, various representations have been received regarding the scope and ambit of the principal-agent relationship under GST. In order to clarify some of the issues and to ensure uniformity in the implementation of the provisions of the law across the field formations (i.e., jurisdictional officers), the Commissioner, in exercise of its powers conferred under section 168 (1) of the WBGST Act hereby clarifies the issues in the succeeding par

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emerge from the above definition of agent: a) the term agent‟ is defined in terms of the various activities being carried out by the person concerned in the principal-agent relationship; and b) the supply or receipt of goods or services has to be undertaken by the agent on behalf of the principal. From this, it can be deduced that the crucial component for covering a person within the ambit of the term agent under the WBGST Act is corresponding to the representative character identified in the definition of agent under the Indian Contract Act, 1872. 5. Further, the two limbs of any supply under GST are consideration and in the course or furtherance of business . Where the consideration is not extant in a transaction, such a transaction does not fall within the ambit of supply. But, in certain scenarios, as elucidated in Schedule I of the WBGST Act, the key element of consideration is not required to be present for treating certain activities as supply. One such activity which ha

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is supplying or receiving goods on behalf of the principal. Since in the commercial world, there are various factors that might influence this relationship, it would be more prudent that an objective criterion is used to determine whether a particular principal-agent relationship falls within the ambit of the said entry or not. Thus, the key ingredient for determining relationship under GST would be whether the invoice for the further supply of goods on behalf of the principal is being issued by the agent or not. Where the invoice for further supply is being issued by the agent in his name then, any provision of goods from the principal to the agent would fall within the fold of the said entry. However, it may be noted that in cases where the invoice is issued by the agent to the customer in the name of the principal, such agent shall not fall within the ambit of Schedule I of the WBGST Act. Similarly, where the goods being procured by the agent on behalf of the principal are invoiced

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any, appoints Mr. B (auctioneer) to auction certain goods. The auctioneer arranges for the auction and identifies the potential bidders. The highest bid is accepted and the goods are sold to the highest bidder by M/s XYZ. The invoice for the supply of the goods is issued by M/s XYZ to the successful bidder. In this scenario, the auctioneer is merely providing the auctioneering services with no role played in the supply of the goods. Even in this scenario, Mr. B is not an agent of M/s XYZ for the supply of goods in terms of Schedule I. Scenario 3 Mr. A, an artist, appoints M/s B (auctioneer) to auction his painting. M/s B arranges for the auction and identifies the potential bidders. The highest bid is accepted and the painting is sold to the highest bidder. The invoice for the supply of the painting is issued by M/s B on the behalf of Mr. A but in his own name and the painting is delivered to the successful bidder. In this scenario, M/s B is not merely providing auctioneering services,

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icultural produce on behalf of his principal, or facilitates buying and selling of agricultural produce on behalf of his principal and receives, by way of remuneration, a commission or percentage upon the amount involved in such transaction. In cases where the invoice is issued by Mr. B to the buyer, the former is an agent covered under Schedule I. However, in cases where the invoice is issued directly by Mr. A to the buyer, the commission agent (Mr. B) doesn t fall under the category of agent covered under Schedule I. 9. In scenario 1 and scenario 2, Mr. B shall not be liable to obtain registration in terms of clause (vii) of section 24 of the WBGST Act. He, however, would be liable for registration if his aggregate turnover of supply of taxable services exceeds the threshold specified in sub-section (1) of section 22 of the WBGST Act. In scenario 3, M/s B shall be liable for compulsory registration in terms of the clause (vii) of section 24 of the WBGST Act. In respect of commission

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GST – States – Corrigendum to Trade Circular No. 17/2017-GST – Dated:- 17-9-2018 – GOVERNMENT OF WEST BENGAL DIRECTORATE OF COMMERCIAL TAXES 14, BELIAGHATA ROAD, KOLKATA-700015 Subject: Corrigendum to Trade Circular No. 17/2017-GST dated 21stDecember 2017 Dated: 17.09.2018 Corrigendum In Para No. 4 of the said Trade Circular, for It is further clarified that this Circular is applicable to the supply of tea, coffee, rubber, etc where the auctioneer claims ITC in respect of the supply made to him

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M/s. Sri Krishna Chemical Industries Versus The Government of Tamil Nadu, Goods and Service Tax Network (GSTN) , Goods and Service Tax Council, The Nodal Officer for State GST – Joint Commissioner of GST (CT-1) , The Assistant Commissioner of GST (CT-3) – 2018 (9) TMI 1764 – MADRAS HIGH COURT – [2018] 59 G S.T.R. 54 (Mad) – Unable to upload Form GST TRAN–1 – Transitional credit – migration to GST Regime – Held that:- The fifth respondent is directed to forward the representation of the petitioner dated 30.07.2018 to the fourth respondent, being the Nodal Officer, within a period of one week from the date of receipt of a copy of this order – petition disposed off. – W.P.(MD)No.19462 of 2018 Dated:- 17-9-2018 – Mrs. J. Nisha Banu J. For the

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account of some technical glitches. 4. The learned Counsel for the petitioner submitted that the Central Board of Indirect Taxes (CBIC) and Customs, in order to redress the grievances faced by taxpayers owing to technical glitches on GST, has issued a circular in Circular No.39/13/2018-GST, dated 03.04.2018, based on which, Grievance Committee was constituted and Nodal Officers were also appointed to address the problems of taxpayers. 5. The learned Counsel for the petitioner further submitted that the petitioner has made a detailed representation, narrating all facts, dated 30.07.2018, before the jurisdictional assessing officer, namely, the fifth respondent herein, who has to forward the representation of the petitioner to the Nodal Offi

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2018 (10) TMI 210 – CESTAT NEW DELHI – TMI – Clandestine removal – proceedings were initiated against one M/s Diwan Industries, a partnership firm – Revenue’s stand is that since the proprietor of the present unit is a partner in M/s Diwan Industries and the arrears against the partnership firm can be recovered from the partners, the appropriation of the refund sanctioned to the proprietary unit is legal and proper.
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Held that:- A proprietary unit is an individual legal entity and any refunds due to the proprietary unit cannot be adjusted or appropriated towards the demand which may be pending recovery against an another independent legal entity, of which the proprietor of unit is a partner. It has to be kept in mind that the present proceeding are not recovery proceeding against the partnership firm so as to make the recoveries independently from the partners also.
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The dispute relates to the refund of the duty deposited by a proprietary unit and on success of their appeal

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of identical amount of ₹ 36 lakhs and demand to the tune of ₹ 75,444/- was confirmed against M/s Mahavir Industries along with imposition of penalty of identical amount. 2. The matter was taken up by both the assessees before Commissioner (Appeals), who confirmed the order in original impugned before him. On subsequent appeals filed before Tribunal, it is seen that both the assessees were directed to deposit a part amount, as a condition of hearing of their appeal in terms of the provisions of Section 35F. As M/s Diwan Industries did not deposit, their appeal was dismissed for default. 3. As far as the present appellant is concerned, they took up the matter before the Hon ble High Court of Delhi, by way of filing a writ petition which was rejected, and as a consequence, the appellant deposited the directed amount in question. On such deposit, their appeal was taken up for final disposal and vide Final Order No. 50135/2017 dated 6.1.2017, their appeal was allowed. 4. As a co

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d from the partners, the appropriation of the refund sanctioned to the proprietary unit is legal and proper. However, I find that there is no dispute about the fact that proceedings were initiated against M/s Mahavir Industries by treating the same as an individual manufacturer. On success of their appeal before Tribunal, such proprietary unit is admittedly entitled to the refund of the amount pre-deposited by them before the Tribunal. A proprietary unit is an individual legal entity and any refunds due to the proprietary unit cannot be adjusted or appropriated towards the demand which may be pending recovery against an another independent legal entity, of which the proprietor of unit is a partner. It has to be kept in mind that the present proceeding are not recovery proceeding against the partnership firm so as to make the recoveries independently from the partners also. The dispute relates to the refund of the duty deposited by a proprietary unit and on success of their appeal befor

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2018 (10) TMI 529 – CESTAT HYDERABAD – TMI – CENVAT Credit – applicability of rule 6(3) of CCR 2004 – iron ore fines gets generated during the course of manufacture which is a waste product but it has marketable value – Held that:- There is no dispute on the facts of the case that the demand is on reversal of CENVAT credit under rule 6(3) for the value of iron ore fines generated by the appellant during the process of manufacture of final products viz; Sponge iron – On the very same issue in the case of Maa Mangla Ispat Pvt. Ltd. [2013 (5) TMI 268 – CESTAT NEW DELHI], the Principal Bench of CESTAT has decided that Rule 6(3) of CCR 2004 does not apply because iron ore fines are not manufactured let alone being exempted – the first appellate authority has not considered this aspect at all.
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during the audit, it was found that the amount of credit which the appellant has reversed was not correct and it was recalculated and an additional amount of about ₹ 11.00 lakhs was also required to be reversed. Appellant was served a show cause notice accordingly, proposing to recover the amount along with interest. It was also proposed to impose penalty upon the appellant. After the issue of show cause notice, appellant reversed the demanded amount along with interest. The original authority had confirmed the demand as proposed in the show cause notice and appropriated the amount already paid by the appellant. He also imposed a penalty equivalent to the amount of CENVAT credit availed by the appellant. Aggrieved, the appellant filed an appeal before the first appellate authority which was dismissed and the Order-in-Original was upheld. Hence this appeal. 4. Ld. Counsel for the appellant submits that they had contested the demand both on merits as well as on limitation before t

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tended period of limitation cannot be sustained. However, in the findings, the first appellate authority has only considered the aspect of imposition of penalty and has not examined the contention of the appellant on merits that they were not required to reverse duty under Rule 6(3) on the value of iron ore fine generated by them. 5. Ld. DR does not dispute the facts of the case but he points out that appellant had nowhere contested before the original authority about their liability to reverse the CENVAT credit under rule 6(3) proportionate value of iron ore fine. Although the appellant had contested this point before the first appellate authority, he has not recorded any findings on this aspect. He therefore pleaded that the matter may be remanded back to the first appellate authority for consideration on this issue. 6. I have considered the arguments of both sides. There is no dispute on the facts of the case that the demand is on reversal of CENVAT credit under rule 6(3) for the va

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2018 (10) TMI 1072 – CESTAT MUMBAI – TMI – Construction of residential complex service – non-payment of service tax – penalty – Held that:- Undisputedly, the appellant had though rendered taxable services under the category of construction of residential complex service during the relevant period 1.7.2010 to 30.6.2012, but failed to discharge appropriate service tax in time and also failed to furnish periodical ST-3 returns indicating the amount of taxable value received against the said service. Thus the fact of rendition of taxable service as well as value of service had been suppressed from the knowledge of the department – penalty u/s 78 upheld – however, benefit of reduced penalty is to be provided.
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Liability of service tax of ₹ 1,33,477/ Held that:- Even though the appellant have been claiming that the value against which the said amount of service tax demanded represents loans received from various persons, wrong entry and thereafter correction in their books of acc

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2 amounting to ₹ 8,27,234/- and short payment of service tax of ₹ 1,33,477/- for the relevant period. On adjudication, the demand was confirmed with interest and equal amount of penalty. Aggrieved by the said order, the appellant filed an appeal before the learned Commissioner (Appeals) who, in turn, rejected their appeal. Hence the present appeal. 3. Learned Chartered Accountant for the appellant has submitted that due to confusion in the levy of service tax on construction of residential complex services during the period 1.7.2010 to 30.6.2012, initially they have not paid the service tax nor filed any returns with the Department. He submits that on their own, before issuance of the show cause notice, the entire amount of service tax of ₹ 8,27,234/- along with interest of ₹ 1,54,093/- had been disbursed by them. It is his contention that therefore imposition of penalty equal to the amount of service tax under Section 78 of the Finance Act, 1994 is unwarranted

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s). 5. I find that undisputedly, the appellant had though rendered taxable services under the category of construction of residential complex service during the relevant period 1.7.2010 to 30.6.2012, but failed to discharge appropriate service tax in time and also failed to furnish periodical ST-3 returns indicating the amount of taxable value received against the said service. Thus the fact of rendition of taxable service as well as value of service had been suppressed from the knowledge of the department. Accordingly, imposition of penalty under Section 78 for non-payment of service tax of ₹ 8,27,234/- has been rightly confirmed by the authorities below. However, I find that both the authorities below have not extended the benefit of discharging 25% of the penalty subject to fulfilment of the conditions laid down under Section 78 of the Finance Act, 1994. As far as liability of service tax of ₹ 1,33,477/- is concerned, I find that even though the appellant have been claim

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REGARDING PENDING GSTIN CANCELLATIONS. – GST – States – Circular No. 1819043/593 – Dated:- 17-9-2018 Circular – Trade Notice – Public Notice – Instructions – Office orders

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