Author: admin_gst

Blue Dart Aviation Ltd. Versus Commissioner of Service Tax, Chennai, CGST & Central Excise, Chennai
Service Tax
2018 (9) TMI 1721 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 10-7-2018
ST/186/2011, ST/51/2012, ST/40420/2014, ST/41146/2014, ST/41211/2016, ST/41212/2016, ST/41244/2018, ST/41245/2018 – FINAL ORDER No. 42278-42285/2018
Service Tax
Shri Madhu Mohan Damodhar, Member (Technical) And Shri P. Dinesha, Member (Judicial)
Shri N. Venkatraman, Sr. Advocate, Shri Akil Suresh, Advocate For the Appellant
Shri K. Veerabhadra Reddy, JC (AR) For the Respondent
ORDER
Per Madhu Mohan Damodhar
The appellants are engaged in transportation of goods through Air. They are providing service mainly to their associate company, M/s.Blue Dart Express Ltd. (hereinafter referred to as BDL) for ferrying cargo and documents to different parts of the country. Appellants acquired on lease, aircraft from foreign company for transportation of cargo. The aircraft is operate

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ppeared that appellants have wrongly taken credit in respect of excise duty paid on motor vehicles amounting to Rs. 4,92,474/-. Accordingly a show cause notice dt. 22.06.2009 was issued to appellants, inter alia proposing demand of the said tax amount with interest thereon and also imposition of penalties under various provisions of law.
2.4. Another SCN dt. 12.04.2010 was issued proposing demand of service tax liability of Rs. 4,61,47,535/- with interest thereon for the subsequent period November 2008 to September 2009 in respect of alleged “Supply of Tangible Goods Service” received by appellants with respect to lease of the aircraft from foreign lessor and imposition of penalties.
2.5. On the same issue, subsequent SCN dt. 14.09.2010 proposed demand of service tax liability of Rs. 2,01,16,640/- with interest for the period July 2009 to September 2010 on supply of „Tangible Goods Service‟.
2.6 Yet another SCN dt. 29.08.2011 was issued on the very same issue, inter alia

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icle, under the CENVAT Credit Rules, 2004
No
Appeal No.ST/26/2011
November 2008 to September 2009
4,61,47,535
Rs.200 per day or 2% of the service tax demand per month whichever is higher subject to maximum of service tax payable, under Section 76
Supply of tangible goods
No
July 2009 to February 2010
2,01,16,640
Supply of tangible goods
No
Appeal No.ST/40420/2014
April 2010 to March 2011
1,88,99,721
Rs.200 per day or 2% of the service tax demand per month whichever is higher subject to maximum of service tax payable, under Section 76
Supply of tangible goods
No
Appeal No.ST/41146/2014
April 2011 to March 2012
7,10,77,525
Rs.200 per day or 2% of the service tax demand per month whichever is higher subject to maximum of service tax payable for period 1 April 2011 to 7 April 2011, under Section 76
Supply of tangible goods
No
–
Rs.100 per day or 1% of the service tax demand per month whichever is higher subject to maximum of service tax payable for period 8 April 2

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h the agreements to emphasize that as per para-5 of Article 3, the basic rent was required to be paid monthly in arrears. As per Article 5, the possession and control of the aircraft was at all times with the appellant as lessee. Appellant was also required to service, repair, maintain etc. the aircraft at their own cost. The agreement also required the appellant to cause aircrafts to be duly registered in India. As per Article 6, appellant was only required to replace all parts which have become unserviceable, louse lost, stolen etc. at their own cost and expenses. In these circumstances, as the effective possession and control of the aircraft was with the appellant at all times. The transaction could not have been brought within the fold of “Supply of Tangible Goods Service” performed by the foreign lessor.
3.2 Further, the scope of levy of service tax under the category of “Supply of Tangible Goods Service” has also been clarified by the Board in their Circular No.334/1/2008-TRU dt

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s purchased by them. In fact during the same period, appellants had purchased three motor cars on which no cenvat credit was availed by them. There was no malafide intention on their part and hence imposed penalty under Section 78 is unjustified and it is prayed that the same may be set aside.
3.5 With respect to liability to pay service tax on TDS amount a demand of Rs. 27,37,927/- has been confirmed. In this regard, the adjudicating authority concerned has accepted their plea in adjudication that actual liability works out only to Rs. 2,71,106/- together with interest of Rs. 41,886/- which is already paid up by them. However, the adjudicating authority has imposed penalty of Rs. 2,71,106/- under Section 78 of the Act. It is contended that there was considerable confusion on the taxability in respect of inclusability of TDS amount in the value of taxable service. Appellant had not discharged tax liability of Rs. 2,71,106/- only on the bonafide belief that the TDS amount is not requir

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ere the adjudicating authority has found that the aircraft is not owned by the lessor that originally belongs to Boeing Capital Corporation (BCC) who as the head lessor has given operational control and possession of the aircraft under a separate lease agreement dt.5.5.2002 to European Air Transport (EAT) for further use. Hence the ownership and title of the aircraft vests with the said BCC and not with the foreign lessor who have now leased their aircraft to the appellants. Therefore, it cannot be said that foreign lessor has vested possession and control to the appellant. He also draws our attention to paras 14 & 15 of the same impugned order wherein the adjudicating authority has correctly found that exclusion of TDS amounts from taxable income and utilization of ineligible cenvat credit on motor vehicles had been suppressed from the department with intent to evade demand of service tax liability and penalty under applicable provisions were very much imposable on the appellant.
5.

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etc. without prior consent of BCC. At the same time, it is also provided that if the EAT seeks consent from BCC for such a provision, such consent should not unreasonably be withheld or delayed provided that such sublease shall be expressly made subject and subordinate to the lease between BCC and EAT. Further, BCC have also been permitted to “wet lease” the aircraft in the ordinary course of EAT‟s business. Obviously, EAT was fully permitted and well within their rights to further lease the aircrafts to the appellant. Operating Lease agreement between EAT and the appellant dt. 27.02.2006 is for the same Boeing Model 756-236 Aircraft Sl.No. 24102. In fact, the very same conditions that were agreed upon between BCC and EAT have been reiterated in Article 5 of the agreement between EAT and the appellant.
8.1 Taking into account these aspects and also the other terms of agreement brought to our attention by the Ld. Sr.Advocate, in particular, the operation of the aircraft with the

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n our opinion, the controversy in these appeals is in a narrow compass, namely, whether the transaction entered into by the appellants with the hirers of DG sets would be in the nature of a transaction involving transfer of possession and control of goods to the users or is only one that allows the other users to use the goods without giving legal right of possession and effective control. If the transaction falls in the first category, that would be considered as deemed sale of goods and exigible to sales tax/VAT. However in case it is the latter, the transaction would then be treated as a service attracting levy of service tax under Finance Act, 1994.
6.2) Taxable service of supply of tangible goods serviceshas been defined under section 65(105)(zzzz) of the Finance Act, 1994 as any service provided or to be provided to any person, by any other person in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possessi

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.3) After 1.7.2012, consequent to change in service tax law, all services exempted any activity carried out by any person for consideration including a declared service, was made liable to service tax levy except certain activities which were specifically exempted or excluded from taxation. One such exclusion from service tax levy as per Section 65(B)(44) is an activity which constitutes merely (i) a transfer of title in goods or immovable property by way of sale, gift or in any other manner or (ii) such transfer, delivery or supply of any goods which is deemed to be a sale within the meaning of clause (29A) of Article 366 of the constitution or (iii) a transfer in money or actionable claim. At this stage, it will be useful to refresh ourselves with the said clause 29(A) of Article 366 of the Constitution which reads as follows:
(29A) tax on the sale or purchase of goods includes
(a) a tax on the transfer, otherwise than in pursuance of a contact, of property in any goods for cash, d

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hose goods by the person making the transfer, delivery or supply and a purchase of those goods by the person to whom such transfer, delivery or supply is made;
6.4) Thus, both before and after 01-07-2012, it can be reasonably concluded that supply of tangible goods inter-alia with the right to use then for any purpose and which transaction is deemed as a sale will attract only sales tax levy. However, where such supply does not extend to transfer of possession and effective control of overall goods, such a transaction would not become a deemed sale but a service. This is exactly what CBEC had clarified in their circular No. 334/1/2012-TRU, dated 16.03.2012, in para 2.5.8 as follows:
2.5.8 What is the meaning of transfer of the right to use any goods?
Transfer of right to use goods is a well recognized constitutional and legal concept. Every transfer of goods on lease, license or hiring basis does not result in transfer of right to use goods. Transfer of right of goodsinvolves transf

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s or licenses required therefore should be available to the transferee;
– For the period during which the transferee has such legal right, it has to be the exclusion to the transferor this is the necessary concomitant of the plain language 91 of the statute, viz., a transfer of the right to use and not merely a license to use the goods;
– Having transferred, the owner cannot again transfer the same right to others. It was also advised that whether a transaction amounts to transfer of right or not cannot be determined with reference to a particular word or clause in the agreement. The agreement has to be read as a whole, to determine the nature of the transaction.
In para 6.6.2, CBEC gave examples of transactions to clarify whether such transactions involve transfer of right to use or otherwise. However, it was also advised therein that the list was only illustrative of how Courts have interpreted terms and conditions of various types of contracts, to see if a transaction involves tr

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irrespective of the fact the machine is operated or kept on stand-by for 30 days or less in a month.
ii) The agreements laid down that APVAT @ 14.5% on such charges would be charged extra and as per section 4 (8) of APVAT Act.
iii) Certain safety measures were laid down by appellant to be provided or taken care of by the hirer at the time of installation of DG set and at the site operation. These include provision of concrete level flooring, minimum of three independent earth pits, supply of change over switch, provision of fire extinguishers at site, damages caused by mishandling be borne by hirer, not permitting unauthorised persons to run DG sets etc.
iv) With regard to ownership, it was laid out in the agreement that DG set is a sole property of the appellant, that transaction is purely on hire basis; that DG set is hired out to the hirer for his own use only and subletting is not allowed; DG set has to be returned in good condition to the owner upon termination of the agreement

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t, the agreements clearly lay down that the lessee shall render/operate the DG set for his exclusive use and that lessor has transferred the right to use the DG set. It is also not in dispute that as long as goods are with the hirer, appellants do not have any legal right to use the goods themselves. It is also not in dispute that appellants have transferred the right only to one hirer at a time.
6.9) With this background, we are unable to fathom how the adjudicating authority has concluded that effective possession and control of the impugned DG sets remains with the appellants and not with the hirers. The authority has held that since hirer is not permitted to run the DG set in the absence of technician provided by the appellant, the hirer is not free to use the DG set and that this indicates control of the appellant over the DG set. He has also found fault with the condition that power should not be withdrawn more than 72% of 288 KV/ 500 Amps at 8 PF on standard load 40% – 60% etc.

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consumables like HSD, lubrication oil only that recommended by the manufacturer is to be used, this indicates restrictions on the use of lubricating oil. On the other hand, appellants have pointed out that this clause is only the requirement stipulated by the manufacturer and if wrong oil is used it can damage DG set; that further the very fact that all consumables like HSD/lubricant oil have to be supplied by the hirer itself indicates that the hirers would use the equipments as per their own needs only and hence they have full control on the usage of the DG sets. Adjudicating authority has pointed out few other aspects of the agreements which, according to him, also prove that hirer does not have effective control. However, we find that these are only standard clauses on any lease agreements where hire charges are fixed, payment of freight by hirer, subletting of DG set is barred etc.
6.10) The agreements therefore only set out the terms of the hire and in no way put any shackles o

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rtment dated 31.03.2005 and G.O.Ms.No. 490, Revenue (CT-II), Dept. Dated 27.08.2005 and in G.O.Ms.No. 1615, Revenue (CT-II), Dept. Dated 31.08.2005 and the ruling is given as under:
VI. As per subsection (8) of Section 4 of APVAT Act, every VAT dealer who transfers the right to use goods taxable under the Act is liable to pay a tax for such goods at the rate specified in the schedules on the total amount realized or realizable on such transfer of right to use goods.
As seen from the agreement between the owner and the hirer clause (2) of Terms and conditions it is clearly mentioned that APGST @ 8% of the invoice amount will be charged extra as per Sec. 5E of APGST Act. VAT will be applicable w.e.f. 1.4.2005. Any other taxes or levies imposed by any of the State or Central authorities will be to the hirers account with retrospective effect.
Further in the preamble of the agreement, it is clearly mentioned that the Lesser (owner) is carrying on the business of leasing of power generat

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fer of both possession and control of the goods to the users of the goods. These transactions have been ruled as deemed sale of goods for the purpose of APVAT Act by the concerned Advance Ruling Authority. Appellants have also been discharging VAT on the hire charges under APVAT Act. Hence, this is the case of supply of tangible goods for use, with legal right of possession and effective control vesting with the hirer, required to be treated as deemed sale of goods, hence cannot be considered as supply of tangible goods for use of service for the purposes of Section 65(105) (zzzz) of the Finance Act, 1994 for the period upto 01-07-2012 or as taxable service for the purpose of Section 65B (44) of the Finance Act, 1994 after 01-07-2012.
7) In arriving at these conclusions, we draw sustenance from the ratio of the following case laws of higher Appellate Forums:
i) In the case of Bharat Sanchar Nigam Ltd [2006(2)STR 161 (SC), which has also been referred to by CBEC in the TAXATION OF SE

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s:
30. From the judicial decisions, the settled essential requirement of a transaction for transfer of the right to use goods are : (i) it is not the transfer of the property in goods, but it is the right to use property in goods; (ii) Article 366 (29-A)(d) read with the latter part of the clause (29-A) which uses the words, and such transfer, delivery or supply would show that the tax is not on the delivery of the goods used, but on the transfer of the right to use goods regardless of when or whether the goods are delivered for use subject to the condition that the goods should be in existence for use; (iii) in the transaction for the transfer of the right to use goods, delivery of goods is not a condition precedent, but the delivery of goods may be one of the elements of the transaction; (iv) the effective or general control does not mean always physical control and, even if the manner, method, modalities and the time of the use of goods is decided by the lessee or the customer, it

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it cannot be said that there is no right to use by the lessee. Such a view of the revenue does not appear to be tenable when we read carefully the provisions of the agreement. Cl. 13 of the agreement provides for Hirers Covenants. As per Cl. 13.1, the hirer will use the equipment only for the purpose it is hired and shall not misuse or abuse the equipment. Similarly in Cl. 13.3, it is provided that the hirer will ensure the safe custody of the equipment by providing necessary security, parking bay, etc., and will be responsible for any loss or damage or destruction. Cl. 13.5 provides that the hirer shall be solely responsible and liable to handle any dispute entered with any third party in relation to the use and operation of the equipment. Further Cl. 14 dealing with title and ownership specifically provides that equipment is offered by GMMCO Ltd. only on rights to use basis. Cl. 15 relating to damages provides for compensation to be paid by the hirer to the assessee in case of damage

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y of giving various equipments on hire does not fall under the category of Supply of tangible goods for use, hence the same is not liable to service tax w.e.f. 16.05.2008. Now coming to the Revenues appeal, we find that the Ld. Commissioner dropped the demand for the period prior to 16.05.2008 mainly on the ground that the service is of Supply of tangible goods for use which came into effect on 16.05.2008, therefore prior to that date the service was not taxable. However, we, in our above findings, held that the service in question is not the service of Supply of tangible goods for use. In this position the main ground of the Ld. Commissioner for dropping of demand does not exist and not relevant. Though the Ld. Commissioner in a passing reference mentioned in the impugned order that the service prior to 16.05.2008 does not fall under the Business Auxiliary Service but not given the detailed findings. Therefore when the main ground for dropping of demand does not exist. The issue relat

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Draft proposals for amending GST Laws for comments of the stakeholders till 15.07.2018
GST
Dated:- 9-7-2018

Sl. No.
Section/Sub-section/Clause
Amendments as shown in Red and Strikethrough
Rationale/Remarks
CGST Act, 2017
Definitions
1.
2 (4)
2 (4) “adjudicating authority” means any authority, appointed or authorised to pass any order or decision under this Act, but does not include the Central Board of Excise Indirect Taxes and Customs, the Revisional Authority, the Authority for Advance Ruling, the Appellate Authority for Advance Ruling, the Appellate Authority, and the Appellate Tribunal and the Authority referred to in sub-section (2) of section 171;
This is in pursuance of the change in name of the Central Board of Excise and Customs to the Central Board of Indirect Taxes and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963).
Further, the National AntiProfiteering Authority constituted by the Central Government under section 1

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this article, the President is empowered to establish a separate Board to ensure equitable distribution of funds in the State's budget to meet the developmental needs of the region. It is being added now based on the request received from the State of Karnataka.
5.
2 (102)
(102) “services” means anything other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged;
Explanation-For the removal of doubts, it is hereby clarified that the expression “services” includes facilitating or arranging transactions in securities.
Although 'securities' has been excluded from the definition of 'goods' and 'services' in the CGST Act, facilitating or arranging transactions in securities is liable to GST. This has been clarified recently through a detailed FAQ on Banking and Insurance wherein

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es or transactions, when constituting a supply in accordance with the provisions of sub-section (1), shall be treated either as supply of goods or supply of services as referred to in Schedule II.
(2) Notwithstanding anything contained in sub-section (1),
(a) activities or transactions specified in Schedule III; or
(b) such activities or transactions undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendations of the Council,
shall be treated neither as a supply of goods nor a supply of services.
(3) Subject to the provisions of sub-sections (1), (1A) and (2), the Government may, on the recommendations of the Council, specify, by notification, the transactions that are to be treated as-
(a) a supply of goods and not as a supply of services; or
(b) a supply of services and not as a supply of goods.
Classification of certain specified activities or

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tivities is taxed when received from a related person or from any of their establishments outside India.
8.
Schedule III, new insertion
7. Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into the taxable territory
It is sought to exclude from the tax net such transactions which involve movement of goods, caused by a registered person, from one non-taxable territory to another non-taxable territory
9.
Schedule III, new insertion
8 (a) Supply of warehoused goods to any person before clearance for home consumption.
(b) Supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India but before clearance for home consumption.
Explanation.- For the purposes of this clause, the expression “warehoused goods” shall have the meaning as assigned to it in the Customs Act, 1962

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such person on reverse charge basis as the recipient and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both.
9 (4) The Government may, on the recommendations of the Council, by notification, specify a class of registered persons who shall, in respect of taxable goods or services or both received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both
Section 9 (4), which mandates that all registered persons shall pay the tax on reverse charge basis on purchases made from unregistered persons, is presently under suspension. This sub-section is being omitted for trade facilitation.
Instead, it is proposed to take an enabling power for

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y in case of other suppliers,
subject to such conditions and restrictions as may be prescribed:
Provided that the Government may, by notification, increase the said limit of fifty lakh rupees to such higher amount, not exceeding one hundred and fifty lakh crore rupees, as may be recommended by the Council.
Provided further that a person who opts to pay tax under clause (a), clause (b) or clause (c) may supply services of value not exceeding ten percent of turnover in the preceding financial year in a State or Union territory or five lakh rupees, whichever is higher.
(2) The registered person shall be eligible to opt under sub-section (1), if-
(a) he is not engaged in the supply of services, other than supplies referred to in clause (b) of paragraph (6) of Schedule II save as provided in sub-section (1);
(b) he is not engaged in making any supply of goods which are not leviable to tax under this Act;
(c) he is not engaged in making any inter-State outward supplies of goods;
(d)

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by the GST Council.
At present, registered persons engaged in the supply of services (other than restaurant services) are not eligible for composition scheme. As a result, manufacturers and traders supplying services are unable to opt for the scheme even if its percentage is very small as compared to the supplies of goods. With a view to enable these taxpayers to avail of the benefit of composition scheme, a new proviso is being added in order to allow them to be eligible for the scheme even if they supply services of value not exceeding 10% of the turnover in the preceding financial year in a State/Union territory or ₹ 5 lakhs, whichever is higher.
This is a taxpayer-friendly measure and it is believed that small taxpayers would immensely benefit from this amendment.
This is a consequential amendment, as a new proviso is being added to section 10 (1) which allows the registered person to opt for the scheme even if they supply services of value not exceeding 10% of the turno

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f section 31 or the date of receipt of payment, whichever is earlier;
The amendment seeks to correct a drafting error as the provisions for issuance of invoices/other documents are also contained in other sub-sections of section 31.
Input Tax Credit
14.
16 (2) (b)
16 (2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless,
(a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribed;
(b) he has received the goods or services or both.
Explanation.- For the purposes of this clause, it shall be deemed that the registered person has received the goods or, as the case may be, services,-
(i) where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwi

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Subject to the provisions of section 41, the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilisation of input tax credit admissible in respect of the said supply; and
(d) he has furnished the return under section 39:
Provided that :
Provided further that where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his output tax liability, along with interest thereon, in such manner as may be prescribed:
It is proposed to remove the liability to pay interest in case where the recipient has been made liable to pay an amount equal to the ITC availed in case he fails to pay to the supplie

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n sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building) by excluding it from the ambit of 'exempt supply' on which ITC is blocked.
The proposed amendment is a taxpayer friendly measure.
17.
17 (5) (a), new (aa) & (b)
17(5) Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax credit shall not be available in respect of the following, namely:-
(a) motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), vessels and aircraft and other conveyances except when they are used
(i) for making the following taxable supplies, namely:-
(A) further supply of such vehicles or ; vessels or aircraft conveyances; or
(B) transportation of passengers; or
(C) imparting training on driving, flying, navigating such vehicles, vessels or aircraft or conveyances;
(ii) for transportation of goods;
and
(iii) for transportatio

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ment notifies the services which are obligatory for an employer to provide to its employees under any law for the time being in force; or
(B) such inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as part of a taxable composite or mixed supply; and
(iii) travel benefits extended to employees on vacation such as leave or home travel concession:
Provided that the input tax credit in respect of such goods or services or both shall be available, where the provision of such goods or services or both is obligatory for an employer to provide to its employees under any law for the time being in force.
It is proposed to expand the scope of ITC availability in case of motor vehicles having approved capacity of not more than 13 persons (including the driver) in case it is used for specified purposes.
The amendment is sought to make it clear that input tax

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nce with the provisions of section 17(5)(b), ITC is not available in respect of food and beverages, health services, travel benefits to employees etc. This sub-section is being amended to allow ITC in respect of such goods or services or both where the provision of such goods or services or both is obligatory for an employer to provide to its employees under any law for the time being in force.
This is a taxpayer-friendly amendment.
18.
20, Explanation (c)
Clause (c) of Explanation to section 20:
(c) the term ''turnover'', in relation to any registered person engaged in the supply of taxable goods as well as goods not taxable under this Act, means the value of turnover, reduced by the amount of any duty or tax levied under entry entries 84 and 92A of List I of the Seventh Schedule to the Constitution and entries 51 and 54 of List II of the said Schedule.
It is proposed to exclude the amount of tax levied under entry 92A of List I from the value of turnover for the purposes of di

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to correct this inadvertent omission.
Registration
19.
22 Explanation
Explanation (iii) to section 22 the expression “special category States” shall mean the States as specified in sub-clause (g) of clause (4) of article 279A of the Constitution except the State of Jammu and Kashmir and Assam.
The State of Assam has requested that the threshold exemption for registration in their State should be raised from ₹ 10 lakhs to ₹ 20 lakhs
20.
24 (x)
24 (x) every electronic commerce operator who is required to collect tax at source under section 52;
An e-commerce operator is presently required to take compulsory registration in terms of section 24(x) even if his aggregate turnover in a financial year does not exceed ₹ 20 lakhs. Clause (x) of section 24 is being amended to provide that only those e-commerce operators who are required to collect tax at source under section 52 would be required to take compulsory registration. Other e-commerce operators who are not requ

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cribed:
Provided also that a person having a unit, as defined in the Special Economic Zones Act, 2005 (28 of 2005), in a Special Economic Zone or being a Special Economic Zone Developer shall be granted a separate registration as distinct from his units located outside the Special Economic Zone in the same State or Union territory:
Provided also that a person having more than one unit, as defined in the Special Economic Zones Act, 2005 (28 of 2005), in a Special Economic Zone shall be granted a separate registration for each such unit, subject to such conditions as may be prescribed.
It is proposed to allow persons having multiple places of business in a State or Union territory to obtain separate registrations for each such place of business.
As per the extant provisions, a person seeking registration under the Act shall be granted a single registration in a State or Union territory. However, if he has multiple business verticals in a State or Union territory, he may obtain sepa

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is legal heirs, in case of death of such person, cancel the registration, in such manner and within such period as may be prescribed, having regard to the circumstances where,
(a)..
(b)..
(c) the taxable person, other than the person registered under subsection (3) of section 25, is no longer liable to be registered under section 22 or section 24.
Provided that pending cancellation
of registration, the proper officer
may suspend the registration of
the person subject to such
conditions and limitations as may
be prescribed.
It is proposed to provide that once a registered person has applied for cancellation of registration, the proper officer may temporarily suspend its registration till the procedural formalities for cancellation are completed.
This measure would relieve the taxpayer of continued compliance burden under the law till such time as the process of allowing cancellation of registration is completed.
23.
29 (2), new proviso
Provided that the proper offic

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istered person, who has supplied such goods or services or both, may issue to the recipient a one or more credit notes for supplies made in a financial year containing such particulars as may be prescribed.
(2)..
(3) ..Where a tax invoice has one or
more tax invoices have been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice the said tax invoices is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient a one or more debit notes for supplies made in a financial year containing such particulars as may be prescribed.
At present, a credit/debit note which is issued by the registered person is required to be issued invoice-wise. This causes avoidable compliance burden for tax payers. Thus, it is proposed to allow issuance of consolidated credit/debit which is in line with the best international practi

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, every registered person whose turnover during a financial year exceeds the prescribed limit (presently, ₹ 2 crore) shall get his accounts audited by a chartered accountant or a cost accountant and shall submit a copy of the audited annual accounts, the reconciliation statement under sub-section (2) of section 44 and other prescribed documents.
In this regard, Ministry of Defence has represented that the annual accounts of Canteen Stores Department (CSD) are internally audited by the Controller of Defence Accounts (CDA) and therefore, should not be subject to audit by a Chartered Accountant or a Cost Accountant.
Thus, it is proposed to provide that any department of the Central or State Government / local authority which is subject to audit by CAG need not get their books of account audited by any Chartered Accountant or Cost Accountant.
Returns
26.
39(9)
Subject to the provisions of sections 37 and 38, if any registered person after furnishing a return under sub-section

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ers to correct inadvertent mistakes in the returns by filing an amendment return.
27.
43A new insertion
43A. Procedure for furnishing return and availing input tax credit. – (1) Notwithstanding anything contained in section 37 or section 38, the procedure for furnishing the details of outward supplies by a registered person, other than an Input Service Distributor or a non-resident taxable person or a person paying tax under the provisions of section 10 or section 51 or section 52 (hereafter in this section referred to as the 'supplier'), and for verifying, validating, modifying or deleting such supplies by the corresponding registered person (hereafter in this section referred to as the 'recipient') in connection with the furnishing of return under section 39 shall be such as may be prescribed..
(2) Notwithstanding anything contained in section 41, section 42 orsection 43, the procedure for availing of input tax credit by the recipient andverification thereof shall be such as m

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t tax has not been paid by the said supplier;
(v) for the purposes of clause (ii) and (iii), the supplier and the recipient shall be jointly and severally liable to pay tax or to reverse the input tax credit availed against such tax, as the case may be;
(vi) the procedure and threshold for availing input tax credit by the recipient on the basis of invoice for which details have not been furnished by the supplier under clause (i) and recovery thereof; and
(vii) the procedure, safeguards and threshold of tax amounts in the invoices, the details of which can be furnished under clause (i) by a newly registered person or by a registered person who has defaulted in payment of tax liability, exceeding the amount of tax or the period of time specified in the rules.
A new section is being introduced in order to enable the new return filing procedure as proposed by the Returns Committee and approved by GST Council.
GST Practitioner
28.
48
48 (2) A registered person may authorise an appr

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, in that order;
(b) the central tax shall first be utilised towards payment of central tax and the amount remaining, if any, may be utilised towards the payment of integrated tax;
(c) the State tax shall first be utilized towards payment of State tax and the amount remaining, if any, may be utilized towards payment of integrated tax only when the balance of the input tax credit on account of central tax is not available for payment of integrated tax;
(d) the Union territory tax shall first be utilized towards payment of Union territory tax and the amount remaining, if any, may be utilized towards payment of integrated tax only when the balance of the input tax credit on account of central tax is not available for payment of integrated tax;
(e) the central tax shall not be utilised towards payment of State tax or Union territory tax;
(f) the State tax or Union territory tax shall not be utilized towards payment of central tax:
Provided that input tax credit on account of central

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x credit of State tax/Union territory tax towards payment of integrated tax.
It is sought to insert a new proviso to sub-section (5) in order to specify that a taxpayer would be able to utilise credit on account of CGST, SGST/UTGST, only after exhausting all the credit on account of IGST available to him.
This is being done to minimise fund settlement on account of IGST.
30.
New sub-section 5A in section 49
Notwithstanding anything contained in this section, the Government may, on the recommendations of the Council, prescribe the order of utilization of input tax credit of integrated tax, central tax, State tax or Union territory tax, as the case may be, towards payment of any such tax.
It is proposed to take an enabling power for the Government to prescribe any specific order of utilization of input tax credit of any of the taxes viz., integrated tax, central tax, State tax or Union territory tax for the payment of the said taxes.
Refunds
31.
54, Explanation (2) (e)
Expla

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nd of tax paid on zero rated supplies export of goods or services or both or on inputs or input services used in making such zero-rated supplies exports;
Section 54 (8) provides a list of situations where the principle of unjust enrichment does not apply for the purposes of payment of refund. One such situation is zero-rated supplies of goods or services.
Zero-rated supply under section 16 (1) of the IGST Act includes physical exports of goods or services and supplies made to an SEZ unit/SEZ developer and the principle of unjust enrichment does not apply in such cases. Presently, under section 16 (3) of the IGST Act, only the supplier making supplies of goods or services to an SEZ unit/SEZ developer can claim refund. It is proposed to allow ITC to the SEZ developer or SEZ unit and the supplier in DTA may recover the tax amount from such SEZ unit, etc.
Thus, it is proposed to amend section 54(8)(a) in order to provide that the principle of unjust enrichment will apply in case of ref

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gulations.
In this respect, the provisions of section 2(6)(iv) of the IGST Act are also being amended to provide that services shall qualify as exports even if the payment for the services supplied is received in Indian rupees as per RBI regulations.
Recovery of Tax
34.
79 (1)
In this section, two Explanations are proposed to be inserted as under:
Explanation .-
(1) For the purposes of this section, the word person shall include “distinct persons” as referred to in sub-section (4) or, as the case may be, sub-section (5) of section 25.
(2) For the purposes of this clause, the term “Collector” means the Collector of a revenue district and includes a Deputy Commissioner or a district magistrate or head of the revenue administration in a revenue district.
It is proposed to provide that recovery may be made from distinct persons present in different States / UTs in order to ensure speedy recovery from other establishments of the registered person.
It is proposed to clarify the

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of rupees.
36.
112 (8)
No appeal shall be filed under sub-section (1), unless the appellant has paid
(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and
(b) a sum equal to twenty per cent. of the remaining amount of tax in dispute, in addition to the amount paid under sub-section (6) of section 107, arising from the said order, subject to a maximum of fifty crore rupees, in relation to which the appeal has been filed.
In terms of section 112 (8), the appellant is required to pay a sum equal to 20% of the tax in dispute, in addition to the amount paid under section 107 (6), arising from the order of the Appellate Authority for filing an appeal before the Appellate Tribunal.
This section is being amended to provide a ceiling of ₹ 50 crores for filing an appeal before the Appellate Tribunal.
This is a taxpayer-friendly amendment especially in cases where the tax demand is of hundreds of cro

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he Additional Duties of Excise (Textile and Textile Articles) Act, 1978;”
(v)… ”
Explanation 3.-For removal of doubts, it is clarified that the expression “eligible duties and taxes” excludes any cess which has not been specified in Explanation 1 or Explanation 2 above and any cess which is collected as additional duty of customs under sub-section (1) of section 3 of the Customs Tariff Act, 1975.
It is proposed to clarify that only transitional credit of eligible duties can be carried forward in the return and not all credits. This provision is already contained in rule 117(1) of the CGST Rules.
The eligible duties do not include the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978.
For removal of doubts, it is proposed to clarify that the expression “eligible duties and taxes” excludes any cess which has not been specified in Explanation 1 or Explanation 2 above and any cess which is collected as

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India, or with or without payment of tax for export, as the case may be:
Provided that the period of one year or three years, as the case may be, may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding one year and two years respectively.
In terms of section 143 of the CGST Act, a registered person (Principal) is allowed to send inputs or capital goods to a job worker for job work without payment of tax subject to the conditions inter-alia, that the inputs and capital goods are brought back within a period of one year and three years respectively.
It is proposed to insert a proviso in section 143 to provide that the period of one year or three years may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding one year and two years respectively.
This is a taxpayer-friendly amendment to cover situations where the period of one year specified is not adequate in respect of job works such as h

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tions.
This is a taxpayer-friendly amendment.
40.
2 (16), Explanation
'governmental authority' means “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 ninety per cent. or more participation by way of equity or control, to carry out any function entrusted to a Panchayat under article 243G or to a municipality under article 243W of the Constitution”.
The reference to Panchayat under article 243G is sought to be added in the definition of Governmental authority which was left out inadvertently.
41.
12 (8)
12 (8) The place of supply of services by way of transportation of goods, including by mail or courier to,
(a) a registered person, shall be the location of such person;
(b) a person other than a registered person, shall be the location at which such goods are handed over for their transportation.
Provided that if the transportation of goods is to a place outside India, th

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of supply of services:
Provided further that nothing contained in this clause shall apply in the case of services supplied in respect of goods which are temporarily imported into India for repairs or for any other treatment or process and are exported after repairs or such treatment or process without being put to any other use in India, than that which is required for such repairs or such treatment or process;
It is proposed to not tax job work of any treatment or process done on goods temporarily imported into India (e.g., gold, diamonds) which are then exported. This is a taxpayer-friendly amendment which would encourage skill development in our country.
43.
17 (1), new proviso
17 (1):
Provided that fifty per cent. of such amount as may be decided on the recommendation of the Council, which does not get apportioned under clauses (a) to (f) for the time being, shall be apportioned to the Central Government on ad hoc basis and shall be adjusted against amounts apportioned unde

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Job Work Under GST Includes Processing Goods Into New Products, Subject to Tax Regulations.
Case-Laws
GST
Levy of GST – job-work – Whether the processing of goods belonging to another person

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GST on Uncertain Revenue
Query (Issue) Started By: – CAPurnima Bothra Dated:- 9-7-2018 Last Reply Date:- 10-7-2018 Goods and Services Tax – GST
Got 6 Replies
GST
Case Study:
Lessor has raised demand note asking lease rental for the whole year.However lessee has moved to court and is not ready to pay any dues.Now in this scenario Lessor is paying GST out of his pocket as no amount is recoverable from the lessee which leading to huge cash blockage at this moment.
Can GST amount be escaped/defered on uncertain revenue and be paid once the revenue becomes certain.
Reply By KASTURI SETHI:
The Reply:
You can decide according to the definition of 'Time of supply' as per details given below:-
13. Time of supply of se

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nt, in a case where the provisions of clause (a) or clause (b) do not apply :
Provided that where the supplier of taxable service receives an amount up to one thousand rupees in excess of the amount indicated in the tax invoice, the time of supply to the extent of such excess amount shall, at the option of the said supplier, be the date of issue of invoice relating to such excess amount.
If you have issued invoice, liability arises in the following month. If no invoice is issued, then the time of supply is the date of receipt of payment.
Reply By Alkesh Jani:
The Reply:
Sir/Madam,
Please consult your Advocate seeking the interim order from the court to get gst amount from the party, till the final order. Also check Section 92 is appli

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Amendment of invoice.
Query (Issue) Started By: – Zaid Ansari Dated:- 9-7-2018 Last Reply Date:- 10-7-2018 Goods and Services Tax – GST
Got 4 Replies
GST
Hello Sir,
I want to ask that how can i change invoice number after submitting GSTR-1.I have entered wrong invoice number in my previous month return now how can i amend it.Please Reply.
Reply By YAGAY and SUN:
The Reply:
you may make necessary changes in next month's return in statement 2A.
Reply By DR.MARIAPPAN GOVINDARAJ

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VALIDITY OF E-WAYBILL
By: – DR.MARIAPPAN GOVINDARAJAN
Goods and Services Tax – GST
Dated:- 9-7-2018

Validity of e-way bill
The e-way bill shall not be valid for movement of goods by road unless the information in Part B of Form GST EWB – 01 has been furnished except in the case of movements covered except in the following types of movements-
* Movement less than 10 kilometers within the State or the Union Territory from the place of business of the consignor to the place of business to the transporter for further transporter;
* Where the goods are transported for a distance of less than 10 kilometers within the State or the Union Territory from the place of business of the transporter finally to the place of business of the consignee, the details of conveyance may not be updated in the e-way bill.
Validity period
Rule 138(10) provides the validity period of e-way bill generated through e-way bill portal. The said rule provides that an a-way bill or a consolidated

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-way bill is generated on 05.02.2018 at 15.00 hours and the distance to be covered is 500 kms., the validity period starts from 15.00 hours on 05.02.2018 and it is valid up to 14.59 hours on 10.02.2018.
Over dimensional cargo
The explanation 2 to Rule 138 (10) defines the expression 'over dimensional cargo' as a cargo carried as a single indivisible unit and which exceeds the dimensional limits prescribed in rule 93 of the Central Motor Vehicle Rules, 1989, made under the Motor Vehicles Act, 1988 (59 of 1988).
Rule 93 of the Central Motor Vehicles Rules, 1989 provides that the overall width of a motor vehicle, measured at right angles to the axis of the motor vehicle between perpendicular planes enclosing the extreme points, 3shall not exceed 2.6 meters. For purposes of this rule, a rear-view mirror, or guard rail or a direction indicator rub-rail (rubber beading) having maximum thickness of 20 mm on each side of the body shall not be taken into consideration in measuring the overa

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8 meters;
* in the case of 3 axle passenger transport vehicles, 15 meters;
* in the case of single articulated (vestibule type) passenger transport vehicle, 18 meters (In the case of single articulated passenger transport vehicles of 18 meters length and double articulated passenger transport vehicles up to 25 meters, permission of the State Government shall be obtained regarding their plying on selected routes depending upon local road conditions, width, maneuverability of the vehicle in traffic, as deemed fit. These passenger transport vehicles will also be required to have a closed circuit TV system for proper visibility in and around the passenger transport vehicle by the driver to maintain safety. Intercom system shall also be provided in such passenger transport vehicle. In addition, the standing passenger will be allowed only on the lower deck of double articulated passenger transport vehicle.)
* in the case of double articulate passenger transport vehicles, 25 meters
In

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re wheel or spare wheel bracket or bumper fitted to a vehicle;
* any towing hook or other fitment which does not project beyond any fitment covered by above.
Extension of time
Generally the validity of period may not be extended. However, the Commissioner may, by notification, extend the validity period of e-way bill for certain categories of goods as may be specified in the said notification.
Generation of another e-way bill
Where, under circumstances of an exception nature, the goods cannot be transported within the validity period of the e-way bill, the transporter may generate another e-way bill after updating the details in Part B of Form GST EWB – 01.
Validity in other States
The e-way bill generated under Rule 138 of the Central Goods and Services Tax Rules of any State shall be valid in every State and Union territory.
Validity of consolidated e-way bill
A consolidated e-way bill has no separate validity. It will be governed by the underlying validity period of the in

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Sanjay Kumar Bhuwalka, Neeraj Jain Versus Union of India
GST
2018 (7) TMI 589 – CALCUTTA HIGH COURT – 2018 (362) E.L.T. 568 (Cal.) , 2018 (19) G. S. T. L. 582 (Cal.)
CALCUTTA HIGH COURT – HC
Dated:- 9-7-2018
CRM 3327 of 2018, CRM 3328 of 2018
GST
Shivakant Prasad, J.
For the Petitioner : Mr. Sekhar Basu Mr. Debasish Roy Mr. Rajdeep Majumder Mr. Danish Haque Mr. Arindam Dey Mr. Mayukh Mukherjee Mr. K.L. Mukherjee Mrs. Aroshi Rathore Mrs. Kriti Mehorotra
For the Opposite Party : Mr. K.K. Maity
ORDER
Shivakant Prasad, J.
The above two cases under provision of Section 439 Cr.P.C. have been filed by two separate petitioners under the same Memo of Arrest by the opposite party, Union of India whereunder petitioners have prayed for enlarging them on bail, inter alia, on the grounds stated in the petitions. Both the cases were heard analogously as the legal issue and the factual aspects of the case are common. So they can be disposed of by a common judgment.
To speak

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Works, M/s. Amazonite Steel Pvt. Ltd., M/s. Corandum Impex Pvt. Ltd., M/s. Cuprite Marketing Pvt. Ltd. and M/s. Binky Exim Pvt. Ltd. were all part of a well thought out conspiracy aimed at duping the exchequer by way of creation of a complex web of inter-connected companies engaged in fraudulent issuance of tax invoices without supply of goods or services to enable the recipient companies to avail and utilize fake input tax credit leading to loss of Government revenue.
It is contended that the investigation revealed that all the above fake companies were being controlled and run by a group of persons including Shri Sanjay Kumar Bhuwalka and Shri Neeraj Jain being the petitioners herein.
Summons were issued to the petitioners under Section 70 of the CGST Act, 2017 read with Section 174(2) of the said Act and in their statements, they have admitted that they were looking after and controlling the business activities of the companies.
It was further revealed that various companies wer

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der :
“69. Power to Arrest –
(1) Where the Commissioner has reasons to believe that a person has committed any offence specified in clause (a) or clause (b) or clause (c) or clause (d) of sub-section (1) of section 132 which is punishable under clause
(i) or (ii) of sub-section (1), or sub-section (2) of the said section, he may, by order, authorise any officer of central tax to arrest such person.
(2) Where a person is arrested under sub-section (1) for an offence specified under subsection (5) of section 132, the officer authorised to arrest the person shall inform such person of the grounds of arrest and produce him before a Magistrate within twenty-four hours.
(3) Subject to the provisions of the Code of Criminal Procedure, 1973 (2 of 174),-
(a) where a person is arrested under sub-section (1) for any offence specified under sub-section (4) of section 132, he shall be admitted to bail or in default of bail, forwarded to the custody of the Magistrate;
(b) Commissioner

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d non-payment, whatever be the means applied for such non-payment confers right on the government, both Central and State, to realize the revenue whereas penal provision of arrest and detention is only when there is violation of the provision under the statute which is not the intention of the legislature to achieve the fiscal object regardless of the existence of a provision for the arrest of the offender in the Act.
It has been argued that it is trite law that a provision of law which seeks to apply will lead to deprivation of liberty of a citizen, ought to be construed strictly regard being had to the mandate of Article 21 of the Constitution of India, namely, the observance of “procedure established by law”.
Under Section 69 of the Act the functionary is the Commissioner as defined in Section 2(24) of the Act, “Commissioner” means the Commissioner of central tax and includes the Principal Commissioner of central tax appointed under section 3 and the Commissioner of integrated tax

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f Arrest with the sentence “proposal at A approved”. It is further submitted that while interpreting penal law protection of liberty has to be accepted as the provision of the statute provides that the authority must have reasonable believe and relied on the expression “reason to believe” means jurisprudentially as observed by the Hon'ble Supreme Court in the case of Joti Parshad vs. State of Haryana reported in 1993 Supp(2) Supreme Court Cases 497 at paragraph 4 of extract of the observation in the cited judgment which reads thus-
“4. Under the Indian penal law, guilt in respect of almost all the offences is fastened either on the ground of “intention” or “knowledge” or “reason to believe”. We are now concerned with the expressions “knowledge” and “reason to believe”. “Knowledge” is an awareness on the part of the person concerned indicating his state of mind. “Reason to believe'” is another facet of the state of mind. “Reason to believe” is not the same thing as “suspicion”

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in of probable reasoning leading to the conclusion or inference about the nature of the thing. These two requirements i.e. “knowledge” and “reason to believe” have to be deduced from various circumstances in the case……”
Bearing in mind the principle laid in the said observation, it is suffice to say such “reasons to believe” has to be formed by the Commissioner after the records of such inspection and search are communicated to him under sub-section 10 of section 67 of the Act or in any other manner the materials are placed before him for the formation of his “reason to believe”. When the Commissioner or the delegatee has reason to believe that the person concerned has committed an offence which necessitates arrest, an order has to be passed and such order logically, reasonably and prudentially must be informed by reasons or must contain the reasons which have emanated from “reasons to believe” entertained by the authority concerned.
Adverting to the Memo of Arrest and the order

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e Additional Director General Goods and Service Tax Intelligence to consider all the materials available with regard to the accusations of commission of the offences mentioned in section 69 of the Act and come to his own conclusion for effecting arrest unhindered, unaffected by interference from any quarter.
It is further contended that the entire exercise by the officers sub-ordinate to the Additional Director General Goods and Service Tax Intelligence and the ultimate signature on the document by the Additional Director General Goods and Service Tax Intelligence are merely topsy-turvy, deplorable administrative exercise of power and a threat to the Constitutional observance of “procedure established by law”. It is further submitted that despite delegation of powers of the Commissioner on officers sub-ordinate to him, the structural edifice of the statute presents the Commissioner to be at the helm of affairs.
To buttress such contention, the attention of this Court has been drawn t

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and Customs appointed the officers in the Directorate General of Goods and Services Tax Intelligence as Central Tax officers and invested them with all the powers under the said Act and the Rules made thereunder. In terms of the said Notification, the post of Additional Director General, Goods and Services Tax Intelligence, is equivalent to the post of Commissioner. Accordingly, the said Additional Director General, Directorate General of Goods and Services Tax Intelligence, has been empowered under section 69 of the Act to exercise all the powers invested in the Commissioner of Central Tax. Therefore, he was well within his jurisdiction while directing the concerned officers to arrest the said persons.
In response to the interpretation as to reasonable belive Mr. Maity submitted that the office note reveals that the said Additional Director General, based on the facts brought out from the investigation conducted by the DGGI, had reasons to believe that the petitioners have committed

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T 618 Calcutta wherein the Hon'ble Division Bench held that whether the seizure under Section 110 of the Customs Act, 1962 was under a reasonable belief or not is a justiceable one, but once it is held that there was material, relevant and germen the sufficiency of the material is not open to judicial review.
Having regard to rival contentions I am of the considered opinion that 'reasonable belief' or reason to believe as a standard to arrest requires that arresting officer subjectively believe that the suspect has committed the offence and that objectively reasonable person would reach the same conclusion. Reasonable grounds do not require as much evidence as a prima facie case but do require that thing believed to be more likely than not.
Therefore, in the light of the aforesaid contentions, the submission of the petitioners that no reason has been assigned for arrest has no legs to stand upon, particularly in view of the fact that the said office note itself clearly provides t

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have been arrested and further investigation is required to reveal whom the petitioners have supplied all these fake invoices.
It is also submitted that they are either labourer of jute mill or tea seller or unemployed aged between 20 to 30. In their statement, they stated that through agent of the accused Shri Sanjay Bhuwalka they met the accused and submitted copies of their personal documents like PAN Card, Voter Id Card etc. and signed many other documents. In exchange, the accused promised to pay them Rs. 4,000/- per month. Further, the Department has recorded statement of Bank Manager of Laxmivilas Bank on 11.05.2018, where he categorically mentioned that Bank accounts relating to the fake/shell companies were operated either by the accused themselves or by their employee and in the event petitioners are enlarged on bail, there is every probability of tampering the documents and the recipient who have received the fake tax invoices from them and wrongfully availed the input tax

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e considering the question of grant of bail to an accused it should be seen whether it is desirable in National interest or not.
In the case of Rajesh Goyal -Vs- Union of India reported in 2012 (284) E.L.T. 164 Raj it has been observed that the accused petitioner has evaded the excise duty causing a great loss to the public exchequer. Hence, the offence being of grave nature, the petitioner should not be allowed bail. The Hon'ble Court also held that the act of the petitioners may be termed as `Royal Thievery' which is opposed to both democracy and society.
In the case of Subhas Chandra Bal Chandra Badjata -Vs DGCE (Intelligence) Mumbai reported in 2015(324) E.L.T 307-Born the Hon'ble Court has observed that the material collected shows that false record was created for evasion of excise duty. Thus it is case of forgery and fraud.
In the case of Directorate of revenue Intelligence -Vs- Chander Prakash Verma reported in 2016 (332) E.L.T 693 Del. the Hon'ble Court has

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and 138 of the Act the object and reason of this Act is obviously to realise the revenue to the Government Exchequer and bearing in mind the provision of compounding nature of the offence under Section 138 of the Act.
I am fully aware of the observation of the Hon'ble Supreme Court that economic offences constitute a class apart and need to be visited with a different approach in the mater of a bail. The economic offence having deep rooted conspiracy and involving huge loss of public funds needs to be viewed seriously and considerd as grave offences affecting the economy of the country as a whole and thereby posing a serious threat to the financial health of the country. While granting bail, the Court has to keep in mind the nature of the accusations, the nature of evidence in support thereof the severity of the punishment which conviction will entail, the character of the accused, reasonable apprehension of the witnesses being tampered with, the larger interest of the public/ State

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M/s. Hinduja Foundries Ltd. Versus Commissioner of GST & Central Excise
Central Excise
2018 (7) TMI 610 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 9-7-2018
Appeal No. E/40354/2018 – Final Order No. 41953 / 2018
Central Excise
Hon'ble Ms. Sulekha Beevi C.S., Member ( Judicial )
Shri M. Kannan, Advocate for the Appellant
Shri R. Subramaniam, AC (AR) for the Respondent
ORDER
Brief facts are that the appellants are engaged in manufacture of cast articles of iron and aluminium. They purchased three machineries (capital goods) in the year 1996 – 1997. In 2005, they cleared those capital goods to M/s. Shanthi Casting Works, Coimbatore which is their job worker under returnable delivery challans along with excise in

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show cause notice was issued to the appellant for recovery of the credit to the tune of Rs. 5,92,946/- along with interest and for imposing penalties. After due process of law, the original authority confirmed the demand, interest and imposed penalties. In appeal, Commissioner (Appeals) upheld the same. Hence this appeal.
2. On behalf of the appellant, ld. counsel Shri M. Kannan submitted that when the capital goods were returned to the appellant's factory by the job worker, the goods were actually returned but the documents evidencing such return of goods is not traceable. He prayed that the whole issue arises out of an error in accounting and therefore may be condoned.
3. The ld. AR Shri R. Subramaniam supported the findings in the impu

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ter hearing the submissions and perusing the records, it is brought out that the appellants after shifting the capital goods to their job worker in 2005 has issued a returnable delivery challan with central excise invoice and also paid duty. Thereafter in 2011, though invoices were issued showing that the capital goods were turned to the appellant's factory, they have not been actually returned. The only explanation given by the appellant is that the documents evidencing that the goods have been returned is not traceable. Such a flimsy explanation is not acceptable. On the whole, it is seen that the demand raised requires no interference. The appellant has not been able to explain how and why they have availed such excess wrongful credit. I

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M/s. Rane Brake Lining Ltd. Versus Commissioner of GST & Central Excise
Central Excise
2018 (7) TMI 611 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 9-7-2018
Appeal No. E/40355/2018 – Final Order No. 41955 / 2018
Central Excise
Hon'ble Ms. Sulekha Beevi C.S., Member (Judicial)
Ms. S. Yogalakshmi, Advocate for the Appellant
Shri R. Subramaniam, AC (AR) for the Respondent
 
ORDER
Brief facts are that the appellants are manufacturers of Railway Brake Blocks, Disc Pads and Clutch Facings. They were availing the facility of CENVAT credit on inputs, capital goods and input services. Show cause notice was issued proposing to disallow the credit on various input services and after due process of law, the original authority allowed the credit on various services. The credit in respect of service tax paid on Director Sitting Fees as well as on premium for product liability insurance was disallowed. In appeal, Commissioner (Appeals) upheld the same. Hence this

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id for director sitting, she submitted that they have discharged the liability under reverse charge mechanism and it is incumbent upon the Director to attend the meetings and therefore the same is directly connected to the manufacturing activity of the appellant. To support her argument, she relied upon the decision in the case of SKN Organics P. Ltd. & Anr. Vs. Commissioner of Central Excise, Puducherry vide Final Order Nos. 41948 & 41949/2016 dated 21.10.2016.
3. The ld. AR Shri R. Subramaniam supported the findings in the impugned order. He adverted to para 7 of the impugned order and submitted that once the goods are sold and the products are handed over to the buyers, any service availed by them would be a post-manufacturing activity and therefore the insurance policy taken for product liability cannot be held to be an input service. With regard to the director sitting fee, he submitted that this has no nexus to the manufacturing activity.
4. Heard both sides.
5. The first issu

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facturer. Further, in the case of Granules India Ltd. (supra), the Tribunal has held that the credit availed on directors' liability insurance is eligible. I find that the disallowance of credit on this input service is unjustified and requires to be set aside, which I hereby do.
6. The second issue for consideration is regarding the eligibility of credit on service tax paid on Director Sitting Fees. The said issue is covered by the decision in the case of SKN Organics P. Ltd. (supra). Further, it is also to be stated that it is the duty of the director to attend the meetings and therefore the service tax paid on such fees is eligible for credit.
7. From the discussions made above, I am of the view that the disallowance of credit on the impugned services is incorrect and requires to be set aside, which I hereby do. The impugned order is set aside and the appeal is allowed with consequential relief, if any.
( Dictated and pronounced in open court )
Case laws, Decisions, Judgement

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M/s. Esskay Design & Structures Pvt. Ltd. Versus Commissioner of GST & Central Excise
Service Tax
2018 (7) TMI 621 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 9-7-2018
Appeal Nos. ST/42235 & 42236/2017 – Final Order Nos. 41956-41957 / 2018
Service Tax
Hon'ble Ms. Sulekha Beevi C.S., Member (Judicial)
Shri M. Kannan, Advocate for the Appellant
Shri R. Subramaniam, AC (AR) for the Respondent
ORDER
Brief facts are that the appellants are engaged in providing consulting engineering service. They filed refund claim under Rule 5 of CENVAT Credit Rules, 2004 for the unutilized credit. Show cause notice was issued proposing to reject the refund claim on the following four grounds:-
The assessee has not filed declaration with Deputy / Assistant Commissioner before export
Accumulated CENVAT credit pertains to period prior to registration
The assessee had filed ST-3 return belatedly on 19.2.2016 wherein under col. B1.8, the export of services was declared as

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aration and therefore the proposal for rejection of the refund claim on this ground is not correct. With regard to the second ground that the service recipient and assessee are the same entity, it was clarified by the adjudicating authority that both these are different and distinct entities. In regard to the ground for rejection that the appellant has not mentioned the quantum of export in their ST-3 returns for April 2014 to September 2014, it was held by the adjudicating authority that this was merely an error in filing the return and it was condoned. Thus, the adjudicating authority after analyzing the above three grounds dropped those grounds for rejecting the refund claim. However, the department has not filed any appeal against this before the Commissioner (Appeal) but the Commissioner (Appeals) has taken up all these grounds and has erroneously held against the appellant even though there is no appeal filed by the department.
3.2 With regard to the ground for rejection that th

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grounds and held against the appellant which is not proper. The department having not filed any appeal against the Order-in-Original, I find force in the contention of the ld. counsel. Thus, the rejection of refund as held by the Commissioner (Appeals) in the impugned order on the three grounds is incorrect and requires to be set aside, for the reason that the department has not appealed against the order passed by the adjudicating authority.
6.1 The issue that remains for consideration is whether the appellant is eligible for refund for the credit availed before obtaining registration of the premises. The said issue stands covered by the judgment relied by the ld. counsel for the appellant. Following the same, I am of the view that the rejection of refund claim cannot sustain and requires to be set aside.
7. From the above discussion, I hold that the impugned order which rejects the refund claim filed by the appellant requires to be set aside, which I hereby do. The impugned order

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M/s Chamunda Papers Pvt. Ltd Versus Union Of India And 4 Others
GST
2018 (7) TMI 665 – ALLAHABAD HIGH COURT – TMI
ALLAHABAD HIGH COURT – HC
Dated:- 9-7-2018
WRIT TAX No. 944 of 2018
GST
Hon'ble Bharati Sapru And Hon'ble Dinesh Kumar Singh, JJ.
For the Petitioner : Suyash Agarwal
For the Respondent : A.S.G.I.,C.S.C.,Ramesh Chandra Shukla
ORDER
Heard Sri Suyash Agrawal, learned counsel for the petitioner, Shri Anant Kumar Tiwari, Advocate holding brief of Sri Gyan Prakash, ASGI appearing for the respondent nos.1, 2 & 3 and Shri R.C. Shukla, Advocate appears for the respondent nos.4 and 5.
The petitioner seeks a writ of mandamus directing the GST council respondent no.2 to make recommendations to the State Go

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M/s. Alkraft Thermotechnologies Pvt. Ltd. Versus Commissioner of GST & Central Excise
Central Excise
2018 (7) TMI 686 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 9-7-2018
Appeal Nos. E/40311 to 40313/2018 – Final Order Nos. 41949-41951 / 2018
Central Excise
Hon'ble Ms. Sulekha Beevi C.S., Member ( Judicial )
Shri R. Anish Kumar, Advocate for the Appellant
Shri S. Govindarajan, AC (AR) for the Respondent
ORDER
The issue in all these appeals being same, they were heard together and are disposed by this common order.
2. Brief facts are that the appellants are manufacturers of radiators and parts and are availing the facility of CENVAT credit of duty paid on inputs and service tax paid for input services. On verification of records, it was noticed that during the periods September 2009 to February, 2010 and October 2014 to April 2015, May 2015 to February 2016, the appellant had availed CENVAT credit on outward transportation of goods for the goods cleared

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In terms of Rule 2(qa) of CENVAT Credit Rules, 2004 also the 'place of removal' means a factory or any other place or premises of production or manufacture of the excisable goods. The place of removal is required to be determined with reference to 'point of sale'. In the case of stock transfer, the entire goods are transferred to the other manufacturing unit of the appellant and therefore at the factory gate no sale takes place. Thus, in the case when the goods are stock transferred to their own unit for further manufacture, the place of removal cannot be considered as the factory gate. Only if there is a sale, the said point can be considered as a place of removal. To support his argument, he relied upon the judgment of the Hon'ble Supreme Court in the case of Commissioner Vs. Roofit Industries Ltd. – 2015 (319) ELT 221 (SC). The Board Circular No. 1065/4/2018-CX dated 8.6.2018 was also relied by the ld. counsel for the appellant. He further took assistance of the decision of the Tri

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ble goods are to be sold after their clearance from the factory;]
from where such goods are removed”.
Input services after 1.4.2008
'Input service” means,-
(i) services provided or agreed to be provided by a person located in non-taxable territory to a person located in non-taxable territory by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India where service tax is paid by the manufacturer or the provider of output service being importer of goods as the person liable for paying service tax for the said taxable services and the said imported goods are his inputs or capital goods; or
(ii) any service used by a provider of output service for providing an output service; or
(iii) any service used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal,
and includes services used in relation to modernisati

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sion of one or more of the specified services; or]
[(B) [services provided by way of renting of a motor vehicle], in so far as they relate to a motor vehicle which is not a capital goods”
7. With effect from 1.4.2008, in the definition of input services the words 'upto the place of removal' has been substituted instead of 'from the place of removal'. The ld. counsel has strenuously argued that since there is no sale of goods from the factory gate when the goods are stock transferred to their own unit for further manufacture, the factory gate cannot be considered as place of removal. According to him, Section 4(3)(c) of Central Excise Act, 1944, uses the word 'place of removal' as the place from where the goods are sold. In the appellant's case, the intermediate goods are removed on payment of excise duty on the basis of CAS-4 for further manufacture to their sister unit. It is thus argued that though goods are removed on payment of duty to their sister unit, it does not amount to sa

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t it is admittedly not clearance for sale of the goods. In terms of Section 4(3)(c) of Central Excise Act, 1944, definition of place of removal is as under :
'Place of removal' means :-
(i) a factory or any other place or premises of production or manufacture of excisable goods;
(ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty;
(iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearances from their factory.
from where such goods are removed.”
From the above definition, it is clear that where the goods is cleared from factory, but place of removal is determined only a place, where the goods is sold. In case goods is sold from factory, the factory gate is considered as place of removal but though the clearances is made from the factory but goods is not sold from factory, but sold at any other place after r

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rved that credit of service tax paid on transportation of clinker to their sister unit is admissible as there is no case of sale and transfer of property in goods at the factory gate. The relevant portion is as follows:-
“6. After careful consideration of the facts, the submissions of both the sides and the case laws cited, it appears that the facts do not involve any sale of the goods in question. The goods viz. clinker is to be transported from party's premises to their sister unit premises and the respondent viz. Lafarge India Pvt. Ltd. is not taking any consideration for the same as Jojobera unit being their sister unit. It is clear that the definition 'place of removal' is inextricably linked with the fact of 'sale'. When present facts do not involve any sale, one cannot say that the factory premises of the appellant is the 'place of removal'. Therefore, the Revenue's contention that Cenvat credit cannot be allowed on account of transportation services used for transportation of

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expression 'from the place of removal'. As per the said definition, service used by the manufacturer of clearance of final products 'from the place of removal' to the warehouse or customer's place etc., was exigible for Cenvat Credit. This stands finally decided in Civil Appeal No. 11710 of 2016 (Commissioner of Central Excise Belgaum v. M/s. Vasavadatta Cements Ltd.) vide judgment dated January 17, 2018. However, vide amendment carried out in the aforesaid Rules in the year 2008, which became effective from March 1, 2008, the word 'from' is replaced by the word 'upto'. Thus, it is only 'upto the place of removal' that service is treated as input service. This amendment has changed the entire scenario. The benefit which was admissible even beyond the place of removal now gets terminated at the place of removal and doors to the Cenvat credit of input tax paid gets closed at that place. This credit cannot travel therefrom. It becomes clear from the bare reading of this amended Rule, whi

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MGI Infra Private Limited. Versus Assistant Commissioner State Goods and Service Tax Others
GST
2018 (7) TMI 754 – CALCUTTA HIGH COURT – 2018 (15) G. S. T. L. 481 (Cal.) , [2018] 59 G S.T.R. 169 (Cal)
CALCUTTA HIGH COURT – HC
Dated:- 9-7-2018
W. P. No. 10646(W) of 2018
GST
Debangsu Basak, J.
Mr. Boudhyan Bhattacharyya, Mr. Anindya Bagchi for petitioner
Mr. Abhratosh Mazumder, Ld. Addl. A.G., Mr. Prithu Dudhoria, Mr. Debasish Ghosh for the State.
Mr. K. K. Maity, Mr. Bhaskar Prasad Banerjee for respondent
ORDER
The petitioner seeks consideration of an application for extension of time to obtain the final registration under the provisions of the Central Goods and Service Tax Act, 2017 and the West Bengal Goods and S

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itioner to take appropriate steps under the two Acts of 2017.
In such circumstances, it would be appropriate to request the first respondent so far as the State authorities are concerned and 4th respondent so far as the central authorities are concerned to consider and decide the request of the petitioner for grant of permanent registration, in accordance with law.
The first and fourth respondents are requested to take a pragmatic practical and sympathetic to the problems.
The State and the Central Government will consider the grant of final registration under their respective jurisdiction in accordance with the West Bengal Goods and Service Tax Act, 2017 and the Central Goods and Service Tax Act, 2017 respectively.
WP No.10646(W) of 20

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The Commissioner of GST & Central Excise Versus M/s. Visual Graphics Computing Services India Pvt Ltd
Service Tax
2018 (7) TMI 1394 – MADRAS HIGH COURT – TMI
MADRAS HIGH COURT – HC
Dated:- 9-7-2018
C.M.A. No. 1457 of 2018
Service Tax
S. Manikumar And Subramonium Prasad, JJ.
For the Appellant : Mrs. R. Hemalatha
JUDGMENT
( Judgment of this Court was made by S. Manikumar, J. )
Civil Miscellaneous Appeal is filed against the Final Order No.42324 of 2017, dated 11/10/2017, on the file of the Customs Excise and Service Tax Appellate Tribunal, South Zone Bench, Chennai.
2. Short facts leading to the appeal are that, M/s.Visual Graphics Computing Services India Pvt Ltd., Chennai are the provider of services under the category of Information Technology Software Service.  Appellant had filed refund claim of Rs. 2,50,07,166/-, for the period April 2012 to June 2012, under Rule 5 of Cenvat Credit Rules, 2004. Original Authority rejected part of the refund claim of

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d 18/6/2012″
5. Supporting the prayer, Ms.R.Hemalatha, learned counsel for the appellant submitted that registration is an act by which every manufacturer/assessee/service provider, comes under the ambit of Central Excise Act, 1944 / Finance Act, 1994. In order to avail any substantive benefit, like, CENVAT Credit available under the statute, registration of premises from which the taxable service is rendered is a pre-requisite. Therefore, when registration has not been done as per Section 69 of the Act, the respondent is not entitled for refund of CENVAT read with rule 4(1) of the Rules which render them ineligible far CENVAT credit an input services accumulated prior to registration.
6. Learned counsel for the appellant further submitted that the respondent is not entitled for refund of CENVAT credit in respect of input or input service used, in export of service, without payment of service tax, prior to the date of their being registered with service tax department. According to

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absence of express provision to grant refund, that is difficult to entertain except in the case of export. There cannot be presumption that in the absence of debarment to make refund, in other cases that is permissible. Refund results in outflow from treasury, which needs sanction of law and an order of refund for such purpose is sine qua non. Law has only recognized the event of export of goods for refund of Modvat credit as has been rightly pleaded by Revenue and present reference is neither the case of “otherwise due” of the refund nor the case of exported goods. Similarly absence of express grant in statute does not imply ipso facto entitlement to refund. So also absence of express grant is an implied bar for refund. When right to refund does not accrue under law, claim thereof is inconceivable. Therefore, present reference is to be answered negatively and in favour of Revenue since refund of unutilized credit is only permissible in case of export of goods and for no other reason

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ecedent, in view of Section 35R (3) of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994. The subsequent decision of CESTAT, Madras, vide FO No. 42500/2016 dated 20/12/2016 in the case of the same party viz., M/s Scioinspire Consulting Services (India) P Ltd. was also appealed in this Hon'ble Court, by the department vide CMA. Sr. No.54980 of 2017.
9. Learned counsel for the appellant further submitted that a Hon'ble Division Bench of this Court, in the case of Commissioner of Central Excise, Coimbatore Vs Sutham Nylocots, vide final order in CMA No.926/2006, dated 09.01.2014, reported in 2014 (306) E.L.T. 255 (Mad) held that 'if at all the assessee is entitled to any credit it would accrue only subsequently to the date of the registration with the Department'. Hence, refund of unutilized input CENVAT credit taken towards rendering the input services availed and used in providing taxable output services exported would not arise, prior to the da

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considering the provisions, relevant notifications and decisions in M/s.mPortal India Wireless Solutions Private Limited V. Commissioner of Service Tax, Bangalore, reported in 2012 (27) S.T.R.134 (Kar.); in Commissioner of Service Tax V. Tavant Technologies India Private Limited, reported in 2016 (3) TMI 535; in Commissioner, Service Tax Commissionerate V. Atrenta India Private Limited, reported in 2017 (2) ADJ 590; and in Commissioner of Central Excise, Coimbatore Vs. Sutham Nylocots, reported in 2014 (306) E.L.T. 255 (Mad), a Hon'ble Division Bench, answered the above said substantial questions of law, raised therein, against the revenue. Following the decision in C.M.A.No.860 of 2017, dated 10/4/2017, instant Civil Miscellaneous Appeal No.3493 of 2017, filed by the revenue, on the same substantial questions of law is liable to be dismissed.
13. Accordingly, Civil Miscellaneous Appeal is dismissed. No costs. The facts and circumstances of the substantial questions of law are ans

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M/s I.T.I. Ltd. Versus Commissioner CGST & Central Excise, Allahabad
Central Excise
2018 (8) TMI 85 – CESTAT ALLAHABAD – TMI
CESTAT ALLAHABAD – AT
Dated:- 9-7-2018
E/70523/2018-EX[SM] – FINAL ORDER NO 71371/2018
Central Excise
Mrs. Archana Wadhwa, Member (Judicial)
Shri S.P. Ojha (Advocate) for Appellant
Shri Gyanendra Kumar Tripathi, AC (AR) for Respondent
ORDER
Per: Archana Wadhwa
After hearing both the sides I find that the appellant were manufacturing excisable goods as well as doing some trading activities. As per the Revenue, the appellant availed Cenvat Credit on common services, which were being utilized by them in the manufacture of excisable goods as well as in providing trading activities. Accordingly,

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t be considered to be exempted services. He also set aside the penalty imposed upon the appellant by observing that the appellant simplicitor did not reverse the amount in terms of Rule 6(3), which cannot be considered to be mala fide on their part.
The said order of Commissioner (Appeals) is impugned order before Tribunal.
3. Learned Advocate appearing for the appellant assails the impugned order on the point of limitation. He submits that there was lot of confusion and the earlier decisions of the Tribunal held that the trading activities cannot be considered to be services, much less exempted services. The law was amended w.e.f. 01.04.2011 and the disputed issue was bona fide issue of interpretation of the provisions of law, no mala fi

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pose a mala fide mind with intention to evade payment of duty. It is well settled that if penalty has been set aside, thus leading to believing the bona fide of the appellant, the normal period of limitation would not be available to the Revenue. As such on this ground as also by taking into account the Tribunal's decisions in the case of Krishna Auto Sales vs. Commissioner of C. EX. S.T., Chandigarh reported at 2015 (40) S.T.R. 1121 (Tri.-Del.) and Commissioner of C. EX., Mangalore reported at 2011 (270) E.L.T. 305 (S.C.), I hold that the demand raised beyond the normal period of limitation is not justified, the same is set aside.
5. However, a part of a demand would fall within the limitation period and the learned advocate has given und

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Commission of Central GST Versus Jay Chemical Industries Ltd.
Central Excise
2018 (8) TMI 1392 – GUJARAT HIGH COURT – 2018 (19) G. S. T. L. 459 (Guj.)
GUJARAT HIGH COURT – HC
Dated:- 9-7-2018
R/TAX APPEAL NO. 767 to 770 of 2018 and 814 of 2018, 815 of 2018
Central Excise
MR. M.R. SHAH AND MR. A.Y. KOGJE JJ.
Appearance: –
Tax Appeal Nos.767 of 2018 to 770 of 2018
MR NIRZAR S DESAI(2117) for the APPELLANT(s) No. 1
NOTICE SERVED BY DS(5) for the RESPONDENT(s) No. 1
Appearance: – Tax Appeal Nos.814 of 2018 to 815 of 2018
MR NIRZAR S DESAI(2117) for the APPELLANT(s) No. 1
MR DHAVAL SHAH for the RESPONDENT(s) No. 1
ORAL JUDGMENT
(PER : HONOURABLE MR.JUSTICE M.R. SHAH)
1. As common question of fact and law arises in this group of appeals, all these appeals are decided and disposed of together by this common judgment and order.
2. Feeling aggrieved and dissatisfied with the impugned common judgment and order passed by the learned Customs, Excise and Service Ta

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?
[b] Whether the CESTAT is right in law passing an order for no recovery or any refund of Cenvat Credit of Service Tax paid on Sales Commission during the period?”
2. Shri Nirzar Desai, learned Advocate has appeared on behalf of the Revenue in each of the appeals and Shri Dhaval Shah, learned Advocate, has appeared on behalf of the respondent-assessee in Tax Appeal Nos.814 of 2018 and 815 of 2018. Though served, nobody appears on behalf of the respective respondent-assessees in remaining appeals.
3. Shri Desai, learned Advocate appearing on behalf of the Department has vehemently submitted that as such, the issue involved in the appeals before the learned Tribunal on merits has been concluded in favour of the Revenue in view of the decisions of this Court in the case of Commissioner of C.Ex. Ahmedabad-II Vs. Cadila Healthcare Ltd., reported in 2013 (30) STR, 3 and in the case of Astik Dyestuff Pvt. Ltd. Vs. Commissioner of Central Excise and Customs, reported in 2014 (34) STR, 814.

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in the case of Cadila Healthcare Ltd. (supra) and Astik Dyestuff Pvt. Ltd. (supra), shall not be applicable and that the assessee shall be entitled to the Cenvat credit on the service tax paid on sales commission. It is submitted that therefore the learned Tribunal has rightly not decided the appeals on merits, pending decision of this Court in the case of Essar Steel India Ltd., being Tax Appeal No.444 of 2016. However, it is fairly conceded and admitted that instead of disposing of the appeals, the learned Tribunal could have and ought to have kept the appeals pending rather than passing such an order disposing of the appeals and reserving liberty to both the sides to approach the Tribunal soon after the verdict of this Court in the pending appeal in the case of Essar Steel India Ltd., being Tax Appeal No.444 of 2016.
5. Having heard learned Advocates appearing on behalf of the respective parties and considering the impugned common order passed by the learned Tribunal, we, as such d

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with liberty to both sides to approach the Tribunal after decision of this Court in the pending appeal in the case of Essar Steel India Ltd., being Tax Appeal No.444 of 2016. Such an order would not help either the Revenue /Department and even the assessee. Such a procedure adopted by the learned Tribunal would cause harassment to the assessee as well as inconvenience to the Department. Therefore, we are of the opinion that the procedure adopted by the learned Tribunal disposing of the appeals without deciding the same on merits with liberty approach the Tribunal after decision of this Court in the pending appeal is neither correct not proper and the same deserves to be quashed and set aside.
6. As recorded hereinabove, even learned Advocate appearing on behalf of the assessee in Tax Appeal Nos.814 and 815 of 2018 has also stated and submitted that the learned Tribunal ought to have kept appeals pending rather than disposing the appeals with above liberty.
7. In view of the above an

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M/s. TVS Motor Company Limited, rep. by its Authorized Signatory Versus The Assistant Commissioner, CGST and Central Excise, Hosur, The Commissioner of Central Goods and Services Tax, Salem And The Union of India, rep. by its Secretary, Ministry of Finance, New Delhi
GST
2018 (9) TMI 371 – MADRAS HIGH COURT – 2018 (16) G. S. T. L. 17 (Mad.)
MADRAS HIGH COURT – HC
Dated:- 9-7-2018
Writ Petition No. 16984 of 2018 And WMP. No. 20237 of 2018
GST
MR. T. S. SIVAGNANAM, J.
For The Petitioner : Mr. R. Parthasarathy for M/s.Lakshmi Kumaran & Sridharan Associates
For The Respondents : Mr. V. Sundareswaran, SPC
ORDER
Mr. V. Sundareswaran, learned Senior Panel Counsel accepts notice for the respondents. Heard both. By consent

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Tax Act, 2017 is illegal and arbitrary and has been passed in violation of the principles of natural justice. It is also submitted that the the first respondent has only made a decision by denying the transitional credit, which the petitioner is statutorily entitled to under Section 140(1) of the said Act.
4. The learned counsel for the petitioner submits that on facts, the petitioner has got an excellent case and when a notice was issued on 04. 1. 2018 to reverse the credit, within 24 hours, the petitioner submitted a reply dated 04. 1. 2018, followed by another reply dated 20. 1. 2018 wherein the petitioner relied upon certain decisions and contended that Since Section 140(1) of the said Act talks about carry forward of CENVAT credit bal

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said Act.
6. The respondent states that the impugned order is only a show cause notice. This Court is unable to agree with the said stand taken by the learned Senior Panel Counsel appearing for the Revenue, as a show cause notice cannot pre-judge the issue. Had the first respondent issued a notice calling upon the petitioner to state as to why the transitional credit claimed by them cannot be granted or should be directed to be reversed, then it would be a different matter. However, in the impugned proceedings, the first respondent denied the credit and all that has been granted is 15 days' time to reverse the credit, which, according to the first respondent, is inadmissible. These are sufficient grounds to hold that the impugned orde

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M/s. Dev Indus Paints rep. by its Proprietor K. Revathy Versus The Commissioner (CT), Commercial Taxes Department And The Deputy Commercial Tax Officer
GST
2018 (9) TMI 683 – MADRAS HIGH COURT – 2019 (20) G. S. T. L. 45 (Mad.)
MADRAS HIGH COURT – HC
Dated:- 9-7-2018
Writ Petition No. 17029 of 2018 & WMP. No. 20280 of 2018
GST
Mr. T. S. Sivagnanam J.
For the Petitioner : Mr.P.Suresh
For the Respondents : Mr.J.Kumaran, GA
ORDER
Mr.J.Kumaran, learned Government Advocate accepts notice for the respondents. Heard both. By consent, the writ petition itself is taken up for final disposal.
2. The petitioner has challenged a show cause notice dated 16.1.2018 and the consequential attachment of the bank account for recover

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have been passed in respect of the relevant years. The learned Government Advocate, on instructions from the officer, who is present in court, has informed that the assessment orders have not been passed in respect of all the three relevant assessment years. Then, there cannot be a demand notice nor there can be any attachment of the petitioner's bank account.
6. Accordingly, the writ petition is allowed, the impugned notice is set aside and Form U notice issued to the petitioner's banker is also set aside. Consequently, there will be a direction to the respondents to return the cheques collected from the petitioner. This direction shall be complied with within 3 days from the date of receipt of a copy of this order. After the cheq

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M/s. Suryadev Alloys and Power Pvt. Ltd. Versus Commissioner of GST & Central Excise Chennai Outer Commissionerate
Central Excise
2018 (9) TMI 900 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 9-7-2018
Appeal No. E/40356/2018 – Final Order No. 41954/2018
Central Excise
Ms. Sulekha Beevi C.S., Member (Judicial)
Ms. S. Yogalakshmi, Advocate for the Appellant
Shri R. Subramaniam, AC (AR) for the Respondent
ORDER
Brief facts are that the appellants who are engaged in manufacture of MS billets and TMT bars were availing the facility of CENVAT credit on duty paid on inputs, capital goods and service tax paid on input services. On verification of records, it was noticed that they had availed wrong credit to the tun

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n. She relied upon the judgment of the Hon'ble High Court of Madras in the case of Commissioner of Central Excise, Madurai Vs. Strategic Engineering (P) Ltd. – 2014 (310) ELT 509 (Mad.) and the decision of the Tribunal in the case of Bay Forge Ltd. Vs. Commissioner of Central Excise, Puducherry vide Final Order No.4 1766/2018 dated 11.6.2018.
3. The ld. AR Shri R. Subramaniam supported the findings in the impugned order.
4. Heard both sides.
5. It is brought out from the submission as well as from the records that the appellant had reversed the credit before utilization. Following the decisions relied by the ld. counsel, I am of the view that the demand of interest and the findings with regard to penalty cannot sustain. The impugned orde

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In Re: M/s. Membrane Filters (I) Pvt. Ltd.
GST
2018 (10) TMI 684 – AUTHORITY FOR ADVANCE RULING, MAHARASHTRA – 2018 (18) G. S. T. L. 156 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULING, MAHARASHTRA – AAR
Dated:- 9-7-2018
GST-ARA-06/2018-19/B-62
GST
SHRI B.V. BORHADE, AND SHRI PANKAJ KUMAR, MEMBER
PROCEEDINGS
(under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017)
The present application has been filed under section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MGST ACT”] by M/S/ Membrane Filters(l) Pvt Ltd., the applicant, seeking an advance ruling in respect of the following question.
“What is the rate & HSN code of GST applicable (after it's introduction from 1st July 2017) when Extracting water from tube well, passing it through treatment plant of removing unwanted contaminants like Iron fr

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nine districts in the State of Bihar.
Scheme is comprising of:
1) Drilling of tube well.
2) Solar panels & its system to run the pump, and take the water through treatment plant and reach water to 5.95 overhead tank at 7 meter height
3) Iron Removal treatment plant
4) Mild Steel Staging (Steel Structure) for supporting overhead tank of 5000 Litre capacity & enthusing treatment plant
5) RCC plinth
6) Prefabricated GI Sheet enclosure
7) Distribution line of GI pipes for house to house connections of Size 80 mm 40 mm
8) Automatic multiport valves operating on battery that is charged through solar energy
9) House to house connections
Nature & scope of work:
It's an assembly work involving drilling of tube well, construction of civil plinth at site, supply of pre-fabricated structure, Iron removal treatment plant and the solar system comprising of solar panel, its mounted steel structure, Battery operation to run the night light for security and operate the treat

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s) are given for setting up of the drinking water treatment plants meant for human and animal consumptions and in the interest of the Citizen of the country.
Now we seek your guidance on what is the rate & HSN code of GST is applicable (after it's introduction from 1st July 2017) when Extracting water from tube well, passing it through treatment plant of removing unwanted contaminants like Iron from ground water and eventually lifting it to overhead tank (in short the scheme) runs on solar power. Our technology has been not only vetted but recognized as one of the innovation by department of Rural Drinking Water through a wing of CSIR-GOI in the year 2015 and published through the Compendium of Innovative Technologies.
Issues Involved as on date:
The contract is issued by Public Health Engineering Department (PHED) of Bihar Government and till now (30h June 2017) they have been deducting VAT against each of supply and the work carried out and we have been filing VAT returns in

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is the rate & HSN code of GST is applicable (after its introduction from 15 July 2017) when Extracting water from tube well, passing it through treatment plant of removing unwanted contaminants like Iron from ground water and eventually lifting it to overhead tank (in short the scheme) that is not only simply assembled at site Where it is a composite sully and assemblies done at Site including their interconnections and the drinking water scheme works purely on SOLAR POWER.
Following explanation clearly spell out that the total supply has been in two parts with sub items where SOLAR POWER is the pivot point since the scheme works only when there is solar power. SO also each sub system is billed separately and each item is paid separately based on its completion and final bill is paid once the scheme is commissioned. We have attached detailed explanation with the kind of billing that is carried out at each item and each sub assembly work
Nature of Work,
Design, Construction, Supply

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operating on battery that is charged through solar energy
1.9425
9.
House to house connections… 100 nos
1.75
Nature & scope of work:
It's supply, erection and commissioning of a house to house drinking water supply schemes being installed in rural part of villages in the state of Bihar. These schemes operate of a specially developed technology and it exclusively work only on SOLAR POWER. Purchase of the items are done in the form of composite supply where each sub-assembly is supplied and the assembly work of various sub-assemblies and thereafter integration of such sub-assemblies together is done at site in a rural village allotted by the local Govt.
Tube Well:
A tube well is dug in the ground and thereafter PVC pipes are inserted and assembled in the tube well by putting gravel around the pipes with strainer assembly at the bottom end of the tube well. Thereafter flushing of the tube well is done by an air compressor to ensure smooth supply of water flowing out. Once

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a day or two at site and the finally 5000 Litre PVC tank is kept of the top of the structure. Foundation bolts get tightened provided on the Civil structure.
It's purely assembly work done at site by our own trained and employees
4. G I Sheet enclosure assembly en-housing treatment plant:
This is assembly and fixing of GI Sheet around the bottom part of steel structure in which assembly of treatment plant is carried out. This is also a screwdriver technique used since there is no electricity available to carry out such work.
Payment of this item is also done once assembly work is carried out at site.
5. Solar Panel Assembly: Designing and engineering of Solar system is one of the specialties of this technology and such large size of panels are assembled and interconnected once the structure is ready. Once this is done on the top of the Structure, safety railing taken to site in prefabricated manner are assembled using appropriate Size of nuts and bolts as seen in above pictu

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work is based on innovative design, engineering and each of the item is engineered and pre-fabricated in the factory and taken to the site and in a particular sequence it is assembled and the entire work is simplified to make it screwdriver technology and simply assembled at site. Since it is having interconnections with individual sub-assemblies and all such subassemblies are finally connected, it is treated as composite supply and the water supply gets started house to house for drinking water. Such system work only on the solar power.
Submissions on 06.07.2018
We have conveyed you our plea & looking forward kind consideration on the following lines that will help to serve to the masses “safe drinking water” using INNOVATIVE solutions.
1. Reaching safe drinking water to the bottom of the pyramid of our society.
2. Motivate Innovators and help innovations to exhibit its performance in the field &
3. Proving masses (society of our country) that Government is fully aware of such i

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the licensee of technology of Ultra Filtration membrane based on which we have been producing safe drinking filtration equipment which are very unique and cost effective in nature. The Finance Minister of Govt. of India in the year 2008 gave a special consideration by waiving of Excise duty for the filtration systems made out of such technology.
2. Subsequent innovation that we did based on our exhaustive experience in the field working, Department of Drinking Water & Sanitation through CSIR body recognize in the year 2015 as another innovation created by our team in the Company.
3. Benefit Of such innovative technology has reached to the poorest of poor in the country and that too in rural part of India in recent past.
4. These Compact Drinking water schemes are NON RO base (NON REVERSE TECHNOLOGY BASE) solution which are absolutely cost effective and such schemes are being implemented through joint funding of State & Central Government of India.
5. Central Government till date h

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ot find appropriate GST tax.
10. Our humble request has been just not to find somehow a place and squeeze in such technology under one of the OLD prevailing laws and give somehow a treatment and close the chapter but to find unique justice to such innovative solutions.
11. Our submission is to bring such INNOVATIONS to the kind attention of apex bodies of GST regime like yours that will give justice and motivate the innovators in the country.
Statement containing the applicant's interpretation of law and/or facts, as the case may be, in respect of the questions(s) on which advance ruling is required
In our opinion do assembly of various parts of which one of them is manufactured by us. The main item which makes this product fit for marketing is Solar Panel which is the costlier item amongst all parts So this assembly is a composite supply and product is dependent on Solar Panel.
Solar Panel should be applicable to the entire assembly
03. CONTENTION – AS PER THE CONCERNED OFF

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enefit of Notification of service tax if an availed.
25/2012-service Tax dated 20.06.2012
5] (A) classification of service/services as applicable.
Centrifuges, including centrifugal dryers, filtering or purifying machinering & apparent, for liquids for filtering, or purifying water, household filters etc.
(b) Rate of service tax as applicable to services provided.
12.36%
Details of benefits of notification of central excise tax if availed.
 
6] Copies of Advance ruling applications/orders if any obtained you under the provisions of central excise or service to the sales tax & there presents status in your company related company or sister concern.
Form GST ARA-01, Advance Ruling
7] Copy of show cause Notice/ Adjudication orders in respect of central Excises or service tax if any issued during the last five years, in case of your company related company or sister concern.
No.
8] Cases of violation of central excises/ services tax if any booked during last five years.
N

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al authority, State or central government in relation to the above-mentioned activity by a consultant or contractor is exempt from the GST.
2) Services provided in relation to the above-mentioned activity by the local authority, state or central government to the society/end-user shall also exempt from the GST.
3) Work contract services fall under the Composite supply and includes activity in relation to construction, erection, commissioning, installation, completion, fitting-out, repairs, maintenance, renovation, etc. Such activities Shall be subject to GST at a rate of 12 percent and shall become the cost of project to the local authority.
4) However rate of GST will become “nil” when the value of goods supplied under the Work contract services shall not exceed more than 25 percent of the total value of work contract services.
5) Any other construction services shall be chargeable at a rate of 18 percent.
6) Imported equipment and plant required for setting-up drinking water

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curement of domestic equipment and plant for setting up a water project is subject to tax at a rate of 18 percent. This Will lead to overall increase in the capital expenditure cost for the client.
2) Under the old tax system, counter vailing duty (CVD) and Special additional duty (SAD) were exempted on the imported equipment and machinery required for water projects. The water project falls under category of “project imports” and special privilege was given by way of exemption from tax by the government. Under GST regime, however, any import under Project import category shall be subject to tax at a rate of 18 percent. This will lead to overall increase in the capital expenditure cost for the client.
3) Services provided in relation to the construction, erection, commissioning, installation, completion, fitting-out, repairs, maintenance, renovation or alteration, etc., are now subject to GST at a rate of 12 percent in general. However, under the old tax regime construction services

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o becomes cost at the time of procurement of goods – cement, steel, etc -from traders instead of manufacturers by the contractors for the purpose of construction works. Due to the change in tax regime there is marginal increase in the cost saving available to the contractor and client. GST is a new born baby which replaces a 60-year-old tax regime in India. Once the Act becomes more mature with clearer understanding, the entire industry is going to benefit from the new tax regime. The Indian Government is currently refining the GST Act and, on the basis of industry representation, lots of amendments have been made in the last six months. On a positive note, we can expect that over time the overall cost for the infrastructure projects will decline.
HSN Code
Description
Rate (%)
Effective From
Cess (%)
Related Export/Import HSN Code
2201
Water (other than aerated, mineral, purified, distilled, medicinal, ionic, battery, demineralized and water sold in sealed container]
NIL
28/0

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sions made by the applicant and the department.
From the submissions made by the applicant we find that the issue pertains to a contract entered into by the applicant with the Public health Engineering Department, Government of Bihar. Vide letter dated 31.10.2014, the Executive Engineer of the Public health Engineering Department, Purnea, Bihar had informed the applicant that their bid in respect of their tender for the work of “Design, Construction, Supply and Commissioning of 200 Mini Piped Water Supply Schemes with solar powered pumps and suitable treatment plants (aeration and activated carbon based) for removal of excessive iron from the Iron affected habitations of 9 districts viz……. on TURNKEY basis with 3 months trial runs after commissioning and comprehensive of 60 months after successful completion of trial run period” had been approved.
Thus from the same it is clearly seen that the applicant has been awarded a contract for supply of water after removal of excess iron

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ies are carried out with the help of nuts. Prefabrication is done in the factory using standard steel structures and as per engineering carried out in each of the component and only final assembly is carried out at site and the finally a 5000 Litre PVC tank is kept on the top of the structure. Foundation bolts get tightened provided on the civil structure.
G I Sheet enclosure assembly en-housing treatment plant: This consists of assembly and fixing of GI sheet around the bottom part of steel structure in which assembly of treatment plant is carried out.
Solar Panel Assembly: Large size Solar panels are assembled and interconnected once the structure is ready. Once this is done on the top of the structure, safety railing taken to site in prefabricated manner are assembled using appropriate size of nuts and bolts.
Treatment plant: This is also pre-fabricated in their factory as per design and assembled at site as per the drawings. This is connected with interconnecting piping and CPVC

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ntract. Here it would not be out of place to mention that the applicant is claiming that the work performed by them are 'water treatment schemes' and not 'water purification schemes'. In their submissions they have mentioned that “…..when Extracting waterfront tube well, passing it through treatment plant of removing unwanted contaminants like Iron from ground water and eventually lifting it to overhead tank (in short the scheme)…..”. These works would be covered under Sr. No. 3, Column 3 (iii) of Notification No. 11/2017-Centra1 Tax (Rate) dated 28.06.2017.
In view of the above discussions and also in view of the submissions made by the applicant, we find that the work done by them is a composite supply which attracts the provisions of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017. The said Notifications has specified the rate of central tax to be levied on Intra State supply of services of description specified in Column 3 of the Table in the said

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……………….;
(c) pipeline, conduit or plant for (i) water supply (ii) water treatment, or (iii) sewerage treatment or disposal.
6
Provided that where the services are supplied to a Government Entity, they should have been procured by the said entity in relation to a work entrusted to it by the Central Government, State Government, Union Territory, or a local authority, as the case may be.
A plain reading of Sr. No. 3, clause (iii) reveals that 'composite supply of WCS supplied by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of, pipeline, conduit or plant for (i) water supply (ii) water treatment, or (iii) sewerage treatment or disposal attracts a tax rate of 6% each of CGST and SGST. However, the benefit of 12% tax rate would be available to the applicant only if the Works Contract services provided by them are Composite supply of works contract as defined in clause (119) of section

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In Re : Ismail Ahamad Soofi
GST
2018 (11) TMI 1012 – AUTHORITY FOR ADVANCE RULING – MAHARASHTRA – 2018 (19) G. S. T. L. 546 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULING – MAHARASHTRA – AAR
Dated:- 9-7-2018
GST-ARA- 05/2018-19/B-61
GST
SHRI B.V. BORHADE, AND SHRI PANKAJ KUMAR, MEMBER
PROCEEDINGS
(Under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017)
1.1 The present application has been filed under section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MGST Act”] by ISMAIL AHAMAD SOOFI (CHEFS CORNER), the applicant, seeking an advance ruling in respect of the following question.
Whether the catering services provided by the Applicant under B2B Model and B2C Model are to be classified as canteen/restaurant services under Entry. No. 7(i) of the Notification No. 11/2017 dated 28th June 2017 as amend

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plicant enters into contract with companies for providing catering services to its employees by following either Business to Business (B2B) Model or Business to Consumer (B2C) Model.
2.3 Under B2C Model, the Applicant enters into contract with the companies to provide catering services to the employees of the companies. In such type of the contracts, the amount of consideration is paid by the employees directly to the Applicant as per the agreed schedule, which is generally on monthly basis. All the risk with respect to the excess food is borne by the Applicant.
2.4 Under B2B Model, the Applicant enters into contract with the companies to serve food and beverages to the employees of the companies in the cafeteria designated within the companies' premises. In this model, the food is directly served by the Applicant to the employees of the companies. In such type of the contracts, the amount of consideration is paid by the companies directly to the Applicant as per the agreed sched

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y obligation to provide canteen services to its employees. Under such circumstances, the companies/institutions outsource the activity of running the canteen to the third-party service providers, like the Applicant.
2.9 Presently, the Applicant treats the catering services provided by it under B2C Model as canteen/restaurant services under Entry. No. 7 (i) of Notification No. 11/2017 dated 28th June 2017 as amended by the Notification No. 46/2017- Central Tax (Rate) dated 14th November 2017 and discharges GST at 5% cumulatively (CGST & SGST). For the catering services provided by it under B2B Model, the Applicant treats it as outdoor catering services under Entry 7 (v) of the abovementioned Notification and discharges GST at 18% cumulatively (CGST & SGST). However, given the absence of clarity in the area of catering services, the Applicant would like to seek an advance ruling whether the catering services provided by it under both the Models would amount to supply of canteen/restaura

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rvice Tax regime, the Revenue has accepted the Applicant's contention that it's business is covered under the definition of 'canteen service' and is not a 'outdoor catering' service.
A.1 The Applicant submits that the revenue authorities have already accepted the contention of the Applicant that the services provided by the Applicant squarely fall under the definition of “canteen service”. In this regard, the Applicant refers to the dispute raised by the department under the Service tax regime.
A.2  Under the Service Tax regime, the Applicant was, inter-alia, engaged in providing services in relation to serving of food or beverages to the employees of Lear Automotive India Pvt. Ltd., in the canteens maintained within the factory premises of Lear Automotive at Bhosari and Chakan. Both the factories of Lear Automotive (Bhosari and Chakan) are covered and are operating in accordance with the statutory requirements contained under the Factories Act, 1948. The

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) a license to serve alcoholic beverages.”
A.4 It is further submitted that the legislature never intended to grant benefit of exemption to air-conditioned restaurants, but because of this entry, the exemption was being availed by such restaurants.
A.5 To give effect to the legislative intent, an amendment was made to Entry No. 19 vide Notification No. 3/2013-ST dated 01.03.2013. The amended Entry No. 19 reads as follow:
“19. Services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess, other than those having the facility of air-conditioning or central air-heating in any part of the establishment, at any time during the year.”
A.6 After the said amendment was carried out in Entry No. 19 of the said Notification, the wrongful availment of service tax exemption was stopped, but due to this, the canteens in the factories established as per the Factory Act,1948 and having air-conditioning/central air-heating facility was unable to avail benefi

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. 6,63,926/- for claiming the refund of service tax paid by it on the services in relation to serving of foods and beverages provided at the canteen maintained in the factory of Lear Automotive in Form-R under Section 11B of the Central Excise Act, 1944.
A.9  However, the refund claim of the Applicant was rejected by the Ld. Assistant Commissioner (Refund), Service Tax, Pune Commissionerate vide his Order-in-Original No. R/693/2015-2016 dated 21.03.2015 on the ground that the Applicant is not eligible for exemption under the aforesaid notifications since they are not available for 'outdoor catering services'.
A.10 The Applicant then filed an appeal against the above-referred OIO dated 21.03.2015 on various grounds. The appeal was decided by the Ld. Commissioner, Service Tax, (Appeals), Pune vide his Order-in-Appeal No. PUN-SVTAX-000-APP-195-16-17 dated 23.08.2016 (Attached herewith as Annexure-1). The issue involved in the appeal was whether canteen services provided by

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f whether, the exemption could be provided to the Applicant under Entry No. 19A of Notification No. 25/2012-ST (as amended by Notification No. 14/2003-ST), it was held that the Applicant fulfilled both the conditions as stated under:
a) Of serving food at a canteen which is maintained in a factory covered under Factory Act, 1948
b) The canteen has an air-conditioned facility.
A.12 In light of the above, the Ld. Commissioner (Appeals) held that the Applicant's canteen facility at the Chakan unit was eligible for exemption under the Entry No. 19A of Notification No. 25/2012-ST (as amended by Notification No. 14/2003-ST).
A.13 The Applicant respectfully submits before the advance ruling authority that in light of the above discussion it is clearly understood that the issue of whether the Applicant is providing canteen services has been settled in favor of the Applicant and stands settled under the previous regime. The OIA dated 23.08.2016 has categorically held that the services p

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under serial no. 7(i) of the Notification No. 11/2017 -Central Tax(Rate) dated 28.06.2017 (hereinafter referred to as the “rate notification”) (reproduced at para B.9) and therefore it should be given the same treatment.
A.17 The OIA dated 23.08.2016 has been accepted by the Department in so far as no appeal has been filed against the same by the Department. Therefore, it is clearly understood that the Department has accepted the contention of the Applicant that the services provided by the Applicant are in the nature of 'canteen' services only and the same cannot be classified as 'outdoor catering' services.
B. The nature of the services provided by the Applicant has remained the same under the GST regime and therefore the services provided by the Applicant will be considered as 'canteen' service even under the GST regime and the Department cannot contend to the contrary.
B.1 The Applicant submits that the nature of services provided by the Applicant has re

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e or in any other manner, whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash deferred payment or other valuable consideration.”
B.4 Further, the rates for the supply of services were notified vide the rate notification. Serial No. 7 of the above-referred notification notified the rate for services provided by a canteen and outdoor caterer. The relevant paras of the said notification read as follows
Sl No.
Chapter, Section or Heading
Description of Service
Rate (per cent.)
Condition
7
 
 
 
 
 
 
Heading 9963 (Accommodation, food and beverage services)
 
 
 
 
(i) Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or drink, where such supply or service is for cash, deferred payment or other valuable

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ink (whether or not alcoholic liquor for human consumption), as a part of such outdoor catering and such supply or service is for cash, deferred payment or other valuable consideration.
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B.5 The above notification was amended by the Central Government vide its Notification No. 46/2017- Central Tax(Rate) dated 14.11.2017 wherein the item nos. (i) was substituted as following:
Sl No.
Chapter, Section or Heading
Description of Service
Rate (per cent.)
Condition
7
 
 
 
 
 
 
 
 
Heading 9963 (Accommodation, food and beverage services)
 
 
 
 
 
 
 
 
“(i) Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or drink, where such supply or service is for cash, deferred payment or other valuable consideration, provided by a restaurant, eating joint including mess, canteen, whetherfor consumption

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ght to be taxed at 5% (2.5%+2.5%) provided the supplier has not availed any ITC in respect of the same. In this regard, attention is also invited to entry at Serial No. 7(v) of the rate notification which specifies that the services provided in the nature of 'outdoor catering' services are taxable at the rate of 18% (9%+9%).
B.7 Thus, it is imperative at this juncture to identify as to whether the services provided by the Applicant fall under the category of services covered by Serial No. 7(i) or Serial No. 7(v) of the rate notification and the taxability of the said service will be determined accordingly.
B.8 In this regard, the terms 'Restaurant', 'Canteen', 'Outdoor catering', 'Caterer” are not defined under GST law. For better understanding and clarity, we will refer to the dictionary meaning of these terms and other interpretative aids. In this regard, reference is made to the following definition of canteen as given under various dictionaries

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squarely falls under the definition of canteen services. The Applicant submits that in most of the cases it is involved in cooking the food and beverages at the factory premises and the same is supplied to the employees of the clients for a consideration. whereas in some cases, the Applicant prepares the food elsewhere at a central kitchen facility and further the same to the client's premises for further supply to the employees of the factory.
B.10 Therefore, the Applicant squarely falls under the Serial No. 7(i) of the rate notification and is eligible to collect tax at the rate of 2.5% subject to the conditions mentioned therein.
B.11 The contention of the Applicant is further clarified by the plain reading of the Circular No. 28/02/2018-GST dated 08.01.2018 read with corrigendum issued vide Circular No. 28/02/2018 dated 18.01.2018. The aforesaid circular while clarifying the taxability of mess facility provided in educational institutions stated that the supply of food or be

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ged on goods and services used in supplying the service has not been taken, effective from 15.11.2017.”
B.12 The above corrigendum supports the contention of the Applicant that if food or drinks are supplied in a mess or canteen by anyone other than the institution, college or the company itself then the same is taxable at the rate of 5% provided no ITC has been taken on the goods and services used in supplying the said service. It is pertinent to note here that the above-referred circulars have used the example of education institutions only for clarificatory purposes and it is not the case here that the circular is restricted to only the mess or canteens operating in education institutions. Entry 7(i) of the rate notification includes all kinds of mess, canteens, restaurant and eating joints and is not restricted to the ones operational at the educational institutions.
B. 13 In this regard, the Applicant places reliance upon the sample agreements entered into with its clients namel

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y explained in the preceding paras that it is engaged in providing services which squarely fall under canteen services and the same are liable to be taxed accordingly. Further, in this regard the Applicant submits that the nature of services provided by the Applicant has not changed under the previous regime as well as the existing regime. The Applicant having satisfied that it provides canteen services should squarely fall under Entry 7(i) of the rate notification.
B. 15 In this regard, the Applicant submits that under the earlier law the Applicant was denied the exemption since the term 'canteen' was not mentioned under the relevant entry, however, the Entry No. 7(i) of the rate notification includes the term 'canteen' also and the therefore the same has to be construed accordingly. Further, the Department has also accepted the contention of the Applicant that it is engaged in providing canteen services and not outdoor catering services.
B. 16 Therefore, in light of

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39; service.
B. 18 Assuming, that the services provided by the Applicant contains elements of both 'outdoor catering' and 'canteen' services, the Applicant should be given the benefit of adopting the lower rate of tax. The Applicant submits that it is an established rule of law that when a particular service is capable of falling under two Categories, the assessee can adopt the classification beneficial to it.
B. 19 In this regard, the Applicant places reliance upon the decision of the Hon'ble Supreme Court in the case of Minwool Rock Fibers Ltd. [2012 (278) ELT 581 (SC)] wherein it has been clearly held that in a classification dispute if a particular good is capable of falling under two competitive headings then the heading beneficial to the assessee should be adopted. The relevant portion of the said decision reads as under:
“13. We have already noticed the relevant entries to which we are concerned with in this appeal. No doubt there is a specific entry which

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also specific heading like a heading based on commercial nomenclature. Therefore, we are of the view that the goods in issue are appropriately classifiable under Subheading No. 6807.10 of the tariff entry.”
B.20 Applying the ratio of the above case to the facts of the present matter, it is clearly understood that in case the Applicant's services fall under both the categories of 'outdoor catering' as well as 'canteen' then the same should be classified under the category of 'canteen' services as the same is beneficial for the Applicant. Accordingly, the present services are liable to be taxed at the rate of 5% as per the Serial No. 7(i) of the rate notification.
B 21 In this regard, reliance is also placed upon the case of Share Medical Care vs Union of India [2007 (209) E.L.T. 321 (S.C.)], wherein the Hon'ble Supreme Court held in clear terms that in a case where the applicant is entitled to benefit under two different Notifications or under two diffe

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n claiming exemption under category 3 of the notification is illegal and improper. The prayer ought to have been considered and decided on merits. Grant of exemption under category 2 of the notification or withdrawal of the said benefit cannot come in the umy of the applicant in claiming exemption under category 3 if the conditions laid down thereunder have been fulfilled. The High Court also committed the same error and hence the order of the High Court also suffers from the same infirmity and is liable to be set aside.”
…Underlining Supplied
B. 22 Similarly, the Applicant submits that since the tax rate of 5% is a benefit given to the services falling under the Serial No. 7(i) of the rate notification, the same should be extended to the services provided by the Applicant also by adopting the principle of beneficial interpretation.
C. The Advance ruling passed in the case of Rashmi Hospitality Services Pvt. Ltd, is not applicable in the present case
C.1 At this juncture it is pe

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ority finally held that the supply of services by Rashmi Hospitality Services Pvt. Ltd. is covered by Sr. No. 7(v) of the Notification No. 11/2017- Central Tax (Rate) as outdoor catering, attracting GST @18%. In this regard the Ld. Advance ruling authorities had relied upon the decision of the Hon'ble Allahabad High Court in the case of Indian Coffee Worker's Co-op Society Ltd. reported at [2014 (34) STR 546 (All.)].
C.3 The Hon'ble Allahabad High Court in the above-mentioned case had held that activities of providing food, beverages (alcoholic or non-alcoholic) or crockery and similar articles for any purpose or occasion which are provided at a place other than his own provided to him by way of tenancy or provided by the recipient will – fall under the category of 'outdoor catering services' as defined under the Section (65) (76a) read with Section 65(24) of the Finance Act, 1994.
C. 4 The Applicant submits that the above-referred Advance Ruling passed by the Guj

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ase of Indian Coffee Workers (supra) which is not applicable to the facts of the present case. The Hon'ble Allahabad High Court in the aforementioned case had held that it is immaterial as to who is the recipient of the service while determining whether a particular service is outdoor catering service or not. The Applicant submits that in light of the corrigendum issued vide the Circular No. 28/02/2018 dated 18.01.2018 (reproduced at para B.11) it is clearly established that the determination of a supplier and recipient of service is an important factor while deciding whether the service provided falls under the category of mess or canteen, under the GST law.
C.8 Thus, the decision of the Allahabad High Court passed in the context of Service Tax law cannot be relied upon in light of the conflicting principles. In light of the same, the aforesaid ruling cannot be relied upon in the present case since the same follows the principle laid down in the Indian Coffee Workers decision whi

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s upon the Applicant since the consideration is paid by the employees and the same is not covered by the client company. However, the Allahabad High Court decision in the above case has not considered the possibility of the present services falling under the category of 'restaurant' service and hence the said decision is not applicable in the present case.
C.11 Thirdly, the Applicant submits that the above ruling is not applicable in the present case insofar as it has failed to examine or decide the applicability of the Circular No. 28/02/2018 dated 18.01.2018 in the facts of the case. It is humbly submitted that the Circular No. 28/02/2018 dated 18.01.2018 is important to consider in the facts involved in the present case and the aforesaid ruling having failed to consider the same suffers from judicial infirmity and the same cannot be relied upon the decide the present case.
D. Without prejudice to the above, the Applicant submits that the B2C services provided by it are squ

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eople pay to sit and eat meals that are cooked and served on the premises.' The meaning of the term 'Canteen' is given in the above referred Dictionary as 'a restaurant in a workplace or educational establishment.'
D.4 According to the above referred dictionary meaning, the term Restaurant means the place where people pay for dining out in the premises where the food is cooked and served. Furthermore, the term canteen means a restaurant (i.e. a place where people sit and eat meal) which is attached to a factory, school etc.
D.5 Similar to the services provided in a restaurant, the Applicant has pre-fixed menu which cannot be altered by the consumer i.e. the employee. Further, the food and beverages are supplied at the place and time which are not decided by the consumer just like any restaurant.
D.6 Thus, the Applicant submits that the services provided by it are akin to a restaurant service and the same should be taxed accordingly. In light of the above, the App

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he aforesaid agreement).
D.8 In this regard, the Applicant wishes to further make a reference to the above agreement wherein the predecided menu is attached as Annexure-D to the agreement dated 23.03.2018. It is clear from the perusal of the same that the employees are provided restaurant services as they cannot alter the menu or personalise it to their own choice.
D.9 In the present case, the recipient of the services (i.e. the employees) would have a limited choice of menu to select the meal from. Also, apart from the standard level of servicing, the employees would not be in position to demand for customization, personalization of the services from the Applicant. Therefore, it can be concluded that Applicant is providing the restaurant services to its employees under B2C model and the same is not covered by outdoor catering services.
QUESTIONS REQUIRING ADVANCE RULING
The question on which Advance Ruling is sought by the Applicant is as under:
The recent amendment made in the N

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in the Concise Oxford English Dictionary as a place where people pay to sit and eat meals that are cooked and served on the premises.' The meaning of the term 'Canteen' is given in the above referred Dictionary as a restaurant in a workplace or educational establishment.'
C.2 Some of the Dictionary meanings of the word 'canteen' are as under:
* A restaurant provided by an organization such as college, factory, or a company for its students or staff (ref: www.oxforddictionaries.com')
* A restaurant attached to a factory, school, etc. providing meals for large number of people (ref: www.colinsdictionary.com')
* A place in a factory, office,etc. where food and meals are sold, often at a lower than usual price (ref: www.dictionary.cambridge.org)
C.3 Therefore, the canteen is understood to be a place, generally in an organization or institute such as factory, school, etc. where meals are provided. Therefore, to constitute a canteen it is important tha

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selves or is outsourced to a third person. Supply of food or drink provided mess or canteen is taxable at 5% without Input Tax Credit Serial No. 7(i) of notification No. 13/207 7-CT (Rate) as amended vide notification No. 46/2017CT (Rate) dated 14.11.2017 refers). It is immaterial whether the service is provided by the educational institution itself or the institution outsources the activity to an outside contractor.”
…………….Emphasis Supplied.
C.6 The abovementioned Circular provides that the supply of food or drink provided by a mess or canteen to the students and staffs are to be classified under 5% category of catering services irrespective of such services being provided by the educational institution itself or is outsourced to an outside contractor.
Also, to further clarify, a Corrigendum to the above circular was issued on 18.01.2018. The relevant extract of the Corrigendum to the Circular is given below:
” In Para 2 of the said circular, for
“It is immaterial wheth

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is Supplied.
C.7 Therefore, from the above Circular, it is amply clear that the catering services provided by anyone other than the educational institutions (i.e. an outdoor caterer) to the students, staff, etc. of the education institution, is to be treated as canteen' services as covered under Entry No. 7(i) of Notification No.11/2017 – CT (Rate) and would attract 5% GST cumulatively (CGST & SGST).
C.8 In view of the above submissions, the Applicant has analysed the catering services provided by it under both the Models, as follows:
B2C Model
C.9 The Applicant submits that the catering services by it under B2C Model involves supply of food or drinks to the employees in the canteen established in the premises of the companies/institutions. Under this Model, the Applicant recovers the charges for supply of food or drinks from the staff/employees.
C.10 On reading and applying the meaning of the term “canteen' and also the Circular to the Applicant's B2C Model, the Appli

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ons, the nature of services remains to be canteen services and not otherwise.
D ISSUES RELATING TO ADVANCE RULING AND APPLICANT'S UNDERSTANDING.
Question
D. 1 Whether the catering services provided by the Applicant under B2B and B2C Models are to be classified as canteen services?
Applicant's Understanding
D.2 Based on the above discussions and keeping in mind the dictionary meaning of the term 'canteen' and the Circular No. 28/02/2018-GST dated 08th January 2018, the Applicant is convinced that the supply of catering services provided by it to the employees of the companies/ institutions under both the Models are to be classified under Entry.No. 7 (i) attracting 5% GST (both CGST & SGST), irrespective of whether the consideration is received from the employees or from the companies.
03. CONTENTION – AS PER THE CONCERNED OFFICER
The submission, as reproduced verbatim, could be seen thus-
1. Question on which Advance Ruling is required –
Whether the catering ser

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ed with the companies premises In this model ,the food is directly served by the Applicant to the employees of the companies. The amount of consideration is paid by the companies directly to the Applicant as per the agreed schedule.
Under both the Models, the food is prepared either in the kitchen located in the companies' premises or in the 'centralized kitchen located outside the companies' premises.
Presently, the Applicant treats the catering services provided by it under B2C Model as canteen/restaurant services under Entry No.7(i) of the Notification No.11/2017 dated 28 th June 2017 as amended by the Notification 17- Central Tax (Rate) dated 14 th November 2017 and discharges GST at 5% cumulatively (CGST & SGST) For the catering services provided by it under B2B Model, the Applicant treats it as outdoor catering services under Entry No. 7(v) of the above mentioned Notification and discharges GST at 18 % cumulatively (CGST & SGST). The Applicant would like to seek an

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v) of the said Notification. The Entry No.7(v) of the above mentioned Notification is as follows. “Supply, by way of or as part of any service or in any other manner whatsoever in outdoor catering wherein goods, being food or another article for human consumption or any drink (whether or not alcoholic liquor for human consumption), as a part of such outdoor catering and such supply or service is for cash, deferred payment or other valuable consideration.”
As the Applicant is providing Outdoor Catering services, the amended Notification No.46/2017- Central Tax (Rate) dated 14 th November 2017 is not applicable to the Applicant. The Applicant is liable to pay GST at 18% cumulatively (CGST & SGST) on outdoor catering services provided by him as per Entry No.7(v) of the above mentioned Notification No.11/2017 dated 28th June 2017.
Under Service Tax Regime, The expression “caterer' is defined in clause (24) of Section 65 of the Finance Act 1994 as follows:
“Caterer' means any per

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05) (zzt) read with clauses (24) and (76a) of the Finance Act, 1994.
04. HEARING
4.1 The case was taken up for preliminary hearing on dt. 16.05.2018, with respect to admission or rejection of the application nobody was present from the side of applicant. The jurisdictional officer, Sh. Y. A. Lokre, Dy. Commr. of S.T.(PUN-VAT-E-603), Pune appeared and made written submissions.
4.2 The application was admitted and final hearing was held on 26.06.2018 , Sh. Sandeep Sachdeva, Advocate along with Sh. Nirav Karia, Advocate appeared and made oral and written submissions as per their ARA. Sh. Sandeep Sachdeva, Advocate requested for grant of further two weeks time for making some more written submissions which is considered and they were requested to make submissions as desired latest by 09.07.20187 without fail. The jurisdictional officer, Sh. A. Lokre, Dy. Commr. of S.T.(PUN-VAT-E-603), Pune appeared and stated that they have already made written submissions.
05. OBSERVATIONS
5.1 We hav

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a centralized kitchen located outside the company's premises, (b) companies may provide utensils, electricity, equipment, furniture, pest control services etc. depending on the contract, (c) they have to maintain cleanliness in the canteen and in most of cases, a Canteen Committee set up by the Company will inspect the quality standards of materials, food items to be supplied in the canteen and (d) the food rates are as per the contract between the company and the applicant.
5.5 We find that at present they are treating catering services provided under B2C Model as canteen/ restaurant services under Entry. No. 7 (i) of Notification No. 11/2017 dated 28th June 2017 as amended and are paying GST at 5% cumulatively (CGST & SGST). Under B2B Model, they are treating such catering services as outdoor catering services under Entry 7 (v) of the abovementioned Notification and are paying GST at 18% cumulatively (CGST & SGST).
5.6 We find that there is no doubt in the applicant's mind

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tsoever, of goods, being food or any other article for human consumption or drink, where such supply or service is for cash, deferred payment or other valuable consideration, provided by a restaurant, eating joint including mess, canteen, neither having the facility of air-conditioning or central air-heating in any part of the establishment, at any time during the year and nor having licence or permit or by whatever name called to serve alcoholic liquor for human consumption.
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(ii) Accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes ……………………
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(iii) Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink, where such supply or service is for cash, deferred payment or other valuable consideration, provided by a restaurant, eating joint including mess, ca

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ation in hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff ……….
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(vii) Supply, by way of or as part of any service or in any other manner whatsoever, of goods, including but not limited to food or any other article for human consumption or any drink (whether or not alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration, in a premises (including hotel, convention center, club, pandal, shamiana or any other place, specially arranged for organising a function) together with renting of such premises.
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(viii) Accommodation in hotels including five star hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff …………..
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(ix) Accommodation, food and beverage services other tha

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ocated in the premises of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff of any unit of accommodation of seven thousand five hundred rupees and above per unit per day or equivalent. Explanation.- “declared tariff” includes charges for all amenities provided in the unit of accommodation (given on rent for stay) like furniture, air conditioner, refrigerators or any other amenities, but without excluding any discount offered on the published charges for such unit.
2.5
Provided that credit of input tax charged on goods and services used in supplying the service has not been taken [Please refer to Explanation no. (iv)].
5.8  We find, from the submissions made by the applicant, that the provisions of clause (ii), (iii), (vi), and (vii) of the above mentioned Notification do not apply to the current facts in hand. Therefore the issue before us is to ascertain whether the activities of the applica

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mention post the amendment. Hence it can be inferred that the said clause post the amendment made considers outdoor catering as a Supply, by way of or as part of any service, of goods, being food or any other article for human consumption or any drink, at Exhibition Halls, Events, Conferences, Marriage Halls and other outdoor or indoor functions that are event based and occasional in nature.
5.11 Since the supply of catering services provided by the applicant cannot be considered to be in the nature of “outdoor catering”, we shall now discuss whether the activities of the applicant would fall under Sr. No. 7, Headings 9963(i) of the above referred Notification. To understand whether the activity of the applicant as claimed is 'canteen services' we would be required to examine as to what a canteen is.
5.12 We find that word “canteen” as per Cambridge English Dictionary is “a place in factory, office, etc. where food and meals are sold often at a lower than usual price”.
“A pl

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urnable basis in good and proper condition. Also, generally water and electricity is also provided by the company on chargeable or maybe non chargeable basis.
(3) Some or all of the food, snacks or tea and coffee may be cooked or prepared in the canteen itself.
(4) The items are sold to the employees directly by the contractor at agreed prices which are mostly subsidized and the sale amounts are collected by the contractor themselves. However prepaid meal vouchers may also be given to employees by the company which are to be accepted by the contractor.
(5) The contractor may be required to serve to employees by counter service or even table service in respect of senior officials of the company.
(6) The company communicates to the contractor only approximate estimated quantity consumption it does not guarantee any quantity which may vary on a daily basis.
(7) The contractor can generally sell additional items with the approval of canteen management, company management and rates of

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TOR' that the Contractor shall ensure that the food is cooked and carried from outside and no food item is prepared in the company premises using gas/electricity or otherwise. RMSL has under the contract assured the applicant of a minimum of 370 lunch meals. RMSL shall provide space, fixtures, fittings equipment, etc.
5.15 In their contract with CTI, it is again clearly seen from a reading EXHIBIT A to the agreement/contract that the location of the Kitchen of the applicant is at a distance of about 7 kms from the CTI plant and therefore it appears that the food is cooked and carried from outside and sold in CTI's premises. Here too it is seen that the applicant has been provided with space, utensils and other equipments, crockery, cutlery, water, electricity, cleaning of cafeteria, etc. Menu is also dictated by CTI in general.
5.16 In their contract with TCS, from a reading of para 13 of Annexure A to the contract/agreement it is seen that the food is cooked at some main kit

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oning or central air-heating in any part of the establishment, at any time during the year, as the applicant has not clarified the same anywhere. The said clause (i) has been amended by Notification No. 16/2017 as “”(i) Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or drink, where such supply or service is for cash, deferred payment or other valuable consideration, provided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the premises where such food or any other article for human consumption or drink is Supplied, other than those located in the premises of hotels, inns, guest houses, club, campsites or other commercial places meant for residential or lodging purposes having declared tariff of any unit of accommodation of seven thousand five hundred rupees and above per unit per day or equivalent. Explanation.- “declared tariff” includes charges

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held hereinabove, we pass an order as follows :
ORDER
(under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017)
NO.GST-ARA- 05/2018-19/B-61                                  Mumbai, dt. 09.07.2018
For reasons as discussed in the body of the order, the questions are answered thus –
Question :- Whether the catering services provided by the Applicant under B2B Model and B2C Model are to be classified as canteen/restaurant services under Entry. No. 7(i) of the Notification No. 11/2017 dated 28th June 2017 as amended by the Notification No. 46/2017- Central Tax (Rate) dated 14th November 2017 or as outdoor catering services under Entry. No 7(v) of the said Notification?
Answer : In view of the observations and discussions made above the activity undertaken by the appl

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In Re: M/s. INA Bearings India Private Limited
GST
2018 (12) TMI 226 – AUTHORITY FOR ADVANCE RULING, MAHARASHTRA – 2019 (20) G. S. T. L. 465 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULING, MAHARASHTRA – AAR
Dated:- 9-7-2018
GST-ARA-04/2018-19/B-60
GST
SHRI B.V. BORHADE, AND SHRI PANKAJ KUMAR, MEMBER
PROCEEDINGS
(Under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017)
The present application has been filed under section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MGST Act”] by INA Bearing India Private Limited, the applicant, seeking an advance ruling in respect of the following question.
a) Whether the sale of goods, which are located outside India, would be liable to tax in India under section 7(5) (a) of Integrated Goods and Services Tax Act, 2017?
b) If answer to (a) is yes, then whether th

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ngs and tools. The Applicant supplies bearings to a wide range of customers which inter-alia include Original Equipment Manufacturers (OEM).
* It is pertinent to note that for manufacture of bearings for specific customer, a specific type of tool is required. These tools are developed basis the requirements of the customers. Using these specially designed tools, child parts are manufactured and supplied to our customer. Typically, while entering into a contract for supply of bearings, the customer issued two purchase orders viz:
* PO NO. RNAIPL/2013(B4A/PTVT/230 dated 13.09.2013 for supply of tools and
* PO No. RN15-MP-113W-K316 dated 28.05.2015 for supply of tappets.
* The Applicant in-turn raised a purchase order on Scaheffler Technologies AG & Co. KG (for the purpose of brevity herein after referred as “Scaheffler Germany”) for supply of tools. The tools which are required for manufacturing is developed outside India by Scaheffler Germany. Once the tool was developed, Sc

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physically moving goods from Germany would make the transaction liable to GST in light of provisions of 3-ection 7(5)(a) of Integrated Goods and Services Tax Act, 2017 (IGST Act, 2017) and will the Applicant be required to charge IGST on the tools sold to its customer in India.
* If IGST is applicable on the transaction under consideration, then whether Applicant's customer would be eligible to avail the input tax credit of IGST charged by the Applicant.
The Applicant is making detailed submission herein below to demonstrate why IGST should not be applicable on the transaction under consideration.
Statement containing the applicant's interpretation of law and/or facts. as the case may be. in respect of the questions(s) on which advance ruling is required
A. Levy of IGST cannot be extended beyond territorial jurisdiction of the said legislation.
Evaluating IGST provisions to understand possibility of levying IGST
A1. With reference to facts of the applicant summarized in Annex

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Place of supply
Supplier – IGST Act has not separately defined the term 'supplier' and hence the definition of CGST Act can be adopted in terms of section 2(24) of IGST Act, Section 2(105) of CGST Act defines 'supplier' as “supplier in relation to any goods or services shall mean the person supplying the said goods or services and shall include an agent acting as such on behalf of such supplier in relation to the goods or services or both supplied”
Accordingly, in case of T2 in question, tool is supplied by Applicant to customer even if there is no movement of tool and hence, Applicant would be construed as 'Supplier'.
Place of Supply – Section 10 of IGST Act provides for various scenarios to determine the place of supply of goods. In case of T2, the supply does not Involve movement of goods, Hence. without prejudice to Applicant's submission herein below, it appears that the said supply would get covered under section of IGST Act which is reproduced below:
“10. (1) The place of s

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ndia. Hence, the said transaction could get covered under the ambit of Inter-state supply' in terms of section of IGST Act.
A4. IGST would be levied on all inter-State supplies of goods or services or both in terms of Section 5 of IGST Act. From the conjoint reading of abovementioned provisions, it appears that T2, could get covered within the purview of 'Inter-State supply' and hence could become liable to IGST.
A5. However, Applicant intends to draw your kind attention to section 1(2) of IGST Act which determines the extent of applicability of IGST Act. As per the said section IGST Act extends to whole of India except State of Jammu and Kashmir. 'India' has been defined in section 2(56) of CGST Act read with section 2(24) of IGST Act to mean 'the territory of as referred to in article 1 of the Constitution, its territorial waters, seabed and sub-soil underlying such waters, continental shelf, exclusive economic zone or any other maritime zone as referred to in the Territorial Water

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n India. In order for section to come into play, the place of supply should be outside India and to determine the place of supply the provisions of Section seems to be relied on. The Applicant contends that the provisions of GST are travelling beyond its powers by stating that for the transaction under question where the goods are lying outside India i.e. in Germany, the place of supply shall be outside India. Hence, the Applicant pleads it is outside the jurisdictional powers of the GST law to determine the place of supply for goods when such goods are not located in India.
A8. Given the aforesaid, the tax cannot be said to be payable on the transaction under consideration as the subject i.e. goods (tools), on which tax is payable in outside India i.e. beyond the jurisdictional extent of IGST Act, 2017.
B. Tax cannot be demanded on the said transaction as the collection. if at all tax is leviable, itself will be unconstitutional
B1. It is no more res-integra that no tax shall be co

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r that Article 269A enables levy and collection of GST for supplies in the course of inter-state trade of commerce. An explanation has been inserted stating that import transactions will also be considered as inter-state supply of goods or services or both. If we consider the common parlance an inter-state transaction would mean transaction effected between two states and or union territories. It would be important to note that the Constitution has not defined the above transaction that is, where the supplier is located in India and the place of supply is outside India to be an inter-state supply. The provisions of section 7(5)(a) is ultra vires since the law has defined a specific transaction to be an inter-state supply without having adequate powers to do So. Since the Constitution of India has neither defined such transactions to be an inter-state transaction nor given powers to determine so, the provisions ought to be treated as ultra-vires.
C. Cross-border transactions are being

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xtent and unless it is covered under territorial jurisdiction of IGST Act.
C2. Applicant wishes to draw your kind attention to proviso to section 8 which states that following supply of goods shall not be treated as intra-State supply –
(i) Supply of goods to or by a Special Economic Zone developer or a Special Economic Zone unit;
(ii) Goods imported into territory of India till they cross the Customs frontiers of India; or
(iii) Supplies made to a tourist referred to in section 15
The above mentioned list has been excluded from ambit of 'intra-State supply” so that administrative and Jurisdictional powers would vests with Central Government and not State Government.
C3. In view of above submission, Applicant contends that section should be read only to exclude such transactions from the purview of State Government and said section should not be considered as piece of legislation which is empowering Central Government to travel beyond territorial jurisdiction and levy IGST on

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ion 7(5)(a) of IGST Act but not covered under section 16 of IGST Act would be considered as liable to IGST.
D5. The terms 'Export' covers the cases of taking goods out of India, however, principally even tool being supplied to customer at d location outside India should get covered under the purview of term 'Export'. Interpreting the term 'Export' to only cover supplies where goods are taken out of India would be restrictive and would disregard the principle of consumption based tax. 'Export of goods' should be interpreted in a broader way to cover such cross-border transaction where goods are delivered to a customer outside India even if not taken from India. Restricting the concept of export only to cases involving movement from India would mean disregarding the fact that place of supply is outside India. Thus, Applicant pleads for extending the meaning of 'export of goods' even to cases where goods are delivered to customer outside India even if not taken from India.
D6. Assuming

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eates place of supply of service between the cases where location of both supplier and recipient is in India as against cases where either of the party is located outside India. Whereas in case of goods, place of supply is to be determined in terms of section 10 or 11 of IGST Act which provides for determining place of supply separately for domestic supplies and for export/ import transactions.
E2. Your kind attention in this regard, is invited to proviso to section 12(3) of IGST Act, 2017, which provides that in case of supply of service in relation to immovable property is outside in India and if both the supplier and recipient are in India then the place of supply shall be the location of recipient.
E3. For your reference we have reproduced relevant portion of section 12(3) of IGST Act, 2017
(3) The place of supply of services,
(a) directly in relation to an immovable property, including services provided by architects, interior decorators, surveyors, engineers and other related

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nbsp;E4. It can be observed from the aforesaid provisions that there is specific provision in case of services wherein it is specifically provided that the place of supply shall be the location of immovable property, however, if both the supplier and recipient are in India and location of immovable property is outside India then the place of supply for the purpose of GST will be location of recipient of service.
E5. Similar provisions were provided in Rule 8 of Place of Provision of Services Rules, 2011 under Service Tax regime. We have reproduced the said provisions below:
'8. Place of provision of services where provider and recipient are located in taxable territory
Place of provision of a service, where the location of the provider of service us well us that of the recipient of service in the faxable territory, shall be the location of the recipient of service.'
E6. It can be observed that in case of services the legislatures have always specifically provided for levying tax

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e levy and collection of tax will be only at the time of importation of goods in India i.e. when import declarations are filed before Customs Authorities for customs clearance for the first time.
F2. The relevant para of the circular is reproduced below'
'4. GST Council has de liberated on the levy of Integrated Goods and Services Tax on high sea sales in the case of imported goods. The council has decided that 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 Customs authorities for the customs clearance purposes for the first time. Further, value addition accruing in each such high sea shall form part of the value on which IGST is collected at the time of clearance.'
F3. The Circular clearly mentions that the tax is leviable only at the time of importation of goods in India and not when the goods the sold while they are in High Seas. Si

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GST returns to mention the Place of Supply in case of these transactions
G1. A taxpayer is required to report all the transactions carried out by him in his GST returns i.e. GSTR-1 and GSTR-2. Further, the supplier of goods and/ or services has to mention State code of place of supply for each invoice in the GSTR-1 while reporting the outward supply.
G2. Without prejudice to the aforesaid, even if the transaction is made taxable in GST, the place of supply, in accordance with section of IGST Act, 2017, is outside India, There is no mechanism in the GST returns to report the transaction in GSTR-1 mentioning the place of supply to be a place outside India. Accordingly, the collection mechanism of such IGST is unclear and consequently it is unclear as to whether only Central Government or both Central and State Government would receive this revenue.
G3. In the absence of ambiguity around collection mechanism and revenue sharing of such GST, it appears that intention of legislatures w

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as amended to bring the same in line with provisions of GST law. Also, that Parliament is empowered to formulate the principles to determine when the supply is said to be made outside the State or in the course of import or export. However, no such principles have been formulated till date for GST.
H4. The levying section 6 of GST Act provided that CST shall be levied on all inter-State sale of goods. Similar to GST, CST Act specifically defined inter-State supplies, sale in the course of import, sale in the course of export and intra-State sale out of which only inter-State sale was made liable to CST.
H5. Section 5 of CST Act, 1956 provided for the principles to determine whether the transaction is a sale or purchase in the course of import or export and the same are reproduced below:
(1) A sale or purchase of goods shall be deemed to take place in the course of the export the goods out of the territory of India only if the sale or purchase either occasions such export or is effec

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der European VAT Laws
I1. Applicant wishes to draw your kind attention to the fact that in case of supply of tools by INA Germany to Applicant, EUVAT is leviable since the goods are located in Germany at the time of supply.
I2. As per Article 31 of EU VAT Law the place of supply of goods which does not involve dispatch or transfer of goods, shall be the place where goods are located at the time of supply. We have reproduced the said provisions below”:
'Article 31
Where goods are not dispatched or transported, the place of supply shall be deemed to be the place where the goods are located at the time when the supply takes place.'
I3. It can be observed from the aforesaid provision of EU VAT that the place of supply for the transaction under consideration will be Germany and has already attracted EU VAT. Hence, the same should not be made liable to GST in India. Levying GST on such transaction in India would lead to supply to same tools being taxed in Germany as well as in India.

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/ or services.
J3. The relevant provisions of section 16 of CGST Act, 2017 is reproduced below:
(2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless,
(a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribed;
(b) he has received the goods or services or both.
Explanation.-For the purposes of this clause, it shall be deemed that the registered person has received the goods where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise
(i) where the goods are delivered by the supplier to a recipient or any other person on the direction

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th tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his output tax liability, along with interest thereon, in such manner as may be prescribed:
Provided also that the recipient shall be entitled to avail of the credit of input tax on payment made by him of the amount towards the value of supply of goods or services or both along with tax payable thereon.
 J4. Without prejudice to the aforesaid submission, if at all tax is payable on the transaction under consideration then the recipient of supply should be eligible to avail input tax credit of the supply made to him and the condition of receipt should be deemed to have been complied with by applying explanation to section 16(2)(b) of CGST Act, 2017.
J5. The Applicant contends that if a transaction is held to be liable qua the supplier and not the goods or services or both, then

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of IGST Act, 2017 since, the intention behind section 7(5) (a) was to specifically provide that export or import of goods and/or services should be treated as inter-state transaction and not to tax the transactions under consideration.
2. If at all the transaction is made taxable, the recipient should be eligible to avail the input tax credit.
03. CONTENTION – AS PER THE CONCERNED OFFICER
The submission, as reproduced verbatim, could be seen thus-
Question raised.
(a) Whether the sale of goods, which are located outside India would be liable to tax in India u/s 7(5) (a) of IGST Act 2017?
Explanation:
As per section 7(2) of IGST Act 2017 which is reproduced below:
Supply of goods imported into the territory of India, shall be treated to be a supply of goods in the course of inter-state trade or commerce.
In this case goods doesn't move into the territory of India. Hence IGST Act will not apply in this case.
Also section 10 of IGST Act provides for various scenarios to determ

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. Accordingly, without prejudice to Applicant's submission herein below, the place of supply would be location of goods at the time of delivery i.e. outside India.
Thus in this type of transaction IGST will not be leviable u/ s 7(5) (a) of IGST Act (i.e. when the supplier is located in India and the place of supply is outside India)
04. HEARING
The case was taken up for preliminary hearing on dt. 16.05.2018, with respect to admission or rejection of the application when Shi Nitin Shah, Advocate, Sh. Niraj Menon, C.A., and Sh. Anant Joshi, Manager Taxation appeared and requested for admission of application as per their contentions in ARA application. The jurisdictional officer, Shi Y. A. Lokre, Dy. Commr. Of ST. (PUN-VAT-E-610), Pune appeared and made written submissions.
The application was admitted and final hearing was held on 26.06.2018, Sh. Nitin Shah, Advocate, Sh. Niraj Menon, C.A., and Sh. Anant Joshi, Manager Taxation appeared and made oral and written submission as per t

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pplicant have two purchase orders as below:
a. PO No. RNIAIPL/2013/B4A/PTVT/230 dated 13.09.2013 for supply of tools and
b. PO No. RN15-MP-113W-K316 dated 28.05.2015 for supply of tappets.
In order to comply with purchase orders received by the applicant, applicant in turn places purchase orders for manufacture of tools on M/ s. Schaeffer Technologies AG & CD. KG, Germany (for the purpose of brevity herein after referred as “Scaheffler Germany”). The tools which are required for manufacturing are developed outside India by Schaeffer Germany. Once the tools are developed, Schaeffer Germany raise an invoice on applicant at Pune and as corollary of this the ownership of the said tools get transferred to the Applicant, without physical movement of tools from Germany to India i.e. the tools continue to remain in the possession of Scaheffler Germany. It means that there is no transfer of goods [Tools] in physical form and the Tool remain under the possession of Schaeffer Germany. The Ap

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following attributes:
1. Levy of IGST cannot be extended beyond territorial jurisdiction of the said legislation.
2. Tax cannot be demanded on the said transaction as the collection, if at all tax is leviable, itself will be unconstitutional.
3. Cross-border transactions are being covered under 'Inter-State supply' only to exclude the same from purview of State Government, however, that would not conclude IGST applicability unless authorized.
4. The term 'Zero-rated supply' should be read in liberal manner and should not be restricted only to taking of goods outside India.
5. Place of Supply of Service specifically covers case where recipient is located outside India, unlike Place of Supply of Goods
6. Circular issued for High Sea Sales will be applicable to the transaction under consideration.
7. To state code available in GST returns to mention the Place of Supply in case of these transactions
8. The transaction was not taxable under erstwhile indirect tax laws and henc

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find that the applicant would be purchasing from Schaeffer Germany, who is a manufacturer on principal to principal basis. The ownership of the said goods get transferred to the applicant without any physical movement of the goods from Germany to India. However the goods remain in the possession of Schaeffer Germany. Once the first transaction takes place applicant transfers the ownership of the goods to Indian customer by way of sale. In this case also the goods remain under the possession of Schaeffer Germany. In short, the order received by the applicant from their customer in India and the order placed by applicant On Schaeffer Germany is in the nature of back to back order.
On the basis of the above set facts we would be required to refer to the provisions of IGST Act, 2017. First of all to confirm the nature of supply of present goads i e. whether inter-state or intra-state we are required to refer to Chapter IV of the IGST ACT, 2017, which reads as under:-
CHAFTER IV DETERMINA

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te trade or commerce.
Intra-State supply.
8. (1) Subject to the provisions of section 10, supply of goods where the location of the supplier and the place of supply of goods are in the same State or same Union territory shall be treated as intra-State supply:
Provided that the following supply of goods shall not be treated as intra-State supply, namely:
(i) supply of goods to or by a Special Economic Zone developer or a Special Economic Zone unit;
(ii) goods imported into the territory of India till they cross the customs frontiers of India; or
(iii) supplies made to a tourist referred to in section 15.
From the reading of Section 7(2) of the IGST Act We find that Supply of goods imported into the territory of India till they cross the customs frontier shall be treated as supply of goods in the course of inter-state trade or commerce.
In addition to what is stated above we find that the location of the applicant as a supplier of goods is in India and the place of supply of g

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dations of the Council and collected in such manner as may be prescribed and shall be paid by the taxable person:
Provided that the integrated tax on goods imported into India shall be levied and collected in accordance with the provisions of section 3 of the Customs Tariff Act, 1975 on the value as determined under the said Act at the point when duties of customs are levied on the said goods under section 12 of the Customs Act, 1962.
(2) The integrated tax on the supply of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel shall be levied with effect from such date as may be notified by the Government on the recommendations of the Council.
(3) The Government may, on the recommendations of the Council, by notification, specify categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shal

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rator does not have a physical presence in the taxable territory, any person representing such electronic commerce operator for any purpose in the taxable territory shall be liable to pay tax:
Provided further that where an electronic commerce operator does not have a physical presence in the taxable territory and also does not have a representative in the said territory, such electronic commerce operator shall appoint a person in the taxable territory for the purpose of paying tax and such person shall be liable to pay tax.
From the transactions placed by the applicant before us there is no doubt that the goods of the applicant would be imported goods if they are brought from outside the country into India and it is clear that when the location of the supplier is in India and the said goods are delivered/ supplied from a place outside India to a place outside India, these goods have not crossed the customs frontiers of India, thus clearly the transaction in these goods are in the na

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Section 50) Of the IGST Act it is very clear that in respect of imported goods into the territory of India there is no levy and collection except in accordance with the provisions of Section 12 of the Customs Act, 1962 and Section 3 of the Custom Tariff Act, 1975. Section 12 of the Customs Act, 1962 provides that custom duties which includes integrated tax in respect of imported goods would be levied only at the time of import or export of goods.
Thus in case of goads supplied on an out an out basis as is in the present case, there is no levy till the time of their customs clearance in compliance with Section 12 of the Customs Act and Section 3 of the Customs Tariff Act. In view of this the imported goods sold from and to a non-taxable territory, though they are clearly in the nature of inter-state supply would come in the category of “exempt supply” as no duty is leviable on them except in accordance with proviso to Section 5(1) of the IGST Act.
We find that in the definition of exe

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ct, 1975.
We find that the above legal position is further reiterated and confirmed by Circular No. 3/1/2018-IGST dated 25.05.2018 issued by the Central Board of Indirect Taxes and Customs, GST Policy Wing.
6. In view of the extensive deliberations as held hereinabove, we pass an order as follows:
ORDER
(Under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017)
NO.GST-ARA-04/2018-19/B-60
Mumbai, dt. 09/07/2018
For reasons as discussed in the body of the order, the questions are answered thus –
Question:-Whether the sale of goods, which are located outside India, would be liable to tax India under section 7(5) (a) of Integrated Goods and Services Tax Act, 2017?
Answer: – Answered m the Negative.
Question: – If answer to (a) is yes, then whether the recipient, to whom such goods are sold, be eligible to avail input tax credit of such goods?
Answer: not relevant in view of answer to Question No. 1 above.
Case

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Lavgan Dockyard Private Limited Versus Commissioner of CGST, Kolhapur
Service Tax
2019 (1) TMI 1303 – CESTAT MUMBAI – 2019 (27) G. S. T. L. 539 (Tri. – Mumbai)
CESTAT MUMBAI – AT
Dated:- 9-7-2018
APPEAL NO: ST/85884/2018 – A/88290/2018
Service Tax
Mr. S.K. Mohanty, Member (Judicial)
Shri Jay Chadha, C.A. for appellant
Shri Dilip Shinde, Assistant Commissioner (AR) for respondent
ORDER
Per: S.K. Mohanty
This appeal is directed against the impugned order dated 30.11.2017 passed by the Commissioner of Central Excise (Appeal-I), Pune.
2. Brief facts of the case are that the appellant is engaged in providing various taxable services, defined under the Finance Act, 1994. For providing the taxable services, the appel

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t amounting to Rs. 1,22,737/- was disallowed and the appellant was directed to pay interest on such disallowance amount of Cenvat Credit. Besides, the adjudication order also imposed penalty under the provisions of Rule 15 (3) of the Cenvat Credit Rules, 2004 read with sub-Section (1) of Section 78 of the Finance Act, 1994. On appeal, the Learned Commissioner (Appeals) vide the impugned order dated 30.11.2017 has upheld the adjudged demand confirmed on the appellant.
3. Heard both sides and perused the records.
4. In this case, the appellant had availed Cenvat Credit of service tax paid on insurance service for insuring it employees. The definition of input service contained in Rule 2 (l) of the Rules specifically excludes life insurance

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vice sustains.
5. I find that the irregularly availed Cenvat Credit had not been used/utilized by the appellant for payment of service tax on the output services provided by it. In absence of utilization of Cenvat Credit, it cannot be said that there is loss of revenue to the Government exchequer, which can be compensated by way of payment of interest. Further, the Cenvat Credit particulars availed by the appellant were reflected in the books of accounts, which were verified by department for confirming the adjudged demand. Since the appellant had not suppressed any material particulars with regard to availment of Cenvat benefit, I am of the view that the provisions of Rule 15 (3) read with sub-Section (1) of Section 78 of the Act cannot b

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Gst Refund
Query (Issue) Started By: – Vinay Jaindani Dated:- 8-7-2018 Last Reply Date:- 9-7-2018 Goods and Services Tax – GST
Got 4 Replies
GST
Dear Sir, As per notification no. 40/2017 Central Tax Rate the merchant exporter can purchase goods at concessional rate of 0.10 percent from manufacturer exporter subject to certain condition including a condition which states:-
''the registered recipient shall indicate the Goods and Services Tax Identification Number of the registered supplier and the tax invoice number issued by the registered supplier in respect of the said goods in the shipping bill or bill of export, as the case may be'' my merchant exporter has not fulfiled the above condition because of which t

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custom house to be amended :
Provided that no amendment of a bill of entry or a shipping bill or bill of export shall be so authorised to be amended after the imported goods have been cleared for home consumption or deposited in a warehouse, or the export goods have been exported, except on the basis of documentary evidence which was in existence at the time the goods were cleared, deposited or exported, as the case may be."
Therefore you may request the proper office permission for amending the Bill of Export.
Reply By DR.MARIAPPAN GOVINDARAJAN:
The Reply:
My view is also on line with Shri Rajagopalan Sir,
Reply By YAGAY and SUN:
The Reply:
Section 149 of customs act is relevant in this matter.
Discussion Forum – Knowledge S

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Conference Sponsorship from Outside India
Query (Issue) Started By: – Ajay Sachdeva Dated:- 7-7-2018 Last Reply Date:- 6-8-2018 Goods and Services Tax – GST
Got 10 Replies
GST
We are proprietorship firm. We are organizing an international Conference at New Delhi next year ie Feb 2019. We are expecting to receive sponsorship for the same from some overseas companies. Do we need to charge them GST for the same?
Reply By DR.MARIAPPAN GOVINDARAJAN:
The Reply:
In my view GST is payable on reverse charge basis.
Reply By Ajay Sachdeva:
The Reply:
Does the reverse charge mean that we charge the client and they can claim back. How does it work?
Reply By DR.MARIAPPAN GOVINDARAJAN:
The Reply:
Under Reverse charge mechanism the servi

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by' your Indian firm and not against any 'services received' by it. This fact, therefore, makes your Indian entity a service provider rather than a service recipient.
It is interesting to note that sponsorship service is one category that has created doubts ever since its inception as to who is the service provider and who is the receiver of services. Please note that in case of sponsorship services, the provider is the person who 'receives the sponsorship money' and the person paying the money is 'service receiver'. Even technically, it is only a receiver of services (here sponsorship service in your case) who makes the payment (the foreign companies, in your case).
Therefore, RCM applicability is absolutely

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