2018 (5) TMI 649 – AUTHORITY FOR ADVANCE RULING – MAHARASHTRA – 2018 (13) G. S. T. L. 486 (A. A. R. – GST), [2018] 2 GSTL (AAR) 73 (AAR) – Scope of Supply – supply of such motor vehicles as scrap after its usage – Whether supply of such motor vehicles as scrap after its usage can be treated as 'supply' in the course or furtherance of business and whether such transaction would attract GST? – rate of GST and/or Compensation Cess.
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Held that: – The disposal of the scrap vehicles for consideration is a sale and section 7 explaining the expression 'supply' covers supply of goods such as sale or disposal made for a consideration. Section 7, further, says that the supply has to be in the course or furtherance of business – The disposal of the cash carrying vans is a transaction in connection with or incidental or ancillary to the business of having a cash management network. As and when the vehicles become scrap, they have to be disposed off and the proceeds therefrom to be identified
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e as such, the rate of the material sold as scrap would apply – In absence of the requisite details, the applicant are directed to go through the N/N. 1/2017-CentraI/State Tax (Rate) and N/N. 1/2017-Compensation Cess (Rate), as amended from time to time.
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Ruling:- The question is answered in the affirmative. As regards rate of GST and/or Compensation Cess, the details being inadequate, the applicant may refer to the Notification No. 1/2017-CentraI/State Tax (Rate) and Notification No. 1/2017Compensation Cess (Rate), as amended from time to time.
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Input tax credit – whether Input tax Credit is available to CMS Info Systems Ltd. on purchase of motor vehicles i.e. cash carry vans which are purchased, used for cash management business and supplied post usage as scrap? – Difference of opinion – Held that: – As the Members of the Advance Ruling Authority differ in respect of this question as raised by the applicant, appropriate reference is made to the Appellate Authority for Advan
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the answer to Question 1 is in affirmative, whether Input tax Credit is available to CMS Info Systems Ltd. ('CMS' or 'the applicant ) on purchase of motor vehicles i.e, cash carry vans which are purchased, used for cash management business and supplied post usage as scrap? At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / MGST Act would be mentioned as being under the "GST Act". 02. FACTS AND CONTENTION – AS PER THE APPLICANT The submissions, as reproduced verbatim, could be seen thus- "Statement of relevant facts having a bearing on the question(s) rais
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cles as scrap. In certain cases, instead of purchasing motor vehicles, the applicant prefers to hire these motor vehicles. Statement containing the applicant's interpretation of law and/or facts. as the case may be. in respect of the aforesaid ques tion(s) (i.e. applicant's view point and submissions on issues on which the advance ruling is sought): The applicant presents its interpretation of law for each of the above questions hereunder. The applicant hereby submits that each of the following submission is without prejudice to each other: Question 1 Whether supply of such motor vehicles as scrap after its usage can be treated as 'supply' in the course or furtherance of business and whether such transaction would attract GST? If yes, please provide the rate of GST and/or Compensation Cess. The applicant is supplying motor vehicles as scrap after using the same. Therefore, the issue raised is whether such transaction can be considered to be 'supply' in the eyes
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n, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit; (b) any activity or transaction in connection with or incidental or ancillary to sub-clause (a); (c) any activity or transaction in the nature of sub-clause (a), whether or not there is volume, frequency, continuity or regularity of such transaction; (d) supply or acquisition of goods including capital goods and services in connection with commencement or closure of business; (e) provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members; (f) admission, for a consideration, of persons to any premises; (g) services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation; (h) services provided by a race club by way of totalisator or a licence to book maker in such club ; and (i) any activity or transaction undert
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nd selling goods. the way you make a living or the act of exchanging or buying and selling something Commerce: Oxford Dictionary; "the activity of buying and selling, especially on a large scale " Cambridge dictionary: "the activities involved in buying and selling things From the above dictionary meanings, it appears that to consider something as business, it should be an 'activity' and not a stray transaction. There was a question raised before Ministry of Finance whether the activity of selling old gold jewellery by an individual supplier comes within the purview of 'supply'. Finance Ministry in their Press Release dated 13.07.2017 clarified as under: "Even though the sale of old gold by an individual is for a consideration, it cannot be said to be in the course or furtherance of his business (as selling old gold jewellery is not the business of the said individual). and hence does not qualify to be a supply per se. Accordingly the sale of gold je
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nput tax credit has been availed on such assets .. On analysing the above clause, it reveals that permanent transfer or disposal of business assets is also treated as supply. However, the important point to be noted is such transfer or disposal will be deemed to be supply only where input tax credit has been availed on such assets. Therefore, the disposal of cash carry vans should not be regarded as supply and no GST should be payable since the applicant is not in the business of selling cash carry vans and the applicant has not availed any input tax credit on such asset. Question 2 If the answer to Question 1 is in affirmative, whether Input tax Credit is available to CMS Info Systems Ltd. ('CMS' or 'the applicant') on purchase of motor vehicles i.e. cash carry vans which are purchased, used for cash management business and supplied post usage as scrap? In any case, if the stray transaction of sell of cash carry van is considered to be supply then the bar of taking inp
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rges of cash carry vans hired by them. If input tax credit can be claimed in respect of hire charges, on the grounds of equity, the credit should also be allowed on outright purchase of such vehicles. In the present case, if the stray transaction of sell of cash carry van is held to be supply then input tax credit shall be available to the Applicant in terms of exception provided in Section 17 (5) (a) of Central GST Act, 2017. SUBMISSION dt. 27.02.2018 There should not be additional inclusion of words while interpreting the provisions of a statute. The provisions must be construed strictly on the basis of plain language used by the legislature It is a well-settled principle of law that at first one has to apply "literal interpretation" and only in cases of absurd results, one has to apply "purposive interpretation. It is well settled law that while interpreting a statute the basic principle of literal rule of interpretation has to be followed. In light of the above submi
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2004 (8) TMI 389 – SUPREME COURT OF INDIA SUBMISSION dt.05.03.2018 Without prejudice to our application and submissions during the personal hearing; we Wish to add and submit as under with reference to query on Input Tax Credit available on purchase of Cash Vans used to transport cash and other valuable items from clients premises (usually banks)- l) As per Section 17(5) of the Central Goods and Services Tax Act, 2017 " (5) Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) motor vehicles and other conveyances except when they are used- (i) for making the following taxable supplies, namely:- (A) further supply of such vehicles or conveyances ; or (B) transportation of passengers; or (C) imparting training on driving, flying, navigating such vehicles or conveyances; (ii) for transportation of goods; (b) [Emphasis supplied] 2) The term "goods&quo
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Motor Vehicles Act, 1988 (59 of 1988); [Emphasis supplied] 3) In view of the above legal provisions, the applicant humbly submits as under – a. The applicant is owner of Cash Vans – these are dedicated vehicles which have been fabricated only for transportation of cash and other similar valuables. These vehicles are used by the Banks for transportation of cash and bullion; b. The Cash Vans are classified as 'Transport Vehicle" as per the Notification issued under sub-section (4) of section 41 of the Motor Vehicles act, 1988 (59 of 1988) dated the 19th June, 1992, (The Notification is attached herewith for your ready reference as Annexure 'A ); c. The Cash Vans if procured on or after 01st July, 2017 is chargeable to Goods and Services Tax; d. The Applicant on perusal of the provision of Law stated above wishes to claim Input Tax Credit paid on purchase of such vehicles based on following interpretation – As per provisions of Section 16 of the CGST Act – Every registered p
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n 2 which defines various terminologies under the Act-it stales "In this Act unless the context otherwise requires "Goods" includes all materials, commodities and articles. [Constitution of India. Act. 366(12)] Reference – Advanced Law Lexicon, P Ramnatha Aiyar's -4th Edition; – "Money" means a medium of exchange authorised or adopted by a domestic or foreign government as a part of its currency (English) Uniform Civil Code, 1978. S. 1-201 (24)] – Reference – Advanced Law Lexicon, P. Ramnatha Aiyar's 4th Edition; – Money is "that which passes freely from hand to hand throughout the community in final discharge of the debts and full payment for commodities; being accepted equally without reference to the character or credit of the person who offers it. and without the intention of the person Who receives it to consume it or apply it to any other use than In turn to tender it to others in discharge of debts or payment for commodities.: (per DARLING,
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e-way bill is required to be generated- (a) where the goods being transported are specified in Annexure; ANNEXURE [(See rule 138 (14)] Sr. No. Description of Goods (1) (2) … 6 Currency … The term 'currency' has been defined in the Foreign Exchange Management Act, 1999. The extract of the definition is reproduced herein below (h) "currency" includes currency notes, postal notes, postal orders, money orders. cheques, drafts, travellers cheques, letters of credit, bills of exchange and promissory notes credit cards or such other similar instruments as may be notified by the Reserve Bank; Accordingly, with reference to the above definition of the term currency, it may be noted that currency includes, inter alia, currency notes, cheques, draft. b. It is pertinent to note that the words used in the CGST rules are -'goods being transported". Thus, e-way bill is not required to be generated when currency is transported. It may be appreciated that in sp
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n 1 7 (5) of Central GST Act, 2017. In this regard, the applicant humbly submits that for the purposes of Section 17 (5) of Central GST Act, 2017, money shall be considered as 'goods' and therefore, input tax credit shall be available with respect to such cash carry vans. One of the conditions to issue 'C' form under the Central Sales Tax ('CST') Act, 1956 (i.e. to buy goods at a concessional rate of Central Sales Tax) is that the goods to be bought against cc' Form must be used for manufacturing or processing of 'goods'. Here, It would be worthwhile to take note of decision delivered by Hon'ble Supreme Court under the erstwhile Central Sales Tax ('CST') Act, 1956. In case of Printers (Mysore) Ltd. vs. Asstd. Commissioner Tax Officer 1994 SCC (2) 434 = 1994 (2) TMI 261 – SUPREME COURT OF INDIA (copy attached for your reference as Annexure the issue on hand was 'newspaper' was excluded from the definition or 'goods' under C
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purpose of taxability, 'money' is excluded from the definition of 'goods' whereas for the purpose of input tax credits, goods' would include 'money'. 6) Our case is more strengthened in light of the fact that cash carry vans are registered as 'goods carriage' under Motor Vehicles Act, 1988. The definition of 'goods' under Motor Vehicles Act, 1988 reads as under: "goods" Includes live-stock, and anything (other than equipment ' ordinarily used the vehicle) carried by a vehicle except living persons. but does not include luggage or personal effects carried in a motor car or in trailer attached to a motor car or the personal luggage of passengers travelling in the vehicle. On analysing the above definition, it can be observed that under Motor Vehicles Act, goods includes money and consequently, all cash carry vans of the applicant are considered as 'goods carriage' Therefore, though there is express definition given in Cent
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e applicant undertakes to transport gold and silver bullion, coins and ingots from various locations such as: – From airports to safe vaults of banks: When gold is imported from outside India, the applicant transports such gold bullion, coins, ingots from the airport/ port where importation takes place to the safe vault where it will be stored safely. – From one branch of the bank to another branch The applicant also transports gold, jewellery from one branch of the bank to safe vault where such gold is stored safely. Therefore, one needs to analyse Section 17 (5) of Central GST Act, 2017 in this factual matrix. The said Section is reproduced hereunder: Section 17 Apportionment of credit and blocked credits (5) Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) motor vehicles and other conveyances except when they are used- (i) for making the following ta
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Coins Transportation, – Secured Cash Vaulting as per RBI guidelines; – Bullion Management Extract of one such sample agreement between the applicant and Decium Financial Ltd. dated 16 August, 2016 (which is in operation till date) providing scope of services which includes bullion management, is attached herewith for your ready reference as Annexure 'C' , There is no dispute to the fact that gold and silver are nothing but goods. In common parlance, gold is not considered as money; but a commodity which is capable of being bought and sold. Accordingly, gold and silver are movable properties squarely falling within the definition of 'goods' Therefore, these cash carry vans are also used for transportation of gold and other valuable goods. Consequently, as per Section 17 (5) of Central GST Act, 2017, the input tax credit of CGST, MGST, IGST and Compensation Cess shall be available to the applicant. In view of the above, we request you to pass a suitable Advance Ruling st
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ity of such transaction; Therefore the activity of supply of vehicles as scrap after usage shall fall under the definition and scopes of supply comes under the definition of Business. (ii) Further it is also clear that the said activity is not covered under a negative list given under Section 7(2) and Schedule-III of CGST Act, activities or transactions which shall be treated neither as a supply of goods nor a supply of services. Schedule-III of the Act gives: – (i) Services by an employee to the employer in the course of or in relation to his employment. (ii) Services by any court or Tribunal established under any law for the time being in force. (iii). (a) the functions performed by the Members of Parliament, Members of State Legislature, Members of Panchayats, Members of Municipalities and Members of other local authorities; (b) the duties performed by any person who holds any post in pursuance of the provisions of the Constitution in that capacity; or (c) the duties performed by an
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les are sold as scrap then depending upon the material of which they are made, CGST rate and cess would be applicable accordingly, (4) With regards to the 2nd question Input Tax Credit on motor vehicles is not allowed as per Section (17) (5) of CGST Act as it clearly states that; Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) motor vehicles and other conveyances except when they are used- (i) for making the following taxable supplies, namely:- (A) further supply of such vehicles or conveyances ; or (B) transportation of passengers; or (C) imparting training on driving, flying, navigating such vehicles or conveyances; (ii) for transportation of goods; Since the applicant is engaged in cash management services and the same does not fall within exceptional cases as mentioned above including clause (ii) of Section 17(5) (a) because as per definition of go
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h, both Chartered Accountants, attended. On dt. 27.02.2018, Sh. Jayesh Gogri, and Sh. Manish Goel, Chartered Accountant attended alongwith Sh. Abraham Joseph (Associate Director (Taxation) and reiterated the contention as made in the written submission. Written submission was tendered during hearing and a request was made to make a further submission. The same has been tendered. None was present on behalf of the concerned officer from the Central Tax Office. However, a written submission has been furnished. 05. OBSERVATIONS We have gone through the facts of the case. Lt has been informed thus – The applicant is having cash management network pan India. Such transportation of cash is done through security vans popularly known as cash carry vans. The applicant purchases raw motor vehicles and with the requisite fabrications, gets it converted to cash carry vans. For this purpose, the applicant purchases motor vehicles and pays GST and also pays GST on fabrication. While purchasing cash c
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not it is for a pecuniary benefit; (b) any activity or transaction in connection with or incidental or ancillary to sub-clause (a); (c) any activity or transaction in the nature of sub-clause (a), whether or not there is volume, frequency, continuity or regularity of such transaction; (d) supply or acquisition of goods including capital goods and services in connection with commencement or closure of business; (e) provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members; (f) admission, for a consideration, of persons to any premises; (g) services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation; (h) services provided by a race club by way of totalisator or a licence to book maker in such club ; and (i) any activity or transaction undertaken by the Central Government, a State Government or any loc
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applicant is in the business of having a cash management network involving transportation of cash, The disposal of the cash carrying vans is a transaction in connection with or incidental or ancillary to the business of having a cash management network. As and when the vehicles become scrap, they have to be disposed off and the proceeds therefrom to be identified as income for the business which is reflected in the Profit & Loss Account of the business. Buying new assets and discarding the old and unusable assets is an activity in the course of carrying on of the business. Hence, we conclude that supply of such motor vehicles as scrap after its usage is an activity of 'supply' in the course or furtherance of business and such transaction would attract GST. However, we see that the applicant has referred to the following to make a claim that the impugned transaction would not be a 'supply' under the GST Act SCHEDULE I [see section 7] – ACTIVITIES TO BE TREATED AS SU
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from the fact that 'supply' in section 7 says that supply is one which is made or agreed to be made for a consideration. Therefore, Schedule I comes up with cases made exceptional for being treated as 'supply' for the reason that they lack the crucial element of 'consideration'. As regards Schedule IL the same classifies the supplies into supplies of goods or services. Schedule Il begins with the premise that the activities are 'supply'. For the facts before us, we find that there is a supply of cash vans, which are ' goods', for a consideration and the transaction is in the natural course of business. The transaction and the provisions are obvious. In view thereof, we do not find merit in the argument of the applicant. Having seen that the transaction amounts to a 'supply' under the GST Act, we move on to the next aspect which the applicant desires to know and which is the rate of GST and Compensation Cess. Chapter 87 of the Customs Tar
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ded from time to time) enlisting the goods exempted from GST does not cover the impugned cash carrying vans. 2. Notification No.1/2017-Central/State Tax (Rate) (as amended from time to time) enlisting the goods taxable to CST at various rates – a. Schedules I to III and V to VI do not cover the impugned goods. b. Entries in Schedule IV would cover the impugned goods. 3. Notification No.1/2017-Compensation Cess (Rate) (as amended from time to time) enlisting the goods taxable to Compensation Cess under the Goods and Services Tax (Compensation to States) Act, 2017 at various rates – a. This Notification enlists goods from the Chapter 87. In absence of the requisite details before us, we have to ask the applicant to go through the Notification No.1/2017-CentraI/State Tax (Rate) and Notification No. 1/2017-Compensation Cess (Rate), as amended from time to time. We would now turn to the next question. Question 2 If the answer to Question 1 is in affirmative, whether Input tax Credit is avai
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aking input tax credit (3) Where the registered person has claimed depreciation on the tax component of the cost of capital goods and plant and machinery under the provisions of the Income-tax Act, 1961 (43 of 1961), the input tax credit on the said tax component shall not be allowed. Section 17 – Apportionment of credit and blocked credits. (1) Where the goods or services or both are used by the registered person partly for the purpose of any business and partly for other purposes, the amount of credit shall be restricted to so much of the input tax as is attributable to the purposes of his business. (2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies incl
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ricks, moulds and dies, jigs and fixtures are supplied as scrap, the taxable person may pay tax on the transaction value of such goods determined under section 15. As can be seen from the above, except in certain situations as enumerated, ITC is not available in respect of motor vehicles. Hence, I see the exceptions. As can be seen, the impugned activity of providing cash management services not being for transportation of passengers OR for imparting training on driving, flying, navigating such vehicles or conveyances, it would not be covered by the exceptions in (B) and (C) of sub-section 5(a)(i). Sub-section 5(a)(i)(A) is about making "further supply of such vehicles or conveyances". The words "further supply" herein are m the nature of "resale". It should be noted that it is not mentioned as being just "supply of such vehicles or conveyances". The word "further" before the word "supply" has to be given its proper weightage.
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e. Here, the word 'further' has to be given the meaning as is intended by the Legislation. And I am convinced that there can be no other intention than the one as had by me. Then comes sub-section which speaks about exception if the motor vehicles are used for transportation of goods. The word 'goods' has been defined thus – "Definitions. 2. In this Act, unless the context otherwise requires,- (52) goods means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply; (75) money means the Indian legal tender or any foreign currency, cheque, promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance or any other instrument recognised by the Reserve Bank of India when used as a consideration to settle an obligatio
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rwise requires. Hence, here for the purpose of taxability, 'money' is excluded from the definition ofgoods' whereas for the purpose of input tax credits, 'goods' would include 'money'. The applicant has cited the case law in Printers (Mysore) Ltd. And Another V. Assistant Commercial Tax Officer And Others. (Civil Appeal No. 1550 of 1985). Indian Newspapers Society V. State of Karnataka. (Writ Petition No. 278 of 1991). (And Other Appeals) [93 STC 95]. We could look at the facts and the decision in this case thus – "The publishers of newspapers require various goods, here inafier referred to as "the raw material", for producing, i. e., for printing and publishing their newspapers. The publishers are registered as dealers under the Act. They purchase their raw material from other registered dealers. Most of these purchases are inter-State purchases; m the hands of the selling dealers they are inter-Stale sales exgible to tax. Section 8, read as
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ed by the purchasing dealer. In this certificate, the purchasing dealer mentions his registration certificate number and all other particulars including the statement that the goods being purchased by him are meant for being used, inter alia, in the manufacture or processing of goods for sale. Of declared goods, the selling dealer has to pay tax at the rate applicable to sale of such goods within the appropriate State.). It necessarily means that the selling dealer will collect (pass on) tax from the purchasing dealer only at the said concessional rate. The idea behind this provision is self-evident. It is to ensure that the price of the product manufactured by such purchasing dealers does not go up to the detriment of the consumers of those goods. The Parliament does not want to tax both the raw material and the finished goods at the full rate. Where the finished goods are meant for sale, the raw material utilised or consumed for the manufacture of said finished goods is taxed at the
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endment, the definition reads as follows: "'goods' includes all materials, articles, commodities and all other kinds of movable property, but does not include newspapers, actionable claims, stocks, shares and securities." ……………………… Now the situation is this: before the amendment of the definition of the expression "goods" by the 1958 Amendment Act, the publishers of the newspapers [who held the certificate of registration contemplated by section 8(3)(b)] were issuing forms "C" [declarations contemplated by section 8(4)(a)] and on that basis the selling dealer was collecting from them Central sales tax at the concessional rate of 4 per cent (in the case of non-declared goods). They were like any other manufacturers in this respect. But after newspapers were excluded from the purview of the "goods" by the 1958 (Amendment) Act, the Central sales tax authorities took the stand tha
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literal construction is adopted, it is conceded on all hands that the view taken by the Karnataka High Court is the correct one. But what the Madras and Kerala High Courts have done is to take the spirit behind the amendment of the definition of the expression "goods" as well as the scheme underlying entry 54 of List II read with entries 92 and 92-A of List I of the Seventh Schedule to the Constitution and hold on that basis that the expression "goods" occurring in the latter half of clause (b) of section 8(3) does not exclude newspapers from its purview [clause (b) of sub-section (3) : "The goods referred to in clause (b) of sub-section (1) are goods of the class or classes specified in the certificate of registration of the registered dealer purchasing the goods as being intended for resale by him or subject to any rules made by the Central Government in this behalf, for use by him in the manufacture or processing of goods for sale or in mining or in the gen
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t three occasions, there is no doubt, it has to be understood in the sense it is defined in clause (d) of section 2. Indeed, when section 8(1)(b) speaks of goods, it is really referring to goods referred to in the first half of section 8(3)(b), i.e., on first three occasions. It is only when section 8(3)(b) uses the expression "goods" in the second half of the clause, i.e., on the fourth occasion that it does not and cannot be understood in the sense it is defined in section 2(d). In other words, the "goods" referred in the first half of clause (b) in section 8(3) refers to what may generally be referred to as raw material (in cases where they were purchased by a dealer for use in the manufacture of goods for sale) while the said word "goods" occurring for the fourth time (i.e., in the latter half) cannot obviously refer to raw material. It refers to manufactured "goods", i.e., goods manufactured by such purchasing dealer-in this case, newspapers
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ontext does not permit it. It could never have been included by Parliament. Before the said amendment, the position was: the State could not levy tax on intra-State sale of newspapers; the Parliament could but it did not and entry 92-A of List I bars the Parliament from imposing tax on inter-State sale of newspapers; as a result of the above provisions, while the newspapers were not paying any tax on their sale, they were enjoying the benefit of section 8(3)(b) read with section 8(1)(b) and paying tax only at 4 per cent on non-declared goods which they required for printing and publishing newspapers. Their position could not be worse after the amendment which would be the case if we accept the contention of the Revenue. If the contention of the Revenue is accepted, the newspapers would now become liable to pay tax at 10 per cent on non-declared goods as prescribed in section 8(2). This would be the necessary consequence of the acceptance of Revenue's submission inasmuch as the news
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governs whenever that word or phrase is used in the body of the statute. But where the context makes the definition clause inapplicable, a defined word when used in the body of the statute may have to be given a meaning different from that contained in the interpretation clause; all definitions given in an interpretation clause are, therefore, normally enacted subject to the usual qualification-"unless there is anything repugnant in the subject or context", or "unless the context otherwise requires". Even in the absence of an express qualification to that effect such a qualification is always implied. 18. There is no dispute with the proposition that the meaning of a word or expression defined may have to be departed from on account of the subject or context in which the word had been used and that will be giving effect to the opening sentence in definition section, namely, "unless the context otherwise requires". In view of this qualification, the court
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; Thus, "currency" is goods where the goods being transported are specified in the Annexure in rule 138(14) of the CST E-Way Rules, the transportation of which would not require the generation of e-way bill. The rule stems from section 88 of the GST Act which requires that the Government may require the person in charge of a conveyance carrying any consignment of goods of value exceeding such amount as may be specified to carry with him such documents and such devices as may be prescribed. I find entry no.117 in the Notification no.2/2017-CentraI/State Tax (Rate) (as amended from time to time) specifying the Schedule for goods exempted specifying the goods "Rupee notes when sold to the Reserve Bank of India". Notes become legal tender after they are issued by the Reserve bank of India. Till that time they are mere printed papers and not 'money' or 'currency' and hence, they are held exigible to GST, though at a NIL rate. In the present case, the ITC
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the carriage of goods, or any motor vehicle not constructed or adapted when used for the carriage of goods,' (47) "transport vehicle " means a public service vehicle, a goods carriage, an educational institution bus or a private service vehicle; A goods carriage under the Motor Vehicles Act would transport goods and the definition of goods therein does not exclude 'money'. In view of all above, I observe that I am in agreement with the claim of the applicant that the word 'goods' in sub-section would not take colour from the definition of "goods" which excludes money therefrom. In consideration of the above, the impugned activity of providing cash management services involves use of the motor vehicles for transportation of 'goods'. The motor vehicles would be covered by the exception in sub-section 5(a)(ii) of section 17. Thus, the applicant would be entitled to the ITC on the purchase of the cash carry vans i.e motor vehicles used for t
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nent shall not be allowed. Section 17 – Apportionment of credit and blocked credits. (I) Where the goods or services or both are used by the registered person partly for the purpose of any business and partly for other purposes, the amount of credit shall he restricted 10 so much of the Input tax as is attributable to the purposes of his business, (2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts. the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies. (5) Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) motor vehicles and other conveyances except
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e in respect of motor vehicles. Hence, I see the exceptions. As can be seen, the impugned activity of providing cash management services not being for transportation of passengers OR for imparting training on driving, flying, navigating such vehicles or conveyances, it would not be covered by the exceptions in (B) and (C) of sub-section 5(a)(i). Sub-section 5(a)(i)(A) is about making "further supply of such vehicles or conveyances". The words "further supply" herein are in the nature of "resale". It should be noted that it is not mentioned as being just "supply of such vehicles or conveyances". The word "further" before the word "supply" has to be given its proper due. Here, the legislature intends to cover motor vehicles which are purchased for the purpose of being sold. In this category, we have the chain of the distributors/ dealers of motor vehicles who purchase from the manufacturers for the downward sale to the final cus
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es are used for transportation of goods. The word 'goods' has been defined thus – "Definitions. 2. In this Act, unless the context otherwise requires- (52) goods means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply; (75) money means the Indian legal tender or any foreign currency, cheque, promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance or any other instrument recognised by the Reserve Bank of India when used as a consideration to settle an obligation or exchange with Indian legal tender of another denomination but shall not include any currency that is held for its numismatic value; I find that the applicant has also mentioned that besides i cash', the cash carry vans are also used for transpor
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r section 17(5) of the GST Act specifically mentions that – (5) Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) motor vehicles and other conveyances except when they are used- (i) for making the following taxable supplies, namely:- (A) further supply of such vehicles or conveyances ; or (B) transportation of passengers; or (C) imparting training on driving, flying, navigating such vehicles or conveyances; (ii) for transportation of goods; Further, it is very clear that section 2(52) very clearly gives definition of goods which reads as under :- (52) goods means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply; Thus from the above definition of 'goods', it
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business? If this had been the case then in case of motor vehicles section 17(5) of the GST Act would not have restricted the eligibility of input tax credit in case of motor vehicles to just the four persons/ entities and thus, the exclusion of money from the definition of 'goods' under the GST Act is with very specific intent by the Legislature. In this situation we need to have a relook at the wordings of Section 17(5) (a) of CGST Act which is as under :- (5) Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) motor vehicles and other conveyances except when they are used- (i) for making the following taxable supplies, namely:- (A) further supply of such vehicles or conveyances ; or (B) transportation of passengers; or (C) imparting training on driving, flying, navigating such vehicles or conveyances; (ii) for transportation of goods; We see th
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udes all materials, articles, commodities and all other kinds of movable property, but does not include newspapers, actionable claims, stocks, shares and securities. Thus the issue before the Hon' ble Supreme Court was whether newspaper manufactured from newsprint would be 'goods' or not as a new product 'newspaper' was manufactured. Thus there is no denying that newspapers are goods but were excluded from 'goods' under the Central Sales Tax only with a view to ensure that there is no Sales Tax liability on sale of newspapers. Thus, the context in the case law as referred is totally different and there was no intent to not to treat newspapers as 'goods' but the only intent was to put them out of Sales Tax liability and Hon'ble Supreme Court has rightly interpreted as per intent and context of the Central Sales Tax statute. However when we see definition of 'goods' as given in the GST Act, we see that the definition of 'goods' is a
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39;goods' as per general understating but for the provisions under the GST Act it is specifically excluded from treating them as 'goods' and if that had not been the intention then the transport of currency would not have been excluded from the provisions as applicable in respect of transport of all other goods as per the procedure prescribed through the mechanism of e-way bills as as per general understanding money is also 'goods' Thus the e-way bill provisions exclusively and clearly confirm and reaffirm that 'money' will not be treated as goods in the provisions under section 17(5)(a) (ii) of the GST Act which is reproduced as under – (5) Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) motor vehicles and other conveyances except when they are used- (i) for making the following taxable supplies, namely:- (A) further supply
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ion Cess. Answer 1. The question is answered in the affirmative. As regards rate of GST and/or Compensation Cess, the details being inadequate, the applicant may refer to the Notification No. 1/2017-CentraI/State Tax (Rate) and Notification No. 1/2017Compensation Cess (Rate), as amended from time to time. Question 2 : If the answer to Question 1 is in affirmative, whether Input tax Credit IS available to CMS Info Systems Ltd. ('CMS' or 'the applicant') on purchase of motor vehicles i.e. cash carry vans which are purchased, used for cash management business and supplied post usage as scrap? Answer 2 : [A] Per Sh. Borhade, Member The question is answered in the affirmative. The input tax credit available would be subject to the provisions of the Central / State Goods and Service Tax Rules, 2017 made in this regard. [B] Per Sh. Pankaj Kumar, Member The question is answered in the negative. The input tax credit on purchase of motor vehicles i.e. cash carry vans would not be
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