RECENT ADVANCE RULINGS IN GST (PART-3)
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 5-7-2018
Advance rulings are important in any tax law as it provides a forum for clarification and possible interpretation of statutory provisions. Moreover, it conveys the legislative intention from the revenue's view point. Provisions of advance ruling are contained in section 95 to 106 of CGST Act, 2017 and State / UT GST enactment. Rules 103 to 107 of also provide for forms, manner, certification etc.
The Authority for Advance Rulings (AAR) have been set up in all the states and we have now over 50 advance rulings on different issues already pronounced by various State Authorities. However, appellate mechanism for filing appeals against AAR rulings is not yet in place and one is faced with this challenge. Another major issue presently being faced is about multiple authorities (equal to number of States), each pronouncing a ruling of its own even if the matter is co
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uting a works contract involving a provision of goods as well as services. Thus, depending upon nature of supply, intra state or inter-state, rate of tax would be governed by Entry No. 3(ii) of the Notification No. 8/2017 – Integrated Tax (Rate under the Integrated Goods and Services Tax Act, 2017(IGST Act) or the Notification No. 11/2017 – Central Tax/State Tax (Rate) under the CGST Act and MGST Acts. The rate of tax would be 18 per cent under the IGST Act and 9 per cent each under the CGST Act and the MGST Act. [Fermi Solar Farms (P.) Ltd., In Re. (2018) 5 TMI 963 (AAR-Maharashtra); ].
Advance Ruling on job work or manufacture (electricity generation is supply of goods)
Where applicant-power company i.e. JEL generates power from coal supplied by JSL, a steel company, and JEL supplies power to JSL, activity undertaken by JEL amounts to manufacture of electricity from coal as supplied by JSL and is squarely covered in definition of 'manufacture' under GST Act and is a transac
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ific definition provided for interpretation of exemption notification. Further, it was found that the education service provided in the instant case is taxable at the rate of 9 percent under CGST Act, 2017 and 9 percent under SGST Act, 2017, i.e. @ 18% in aggregate. [Simple Rajendra Shukla, In Re 2018 (5) TMI 648 – AUTHORITY FOR ADVANCE RULING – MAHARASHTRA ].
Advance Ruling on nature of supply
Where advance ruling was sought on nature of supply i.e., mixed or composite supply for supply of UPS along with battery. Applicant's contention was that it amounts to composite supply, it was ruled that the supply of UPS and battery is to be considered as mixed supply because they are two different and independent items which are supplied under a single contract at a combined single price, i.e., not being naturally bundled. [Switching Auto Electro Power Ltd., In Re. (2018) 4 TMI 810 (AAR-West Bengal); ].
Advance Ruling of applicability of GST on reinstatement charges
Where applicant was eng
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R-Maharashtra); ]
Advance ruling on registration
Where the Applicant was not registered under any of the repealed Acts and desired to have a ruling on whether it is required to be registered under the CGST Act, 2017 / WBGST Act, 2017.
In the instant case, where an applicant was engaged exclusively in supplying goods and services that are wholly exempt from tax, it was ruled that he will not be not liable to be registered in accordance with provisions under section 23(1) of GST Act, subject to condition that applicant is not otherwise liable to pay tax under Reverse Charge mechanism under section 9(3) of GST Act or section 5(3) of IGST Act. [Joint Plant Committee, In Re (2018) 4 TMI 809 (AAR-West Bengal);].
Advance Ruling on taxability of Canteen services by employer
Where the assessee preferred an application for Advance Ruling for taxability of recovery of food expenses from employees for the canteen services provided by it. It submitted that they were providing canteen services
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