2018 (11) TMI 487 – AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH – 2018 (18) G. S. T. L. 840 (A. A. R. – GST) – Liability of GST – Supply of goods and/or services – e-procurement Transaction Fee collected on behalf of IT E&C department results – Exemption from GST
–
Held that:- As per the information filed by the applicant, it is observed that the applicant is acting as fund-manager. The applicant was directed by ITE&C Department, to open an account for collection of Transaction Fee relating to e-Procurement platform. Further, the applicant can not act independently for the utilization of funds without the approval of the ITE &C Department. Hence, the fund utilization, shall be in accordance & with the permission and approval of the ITE&C department only.
–
The applicant will be paid service charges @ 5% on e-procurement corpus fund and e-procurement Transaction Fee towards services rendered by the applicant, for which they are paying tax as an independent entity for the servi
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
M/s. ANDHRA PRADESH TECHNOLOGY SERVICES BUILDING (3RD FLOOR, MC ROAD, VIJAYAWADA- 520010 (hereinafter also referred as applicant) having GSTIN: 37AABCA7630E3ZW, are engaged in supply of services. 2. The applicant has filed an application in Form ARA-01 dated 10.07.2018, and paid the requisite fee of ₹ 10,000 (Ten thousand) ₹ 5000 towards SGST, and ₹ 5000 towards CCST vide CPIN No. 18053700142424/ dated 28.05.2018, through online and the acknowledgement number is AD3707180000864, dt. 10.07.2017. 3. The applicant sought for clarification on the following issues :- 1. Whether the e-procurement Transaction Fee collected on behalf of IT E&C department results in supply of goods or services or both, within the meaning of Supply as defined law. 2. Whether the Tax liability arises on e-procurement Transaction Fee collected on behalf of ITE&C department. On 12.07.2018, a letter has been addressed to the jurisdictional officer, i.e., Assistant Commissioner(ST) Patamata
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
rvices provider use to collect the Transaction Fee and Service Tax and the Service Tax is being paid by the Service Provider. Since, the Service provider contract was expired, vide G.O.Ms.No.11, dated 23.07.2010, ITE&C Department directed the applicant to open separate account for the collection of e-procurement Transaction Fee through e-Procurement portal. 7. Accordingly, the applicant has opened separate accounts in ICICI, HDFC, AXIS Banks for collection of e-Procurement Transaction Fee including Service Tax. The accounts are exclusively opened for collection of e-procurement Transaction Fee. After completion of month, the amount is being transferred to State Bank of Hyderabad (merged with State Bank of India) from the above bank accounts. The Service Tax collected is being remitted to Service Tax authorities on the applicant Service Tax Registration Number. Now, the Government has implemented GST w.e.f. 01.07.2017 @ 18% in place of Service Tax. 8. Since, 2011 the Service Tax is
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
&C Department and the applicant was assigned the responsibility of management of account. The applicant is entitled for service charges @ 5% from the Transaction Fee collected through e-Procurement portal. The applicant is remitting the GST on this service charges collected @ 18% to GST authorities with the applicant's GST Number. Legal Provisions: As per Sec.7 of the SGST Act 2017, Supply includes- I. All forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business; II. Import of services for a consideration whether or not in the course or furtherance of business: III. The activities specified in Schedule l, made or agreed to be made without a consideration; and IV. The activities to be treated as supply of goods or supply of services as referred to in Schedule II. As per entry no 6 of notification 1 2/2017-Central tax
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
latform. ii. M/s. C1 India shall change the account of transaction fee collections to the account of APTS w.e.f. 00.00 hours of 01.08.2010 as C1 India contract is ending on 31.07.2010. iii. M/s. C1 India shall make the necessary changes in this regard in the e-procurement portal as well as in the e-procurement application to enable APTS to collect the online transaction fee from the bidders/suppliers through the e-procurement platform henceforth. All the bidders shall pay the transaction fee including service tax in favour of APTS w.e.f. 00.00 hours of 01.08.2010. It is also further issued orders in G.O.Ms.No.17, Information Technology & Communications Dept., e-Procurement, dt. 23.07.2010, in para-5 ordered as under; 5. Government after careful examination, hereby issued the following guidelines for utilization of e-procurement Corpus fund and Transaction fee by amendment/insertion to the orders issued vide G.O.3rd read above (i.e., G.O.No.23, IT E&C Dept., dt. 03.08.2005) base
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
clarification where the tax liability arises on e-procurement transaction fee collected on behalf of ITE&C Department. As per the information filed by the applicant, it is observed that the applicant is acting as fund-manager. The applicant was directed by ITE&C Department, to open an account for collection of Transaction Fee relating to e-Procurement platform. Further, the applicant can not act independently for the utilization of funds without the approval of the ITE &C Department. Hence, the fund utilization, shall be in accordance & with the permission and approval of the ITE&C department only. As seen from the para-5 of G.O.Ms.No.17, dated 31.10.2017, it is clear that the applicant will be paid service charges @ 5% on e-procurement corpus fund and e-procurement Transaction Fee towards services rendered by the applicant, for which they are paying tax as an independent entity for the services rendered to ITE&C. Hence, the transaction fee collected on account
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =