Goods and Services Tax

REDUCTION IN DISCOUNT IS NOT PROFITEERING: GST
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 1-3-2019

Can reduction in discount offered by supplier of goods resulting in increase in price amounts to profiteering in contravention of section 171 of CGST Act, 2017 ? The answer is NO, as affirmed by National Anti-Profiteering Authority (NAA).
In Kerala State Screening Committee on Anti-profiteering and DGAP, CBIC, New Delhi v. Asian Paints Ltd., Kerala 2019 (1) TMI 21 – NATIONAL ANTI-PROFITEERING AUTHORITY ; , the NAA, vide its Order dated 27.12.2018, has ordered that where base price is increased due to reduction in discount, it does not amount to profiteering as discount is offered from the profit margin whic

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, taxes etc:
Particulars
Period
Details
Reference
Pre-GST
Post-GST
1.
Product Description
A
Paint (AP Apex Classic WT 10 LT (HSN Code 3209)
2.
Invoice No.
B
13006429
KR1701110400
3.
Invoice Date
C
20.06.2017
09.11.2017
4.
MRP as per Annexure-7 (Rs.)
D
2.610
2,660
5.
Price before discount per unit (Rs.)
E
2,159
1,927
6.
Discount per unit (Rs.)
F
75.57
67.45
7.
Price after discount per unit (Rs.)
G=E-F
2,083.43
1,859.55
8.
Central Excise Duty @12.5% on 70% of MRP (Rs.)
H=(D*70%)*12.5%
228.38
–
9.
Base Price (Excluding duties & taxes) (Rs.)
I=G-H
1,855.05
1,859.55
10.
Tax Rate Charged (%)
J
14.50% VAT
28% GST
11.
Tax Amount (VAT or GST) (Rs.)
K=G*J
302.10
520.67
12.
Tota

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.24% which was primarily on account of the reduction in the discount and such an increase couldn't qualify as profiteering due to reduction in the tax rate, thus, the provisions of Section 171 (1) of the CGST Act, 2017 relating to profiteering were not contravened in the instant case.
The NAA based on DGAP report, invoices etc, examined whether there was any reduction in the GST rate and whether the benefit of reduction in the rate of tax was passed on or not to the recipient as provided under Section 171 of the CGST Act, 2017. It observed that supplier had increased the base price of the product from ₹ 1855.05/- to ₹ 1859.55/- resulting in an increase of ₹ 4.50/-. In this context, it was clear that the post-GST price

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Complete analysis of Supplementary (Debit note and Credit note) invoices and Input Tax Credit
By: – Sandeep Rawat
Goods and Services Tax – GST
Dated:- 1-3-2019

SUPPLEMENTARY INVOICES AND THEIR USES
Supplementary tax invoice has not been defined under GST law. Supplementary tax invoice is a type of invoice that is issued by a taxable person in case where any deficiency is found in a tax invoice already issued by a taxable person. It can be in form of a debit note or a credit note.
ISSUANCE OF CREDIT NOTE
A supplier of services is mandatorily required to issue a tax invoice. However, during the course of trade or commerce, after the invoice has been issued there could be situations like:
* The supplier has erroneously declared a value which is more than the actual value of the services provided.
* The supplier has erroneously declared a higher tax rate than what is applicable for the kind of the services supplied.
* The quality services supplied is not to the sa

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ued there could be situations like:
* The supplier has erroneously declared a value which is less than the actual value of the goods or services or both provided.
* The supplier has erroneously declared a lower tax rate than what is applicable for the kind of the goods or services or both supplied.
* The quantity received by the recipient is more than what has been declared in the tax invoice.
* Any other similar reasons.
In order to regularize these kinds of situations the supplier is allowed to issue what is called as debit note to the recipient.
Any registered person who issues a debit note in relation to a supply of services, shall declare the details of such debit note in the return for the month during which such debit note has been issued and the tax liability shall be adjusted in such manner as may be prescribed
DETAILS REQUIRED TO BE SHOWN
There is no prescribed format for credit/debit note issued by a supplier. However, it must contain certain prescribed partic

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or his authorized representative.
OTHER PROVISION
As per Section 33 of CGST Act 2017, every person who is liable to pay tax shall indicate in all documents relating to assessment, tax invoice or other like documents, the amount of tax.
INPUT TAX CREDIT
As per section 16(1) of GST law, no registered taxable person shall be entitled to the credit of any input tax in respect of any supply of goods and/or services to him unless he is in possession of tax invoice, debit note, supplementary invoice or such other taxpaying document as may be prescribed, issued by a supplier registered under the CGST/SGST or the IGST Act.
As per section 16(1) & 16(2) of GST law, The registered person will be entitled to the credit of any input tax in respect of any supply of goods and/or services to him only if ALL the following five conditions are fulfilled:
(a)Possession of tax paying document [Section 16(2)(a) read with rule 36 of the CGST Rules]ITC can be availed on the basis of any of the follo

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M/s. TECPRO INFRA PROJECTS LTD. (FORMERLY KNOWN AS BESL INFRA PROJECTS LTD) Versus STATE TAX OFFICER STATE GST DEPARTMENT OF KERALA, ALUVA, THE COMMISSIONER, STATE GOODS AND SERVICES TAX DEPARTMENT, THIRUVANANTHAPURAM, STATE OF KERALA, REPRESENTED BY SECRETARY TO GOVERNMENT, TAXES DEPARTMENT SECRETARIAT, THIRUVANANTHAPURAM AND CENTRAL BOARD OF EXCISE & CUSTOMS DEPARTMENT OF REVENUE, NEW DELHI
GST
2019 (3) TMI 488 – KERALA HIGH COURT – TMI
KERALA HIGH COURT – HC
Dated:- 1-3-2019
WP(C). No. 6385 of 2019
GST
MR DAMA SESHADRI NAIDU, J.
For The Petitioner : ADV. SRI. BEJOY CHERIYAN
For The Respondent : GP DR. THUSHARA JAMES
JUDGMENT
In this writ petition the petitioner has approached this Court with the following relie

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ax Act cannot be enforced after 15/09/2017 so long as the old Entry 54 has not been saved.
iv) To declare that when the provisions of Constitution are inconsistent with the provisions of a statute, the provisions of Constitution will prevail over the provisions of statute and so provisions of Sec.174 of the Kerala Goods and Service Tax Act 2017 to the extent to which they are in conflict with the provisions of Constitution, are bad in law.
v) To declare that as Sec.19 of the Constitution Amendment Act is having supremacy over the rest of Sections of Constitution Amendment Act, the provisions passed under Sec.174 invoking Article 246A of the Constitution of India is subservient to Sec.19 of the Constitution Amendment Act and so any pro

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In Re: M/s. Nash Industries (I) Pvt. Ltd.
GST
2019 (3) TMI 435 – APPELLATE AUTHORITY FOR ADVANCE RULING, KARNATAKA – 2019 (23) G. S. T. L. 367 (App. A. A. R. – GST), [2020] 73 G S.T.R. 308 (AAAR)
APPELLATE AUTHORITY FOR ADVANCE RULING, KARNATAKA – AAAR
Dated:- 1-3-2019
KAR/AAAR/07/2018-19
GST
SRI D.P. NAGENDRAKUMAR, SRI SRIKAR M.S., MEMBER
PROCPEDINGS
(Under Section 101 of the Central Goods and Service Tax Act, 2017 and the Karnataka Goods and Services Tax Act, 2017)
At the outset, we would like to make it clear that the provisions of both the CGST Act and the KGST Act are pari materia and have the same provisions in like matters, and differ from each other only on a few specific provisions; therefore; unless a mention is particularly made to such a dissimilar provision, a reference to the CGST Act would also mean a reference to the corresponding similar provisions under the KGST Act.
The present appeal has been filed under section 100 of the Central Goods and

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ion 98 of the CGST Act, 2017 and KGST Act, 2017 on the following question:
a. Whether the amortized cost of the tools is to be added to arrive at the value of the goods supplied for the purpose Of GST under Section 15 of the CGST Act read with Rule 27 of CGST Rules.
3. The Karnataka Authority for Advance Ruling, vide Advance Ruling No. NO. KAR ADRG 24/2018 dated 25th October 2018 = 2018 (11) TMI 607 – AUTHORITY FOR ADVANCE RULINGS, KARNATAKA. (hereinafter referred to as 'Impugned Order) gave the following ruling:
“The amortised cost of tools which are re-supplied back to the applicant free of cost shall be added to the value of the components while calculating the value of the components supplied as per Section 15 of the CGST/KGST Act,2017.”
4. Aggrieved by the said ruling of the Authority, the applicant has filed an appeal under section 100 of the CGST Act, 2017 / KGST Act, 2017 on the following grounds:
4.1. The appellant submitted that the purchase order provided by the recip

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are provided on FOC basis by the OEM to the component manufacturer in the course or furtherance of his business, there is no requirement for reversal of input tax credit availed on such moulds and dies by the OEM.
1.2. It is further clarified that while calculating the value of the supply made by the component manufacturer , the value of moulds and dies provided by the OEM to the component manufacturer on FOC basis shall not be added to the value of such supply because the cost of moulds/dies was not to be incurred by the component manufacturer and thus, does not merit inclusion in the value of supply in terms of Section 15(2)(b) of the Central Goods and Service Tax Act, 2017 (CGST Act for short)
1.3. However, if the contract between OEM and component manufacturer was for supply of components made by using the moulds/dies belonging to the Component manufacturer, but the same have been supplied by the OEM to the component manufacturer on FOC basis; the amortised cost of such moulds/d

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ted that in the instant case,
a. The obligation of the supply of tools is on recipient/customer.
b. Accordingly, the owner of the tool is recipient /customers.
c. The recipient /customer provided the purchase order to appellant, wherein the scope is merely supply of components.
From the above it is evident that the present case falls under the first situation explained in the above circular. That means, the tool is owned by the OEM (Customer) and supplied at free of cost to appellant. Further, the purchase order is provided for supply of component. As the present case falls under first situation, the cost of the tool is not to be added to the price of component as per the clarification provided by the board.
4.5. Further, they submitted that the cost of the tool is required to be added only if the tool is belonging to the component manufacturer (Appellant). In the present case, the owner of the tool is the recipient / customer and hence the cost of tool is not required to be add

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llected on the activity of the manufacture, whereas the levy of GST is on the supply of goods/services. Further, the scope of supply depends on the scope of the agreement and obligation of the supplier in the agreement. If there is no obligation on the supplier on any aspect, such aspect cannot be constituted as supply and also cannot be considered as value of supply.
4.8. In view of the above submissions, the Appellant pleaded that the ruling of the Authority for Advance Ruling is required to be modified.
Personal Hearing:
5. The Appellant was called for a personal hearing on 19.02.2019 and were represented by Shri. Rajesh Kumar T.R, Chartered Accountant. He reiterated the submissions made in the grounds of appeal. The representative also filed additional submissions before this Authority wherein they stated that the Maharashtra Authority for Advance Ruling in the case of Lear Automotive India Private Ltd had passed a ruling GST-ARA-19/2018-19/B-80 dated 31.07.2018 = 2018 (12) TMI

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with M/s Lear Automotive India Pvt Ltd along with supporting documents.
DISCUSSION AND FINDINGS
7. We have gone through the records of the case and taken into consideration the submissions made by the Appellant in writing and during the personal hearing and also the documents produced by them.
8. The short point for determination is whether the value of the components manufactured and supplied by the Appellant should include the cost of the tools which are supplied by the customer free of cost and used by the Appellant in the manufacture of the components.
9. Under the erstwhile Central Excise regime, Rule 6 of the Central Excise Valuation Rules, 2000 required an assessee to calculate the intrinsic value of the excisable goods by including any additional consideration flowing directly or indirectly from the buyer to the assessee. In other words, since excise duty was levied on the activity of manufacture, any activity which was contributing to the manufacturing activity was inclu

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ection 7 of the CGST Act which reads as under:
7. (1) For the purposes of this Act, the expression “supply” includes –
(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;
(b) import of services for a consideration whether or not in the course or furtherance of business;
(c) the activities specified in Schedule I, made or agreed to be made without a consideration; and
(d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II.
In so far as the valuation of the supply is concerned, Section 15 of the CGST Act provides that the value of taxable supply shall be the transaction value which is the price paid or payable by the recipient provided the supplier and recipient are unrelated parties and price is the sole consideration for the supply. Further Section of

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a Commercial Vehicles Pvt Ltd (DICV).
12. We have gone through the terms (General and Special terms) of the contract entered into between the Appellant and DICV. As per para 16 of the General Terms and Conditions of DICV for the purchase of products and spare parts, which form an integral part of the Contract between DICV and the Appellant, the Appellant is obligated to comply with the requirements of DICV's Special Terms pertaining to tooling. Para 16.2 reads that “If and to the extent the agreed total cost for an item of tooling has been paid by Buyer in full, title to such tooling and any and all IPR created in the course of the development of such tooling for buyer will immediately be transferred to Buyer. Supplier is entitled to keep the tooling only as a temporary possession until the Purchase Order has been performed Supplier must hand over the tooling to Buyer following fulfillment of the Purchase Order if so requested by Buyer.”
13. The Daimler India Special Terms (DIST) ar

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upplier is hereby authorized and required to use DICV Owned Tools within the framework of the supply Contract concluded with DICV concerning the parts to be manufactured with the tools.
The supplier shall use the tools only for the purpose of fulfilling its manufacturing obligations under the supply contract. Hence the supplier is prohibited front any deviating use of DICV Owned Tools in Particular the use of tools for production of parts to supply third parties or the transfer of usage to third parties or unauthorized handover of tools to third parties, without the prior written consent of DIC.V.
2.2 The supplier shall retain DICV Owned Tools at the location as originally agreed between the supplier and DICV
2.4 As a consideration for availing the tools from DICV free of charge, the supplier shall abide by the following terms of maintenance. The supplier must ensure constant defect-free functional capacity and readiness of the tools during their use within the framework of the s

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, DICV may reimburse the supplier the of the tool costs which had not yet been amortised. Upon reimbursement of such Costs, DICV shall be deemed to have unlimited ownership of the tools.
14. On going through the above terms and conditions of the contract between the Appellant and DICV, it is evident that the Appellant is required to use DICV Owned Tools concerning the part to be manufactured with the tool. The tool shall be used only for the purpose of fulfilling its manufacturing obligations under the supply contract. The Tool is developed and manufactured by the Appellant under a specific Purchase Order. The applicable GST on the supply of the tool is levied in the invoice raised by the Appellant for the supply of the Tool. Once the agreed cost of the tool has been paid by DICV, the title of the tool and all IPR created in the course of the development of the Tool will be transferred to DICV. The Appellant is entitled to keep the tool in his premises only as a temporary possession

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e manufacture of parts for the customer. In the event of the second possibility, the customer, DICV takes ownership of the Non-DICV Owned Tools by way of a security only with the objective of ensuring that the supply of their parts by the Appellant is uninterrupted. In the event there is an interruption in delivery of manufactured components using the Non-DICV Owned Tools, then the customer, DICV, has the right to demand the surrender of the tools and reimburse the Appellant the percentage of the tool cost which has not been amortized. On perusal of the contract, it is understood that, in the case Non- DICV Owned Tools are used in the manufacture of the components, the price agreed upon includes the amortized cost of the Non-DICV Owned Tools.
15. CBIC in its Circular No 47/21/2018-GST dated 08.06.2018 has clarified that goods owned by OEM that are provided to a component manufacturer on FOC basis do not constitute a supply as there is no consideration and in such cases, the value of g

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Kerala State Screening Committee on Anti-Profiteering, Director General Anti-Profiteering, Central Board of Indirect Taxes & Customs Versus M/s Kajaria Ceramics Ltd.
GST
2019 (3) TMI 429 – NATIONAL ANTI-PROFITEERING AUTHORITY – TMI
NATIONAL ANTI-PROFITEERING AUTHORITY – NAPA
Dated:- 1-3-2019
Case No. 14/2019
GST
Sh. B. N. Sharma, Chairman, Sh. J. C. Chauhan, Technical Member, Ms. R. Bhagyadevi, Technical Member And Amand Shah, Technical Member
Ms. A. Shainamol, Additional Commissioner, SGST, Kerala for the Applicant No. 1.
Sh. Anwar Ali T.P., Additional Commissioner for the Applicant No. 2.
ORDER
1. The brief facts of the case are that The Kerala State Screening Committee on Anti-Profiteering vide the minutes of its meeting held on 08.05.2018 had referred the present case to the Standing Committee on Anti-profiteering, alleging profiteering by the Respondent on the supply of 'Caribbean Wood Tile' (here-in referred to as the product) by not passing o

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entral Excise Duty @ 12.5% of the 60% of the MRP and there was no VAT or CST charged in the invoice whereas after implementation of the GST w.e.f. 01.07.2017, the tax rate of GST on the said product was fixed at 28%. The DGAP has further furnished the pre-GST & the post-GST sale invoice-wise details of the applicable tax rate and base price (excluding CST or GST) of the said product supplied by the Respondent in the table given below:-
Period
Pre-GST (prior to 01.07.2017)
Post-GST (post 01.07.2017)
Description of the product supplied
Caribbean Wood Tile
Invoice No. & Date
2217100715 dated 27.04.2017
4417101296 dated 25.08.2017
MRP Per Box
800
800
Base price (in Rs.)
489.60
468
Excise Duty (12.5% on 40% of MRP)
60
Nil
Base Price (excluding Duties and Taxes)
429.60
468
GST
Nil
28%
Total Tax Rate
13.97%
28%
5. After scrutiny of the above two invoices issued by the Respondent, the DGAP has intimated that the rate of tax on the product was 13.97% in the pre-GST er

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namol, Additional Commissioner, SGST, Kerala appeared on behalf of the Applicant No. 1 on 31.10.2018. During the hearing, it was observed that the DGAP report had not considered the MRP and base price (excluding VAT) of the product in question.
7. The Authority accordingly vide its letter dated 13.12.2018 had returned the report to the DGAP for re-investigation on the above mentioned issue under Rule 133(4) of the CGST Rules, 2017.
8. The DGAP vide his Report dated 20.12.2018 has submitted that as per Annexure-7 of the minutes of the Kerala Screening Committee dated 08.05.2018, profiteering was alleged against the Respondent, after introduction of GST w.e.f. 01.07.2017. The DGAP has further stated that the Respondent is listed at Sr. no. 77 of Annexure 7 to the minutes of the meeting of State level Screening Committee of Kerala dated 14.05.2018 wherein it was mentioned that the product attracts VAT @ 14.50%. On scrutiny of pre-GST invoice no. 2217100715 dated 27.04.2017, referred to

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from 13.97% to 28%. Hence, Section 171 of the CGST Act, 2017, is not attracted.
10. We have carefully examined the report of the DGAP and the documents placed on record and find that the only issue that needs to be dwelled upon is as to whether there was reduction in the rate of tax on the product in question after introduction of GST and whether the provisions of section 171 of CGST Act, 2017, are attracted. Perusal of Section 171 of the CGST Act, 2017, reads as under:-
(1). “Any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices.”
11. On perusal of the facts of the case and the details provided in the table given above in para 4 it is apparent that there was no reduction of tax with the introduction of GST. The DGAP on examining various facts has categorically mentioned that the invoices very clearly show that no VAT was levied and CST was also exempted prior

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M/s Systematic Conscom Ltd. Versus State Of U.P. And 2 Others
GST
2019 (3) TMI 374 – ALLAHABAD HIGH COURT – TMI
ALLAHABAD HIGH COURT – HC
Dated:- 1-3-2019
Writ Tax No. – 235 of 2019
GST
Pankaj Mithal And Saumitra Dayal Singh JJ.
For the Petitioner : Nikhil Agrawal
For the Respondent : C.S.C.
ORDER
Heard Sri Nikhil Agrawal, learned counsel for the petitioner and Sri CB. Tripathi for the respondents.
The writ petition is directed against the order passed under Section 73

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Kerala State Screening Committee on Anti-profiteering, Director General of Anti-Profiteering, Central Board of Indirect Taxes & Customs Versus M/s Velbon Vitrified Tiles Pvt. Ltd.
GST
2019 (3) TMI 370 – THE NATIONAL ANTI-PROFITEERING AUTHORITY – TMI
THE NATIONAL ANTI-PROFITEERING AUTHORITY – NAPA
Dated:- 1-3-2019
13/2019
GST
Sh. B. N. Sharma, Chairman, Sh. J. C. Chauhan, Technical Member, Ms. R. Bhagyadevi, Technical Member And Sh. Amand Shah, Technical Member
For the Applicant : Smt. A. Shainamol, Additional Commissioner, SGST, Kerala, Sh. Anwar Ali, Additional Commissioner, DG Anti-Profiteering
ORDER
1. The brief facts of the case are that the Applicant No. 1, vide the minutes of its meeting held on 08.05.2018 had referred the present case to the Standing Committee on Anti-profiteering, alleging profiteering by M/S Velbon Vitrified Tiles Pvt. Ltd., Unchi Mandal, Morbi, Gujarat “Ceramic Vitrified Tiles” Nano Series PRE-I (HSN Code 69072100) (hereafter called a

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port has stated that vide Notification No. 41/2017- Central Tax (Rate) dated 14.11.2017 the GST rate on the product “Ceramic Vitrified Tiles” Nano Series PRE-I (HSN Code 69072100) was reduced to 18% from the existing rate of 28% w.e.f 15.11.2017. Based on scrutiny of the two invoices issued by the Respondent, the pre & post GST rate reduction sale invoice-wise details of the said product are furnished in the table below by the DGAP:-
Table
Description of the Product
Pre-revision (Before 15.11.2017)
Post-revision (After 15.11.2017)
Difference in Price (Rs.)
Invoice No./Date
Tax Rate
Base Price per Box Excluding GST (Rs.)
Invoice no./Date
Tax Rate
Base Price per Box Excluding GST (Rs.)
Ceramic Vitrified Tiles 600X600 Nano Series pre-I (HSN code 69072100
0651 dated 24.10.17
28%
Rs. 232.50/-
0860 dated 15.12.17
18%
Rs. 232.50/-
–
5. The DGAP after examining the above invoices has submitted that there was no increase in the per unit taxable amount (excluding GST) of the

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dated 12.12.2018 passed under Rule 133 (4) of the CGST Rules, 2017, had directed the DGAP to investigate the above issue and send his Report accordingly.
8. The DGAP has submitted his Report on 24.12.2018 under Rule 133 (4) of the CGST Rules, 2017, and has stated that the present case was covered by Annexure-6 of the minutes of the meeting held by the Applicant No. 1, alleging profiteering by the manufacturer/wholesalers by the Respondent in pursuant to GST rate reduction w.e.f. 15.11.2017, in respect of supply of tiles to M/S Sooraj Tiles. The Report has also stated that Kerala GST officers had conducted enquiries from M/S Sooraj Tiles, Palakkad, Kerala and had procured the latter's purchase and sale invoices, however, as profiteering had been alleged against the Respondent the purchase invoices of M/S Sooraj Tiles have been relied upon, which were the sale invoices of the Respondent.
9. We have carefully considered the DGAP's Report and the documents placed on record and f

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Adil Asagar Versus State Of U.P. And Another
GST
2019 (3) TMI 168 – ALLAHABAD HIGH COURT – TMI
ALLAHABAD HIGH COURT – HC
Dated:- 1-3-2019
Writ – A No. – 235 of 2019
GST
Pankaj Mithal And Saumitra Dayal Singh JJ.
For the Petitioner : Pawan Kumar
For the Respondent : C.S.C.,Nagendra Nath Mishra
ORDER
Heard Sri Nikhil Agrawal, learned counsel for the petitioner and Sri CB. Tripathi for the respondents.
The writ petition is directed against the order passed under Section 7

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Refund With Payment Of Tax In Case Of Deemed Exports
Query (Issue) Started By: – HIMANSHU GOEL Dated:- 28-2-2019 Last Reply Date:- 2-3-2019 Goods and Services Tax – GST
Got 3 Replies
GST
As per Rule 96(10) of CGST Rules, 2017, a person cannot claim refund of IGST on export of services where such person has availed benefit of Deemed Export under NN 48/2017-CT dated 18th Oct, 2017. Whether this restriction is applicable for
(a) indefinite period,
(b) tax period for which refund of I

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Commission received by the owner of petrol pump from petroleum company
Query (Issue) Started By: – khaja sayeed Dated:- 28-2-2019 Last Reply Date:- 29-3-2019 Goods and Services Tax – GST
Got 1 Reply
GST
Sir,
Commission paid by the petroleum company for the services provided by the owner of the retail outlet i.e. petrol pump is taxable under GST? If it is what is the GST tax rate? Kindly specify.
Reply By SHARAD ANADA:
The Reply:
Yes GST applicable @18%
Discussion Forum – Know

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43rd Civil Accounts Day on March 1, 2019; On the occasion, the Finance Minister, Shri Arun Jaitley to make a Statement on the implementation of PM -KISAN Yojana through PFMS and to release the Compendium on GST Refunds compiled by the Office of Pr. CCA (CBIC) among others
News and Press Release
Dated:- 28-2-2019

The Indian Civil Accounts Service (ICAS) is celebrating March 1 every year as the “Civil Accounts Day”. Since its inception, the ICAS has steadily grown in stature and now plays an important role in the management of public finances of the Union Government. A function is being organized on March 1, 2019 at Mavalankar Auditorium, Constitution Club of India, Rafi Marg, New Delhi to mark the 43rd Civil Accounts Day.
The 43rd Civil Accounts Day will essentially show case the progress of the flagship project of the Indian Civil Accounts Organization viz the Public Financial Management System (PFMS). Apart from this, the role of PFMS in processing IGST refunds under th

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1 -Implementation of PM -KISAN Yojana through PFMS
2 -Processing of GST refunds through the ARPIT application integrated with PFMS
The Finance Minister, Shri Jaitley will subsequently make a Statement on the implementation of PM -KISAN Yojana and will release the Compendium on GST refunds compiled by the Office of Pr. CCA (CBIC).
PFMS will now also be implementing the Government ambitious PM -KISAN Yojana which would involve an estimated additional 12 -13 crore beneficiaries. This involves a massive exercise of coordination with multiple stakeholders including the Ministry of Agriculture and the Banks for achieving the objective. It is indeed a proud moment for the Indian Civil Accounts Organization that the First Tranche of ₹ 2000 was successfully credited to the Banks Accounts of the first lot of 1.01 crore beneficiaries on 24th February 2019 with the formal launch of the scheme by the Prime Minister.
The ICAS has been committed to the leveraging of IT for enhancing the e

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crore during this entire period out of which R 23.05 lakh crore (approximately 50%) were successfully processed during the calendar year 2018 alone.
• Bank Integration -PFMS today is integrated with a total of 249 banks under all categories. 67 of these banks were integrated during the calendar Year 2018 alone.
DBT transactions –
• PFMS has successfully processed in excess of 179 crore DBT transactions involving total DBT payments of R 3.94 lakh crore during this entire period. Almost 40% -45% of these transactions were successfully effected in the calendar year 2018 alone. Currently the total number of DBT beneficiaries being serviced by PFMS is in excess of 18 crores.
• Agencies registered for DBT -As on date 25.36 lakh agencies are registered with PFMS for DBT payments.
The highlights of the 43rd Civil Accounts Day function shall be the following:
i. On the occasion of the 43rd Civil Accounts Day, the Finance Minister shall be briefed by the Controller Genera

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e from PFMS (Public Financial management System) up to the previous day. The Dashboard also incorporates data from the treasury systems of the 29 States and 2 UTs with legislature, i.e. releases made by the Government of India to the State Governments under the various Centrally Sponsored Schemes. The data for Non-Tax Receipts (through www.bharatkosh.gov.in) is also available for monitoring.
The Dashboard also has a unique feature of monitoring Bank Balance of all the Agencies involved in the implementation of schemes of Government of India. This is envisaged to reduce idle/parked/unutilised funds with the Agencies and to facilitate just-in-time releases, thereby reducing the cost to the Government of India.
The Bank Monitoring Mobile Application is a facility for Bank Performance Monitoring developed to keep track of various Key Performance Indicators for the over 250 Banks integrated with PFMS's Account Validation and Payment system. Indicators like time taken to credit funds into

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of CGST, IGST, Compensation Cess and UTGST-others. This is a multi-user Portal and provides Dashboard facility and various MIS, Accounting and other Reports. ARPIT owing to its design and system capabilities can also be adopted by all the 29 states and 7 UTs for accounting of State GST/UTGST.
• GRameen Internal Audit Portal (GRIP)- GRameen Internal Audit Portal is an end to end software solution for document management of Risk Based Internal Audit and process related to analysis of the findings. This portal has been developed and piloted in Ministry of Rural Development where Risk Based Internal Audit of MGNREGA and PMAY schemes are done through this portal. Under MGNREGA, more than ₹ 60,000 crore and more than 19,000 crore under PMAY has been allocated during current financial year. Office of CGA is responsible for conducting Internal Audit of the expenses incurred out of the funds released by Government of India. Hence efforts are made to make Internal Audit automated a

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Accurate Bag Classification Under GST: Refer to General Rules When Fabric Material is Unspecified in Customs Tariff.
Case-Laws
GST
Classification of goods – Bags/Sacks – in the absence of any

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Lodging and food services for students under MoU with schools are taxable at 18% GST; no exemption.
Case-Laws
GST
Classification of supply – service to the students for lodging along with foo

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Ambulance Input Tax Credit Denied for Employee Benefits Under GST Act Section 17(5)(b)(iii)(A); Not Covered by Exceptions.
Case-Laws
GST
Input tax Credit – ambulances purchased for the benefi

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GST Applies to School Project Supply Under BOOT Model, Says Authority for Advance Rulings; No Exemption Granted.
Case-Laws
GST
Classification of supply – setting up a project in the school un

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GST applicability on transfer of brand
Query (Issue) Started By: – Mohideen A Dated:- 28-2-2019 Last Reply Date:- 2-3-2019 Goods and Services Tax – GST
Got 2 Replies
GST
Is transfer of br

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GST on used vehicle
Query (Issue) Started By: – sunil kumar Dated:- 28-2-2019 Last Reply Date:- 4-3-2019 Goods and Services Tax – GST
Got 11 Replies
GST
Dear Sir,
Iam a registered dealer under GST.May I request your expert advice as under:
If I purchase a repossessed vehicle @ 100000-00( which falls under 12% gst)
PURCHASE PRICE :- 100000-00
EXPENSES ;- 25000-00 (on insurance cover,MV tax,Parking charges to yard,4 tyre, (incld.GST)
Sold the vehicle@ ;- 150000-00
Net Dealer Margin :- 25000-00
Would I have to pay the GST on Dlr Margin i.e on 25000-00 or on the difference of sale price & purchase price 150000 (-)100000 )= 50000
Kindly have your kind advice on the above confusion.
Regards,
Sunil
Reply By KASTURI SETHI:
T

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customer against cost of insurance policy, new tyres, parking charges payable to parking yard & transportation charges from yard, after adding nominal services charges.
For example :-
cost of insurance policy 8000-00 (GST payable)
Parking Charges 10000-00 (GST payable)
Cost of 04 tyres 7000-00 (GST payable)
Tpt charges Pertol & driver 3000-00 (Vat payable on petrol)
Gross 28000-00
service charges from customer 2000-00
Do I have to pay the GST on 28000-/ or 2000/- against service charges collectable from customer.
May I request for your kind advice?
Regards,
Sunil
Reply By KASTURI SETHI:
The Reply:
Dear Querist,
First you are requested to reply to the question raised on 2.3.2019 by Sh.Ganeshan Kalyani Ji. Pl. confirm whether

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Transfer of proprietorship business from Mother to Son
Query (Issue) Started By: – vaishali raveshiya Dated:- 28-2-2019 Last Reply Date:- 2-3-2019 Goods and Services Tax – GST
Got 2 Replies
GST
Respected members,
kindly guide me how to deal with in regards to following matter in Income Tax and GST?
A business is carried on in the name of mother will be taken over by/ transfer to her son.
What procedure to be followed in GST,
whether GST is payable ot it is exempt under entry 2 of exemption list?
When to take new GST registration no, before surrender of registration no taken in the name of mother or after cancellation of it?
Whether ITC can be claimed on closing stoch after transfer of business??
Whats other impact in GST

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How to GST get exemption for diesel purchase in SEZ from domestic.
Query (Issue) Started By: – Jagdish MAheshwari Dated:- 28-2-2019 Last Reply Date:- 3-3-2019 Goods and Services Tax – GST
Got 3 Replies
GST
Dear Sir,
We have purchase diesel from domestic area for authorised operation purpose in SEZ.
how to get GST exemption for the same.
Reply By KASTURI SETHI:
The Reply:
You have purchased diesel from dealer for SEZ operations. It is treated as export. Thus dealer has exported t

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Impact of Section 49A On Working Capital limits.
Query (Issue) Started By: – TirumalaRao Vuppala Dated:- 28-2-2019 Last Reply Date:- 28-2-2019 Goods and Services Tax – GST
Got 1 Reply
GST
Dear Sirs,
What is the impact of Section 49A on working capital limits? If IGST not available to adjust to output tax of CGST & SGST, we will be pay by way of Cash. As per my knowledge up to 31-01-2019 ITC GST adjustment is correct. What is the use to dealers as per new adjustment system of GST?
Reply By Spudarjunan S:
The Reply:
Dear Sir,
The probable reason for insertion of section 49A under GST Act is to utilise the IGST credit in first against the tax liability in order to avoid the complexity to Central Government to apportionate the

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Common Services received at Head Office
Query (Issue) Started By: – Kaustubh Karandikar Dated:- 28-2-2019 Last Reply Date:- 4-4-2019 Goods and Services Tax – GST
Got 4 Replies
GST
XYZ having manufacturing unit cum Head Office in Maharashtra and other units outside Maharashtra. Certain common services are received at Maharashtra on which 100% credit is taken at Maharashtra. In this situation, they can raise monthly invoice in the name of other units under the category of 'Business Support Service' based on the value mentioned in the invoices of the service provider for common services received at Maharashtra and by adding certain percentage of mark – up on it. Once this figure is arrived at, the same needs to be apportioned in t

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red by the Head Office in seeking opinion on an issue which is benefiting to all the branches located in various States then first challenge is reverse charge liability cannot on legal service cannot be paid under ISD registration. Thus for compliance the liability has to be paid under regular registration taken for Maharashtra . For doing this payment the invoice ahould be in the address of office/factory having regular registration number.
Then a cross charge invoice is to be raised from regular registration number to the ISD registration number . And the credit gets populated to ISD number then it can distribute the credit .
In order to overcome such challenges company is instead of taking ISD registration raises cross charge invoices

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GST : SUPPLY OF GOODS IN UNIT CONTAINERS
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 28-2-2019

In one of the advance rulings, assessee was supplying animal carcass in its natural shape in frozen state in different weights and sizes in bags. The ruling was sought on whether such supplier can be considered to have been supplied such goods in 'unit containers' .
In Re: Ahmednagar District Goat Rearing and Processing Cooperative Federation Ltd. 2018 (5) TMI 1393 – AUTHORITY FOR ADVANCE RULING – MAHARASTRA ;
In the instant case, Ahmednagar District Goat Rearing and Processing Co-op Ltd. was engaged in slaughtering and processing of sheep/goat meat and supplied these products to Army against tender. It supplied to Army sheep/ goat meat in carcass form i.e. the whole animal carcass in its natural shape in frozen state. Naturally, the carcass would be in different weight and sizes. Further, there was no fixed quantity & size in which these carcasses were d

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Ruling was also sought on taxability / exemption.
W.e.f. 1.7.2017, the relevant GST notifications provided for the following conditions:
* W.e.f. from 1st July, 2017 till 14th November, 2017:
* Must be frozen
* Must be packed in unit container
W.e.f. from 15th November, 2017 onwards:
* Must be frozen
* Must be packed in unit container
* Must bear a brand
The words 'unit container' have been defined similarly in both the Notification No.1-Integrated Tax (Rate) and Notification No, 2/2017- Integrated Tax (Rate) of the IGST Act as under –
The phrase "unit container" means a package, whether large or small (for example, tin, can, box, jar, bottle, or carton, drum, barrel, or canister) designed to hold a predetermined quantity or number, which is indicated on such package.
The product, in question was sheep/ goat meat in carcass form i.e. the whole animal carcass in its natural shape. It is supplied in frozen state in LDPE and HDPE bags. The above defin

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nit container' and these products will be covered by schedule entry 4 of Notification No. 1 – Integrated Tax (Rate) during period 1.7.2017 to 13.11.2017. From 14.11.2017 onwards, the products would be covered under schedule entry 1 of Notification No. 1- Integrated Tax (Rate).
The appellate Authority for Advance Ruling has however modified this ruling vide Order dated 11.09.2018 and reported hereunder.
Appellate Ruling
Being aggrieved, the matter went to Appellate Authority for Advance Ruling, Maharashtra [In Re: Ahmednagar District Goat Rearing and Processing Cooperative Federation Ltd. 2018 (9) TMI 1184 – APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA ].
It was observed that the definition of 'unit container' is provided under the CGST Act as an explanation to the exemption Notification and we do not see any reason to resort to the similar definitions available in other Acts/Statutes. So, we will concentrate and restrict our scope to the definition available under the CGST A

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d goods about the fixed quantity/weight/number contained in the package which was not the case. At nowhere, it was mentioned that the said bags (LDPE or HDPE) should contain any fixed weight/quantity or number of the goods to be supplied. Just by mentioning the weight of the carcass (which may be one or two in number) on the outer packing in no way can be considered as the pre-determined quantity of the package. There is no doubt that the samples of bags produced before us during hearing are covered under 'package' as per the definition given in explanation to the notification but that package is not designed to hold any predetermined quantity.
The AAAR held that the whole (Sheep/Goat) animal carcass in its natural shape in frozen state in different weight and size packed in LDPE bags without mentioning the weight and one or two such LDPE bags further packed in HDPE bags being supplied to Army by appellant against tender shall not qualify as product put up in 'unit container'.
Sch

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Ashland India Pvt. Ltd Versus CCGST, Thane
Central Excise
2019 (3) TMI 181 – CESTAT MUMBAI – TMI
CESTAT MUMBAI – AT
Dated:- 28-2-2019
APPEAL NO: E/87741/2018 – A/85424/2019
Central Excise
Shri Ajay Sharma, Member (Judicial)
Appellants: Shri Sanjay Dwivedi, Advocate
Respondent: Shri Sanjay Hasija, Superintendent (AR)
ORDER
The core of dispute in the present appeal arising out of order-in-appeal nos. PVNS/250/APPEALS/ THANE/TR/2017-18/2423 dated 13/03/2018 is the invocation of the extended period of limitation as well as of penalty.
2. The brief facts of the matter are that the Appellant i.e. AIPL manufactured lubricating oil and grease, and their major input was base oil and additives. They delivered finished good to M/s. VCL for home consumption. In addition to supplying duty paid products to M/s. VCL for home consumption, the appellant also removed finished goods under bond for supplying to M/s. VCL for export to Nepal and for supply to SEZ/EOU. The Audit

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1944 read with Rule 15 of Cenvat Credit Rules 2004. On appeal filed by the Appellant the ld. Commissioner vide impugned order dated 13.03.2018 upheld the confirmation of demand and rejected the appeal filed by the Appellant.
3. I have heard ld. Counsel for the Appellant and Learned Authorised Representative for the Revenue and perused the record. Learned Counsel for the Appellant submit that the Appellant received services from two different supplier. These services were in the nature of erection, renting of equipment like crane, boom lift, staircase etc., on temporary basis and the said services were essential for carrying out production activity and therefore the Appellant was under bonafide belief that the disputed services are covered within the definition input service as per Rule 2(l) of Cenvat Credit Rules, 2004. He further submitted that immediately after raising objection by the Audit, the Cenvat credit on disputed services was reversed along with interest much before the is

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w cause notice is mere suppression of facts without anything further. There is no such allegation that the Appellants was under legal obligation to give invoice wise and item wise details of Cenvat credit which they have not given. Merely, mentioning malafide intention or suppression of facts or willful default is not sufficient. There has to have something more to prove malafide/ suppression/ willful default on the part of the Appellant. The Hon'ble Supreme Court in the matter of Uniworth Textiles Ltd. Vs CCE, 2013(288) ELT 161 (SC) has laid down that mere non-payment of duty is not equivalent to collusion or willful suppression of facts and in order to invoke extended period, specific and explicit allegation must be proved by the Revenue. In the present case, none of the authorities below have brought out any evidence on record to substantiate the allegation of suppression of fact or willful default on the part of the Appellant. All the transactions were duly reflected in excise retu

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5(75) ELT 721(SC) has laid down that suppression or mis-statement of facts must be willful to constitute a ground for the purpose of Section 11AC ibid and mis-statement or suppression of facts must be willful and the condition precedent for imposition of penalty is that the authority has to be satisfied that non-payment or short-payment of duty was deliberate with intention to evade payment of duty. Since on the facts of this case I have come to the conclusion that the authorities below have failed to brought on record any evidence to prove suppression on the part of the Appellant and the Appellant by his conduct has proved that there was no malafide intention on the part of the Appellant and it was only a bonafide error/belief on the part of the Appellant, therefore neither extended period of limitation is invocable in the facts of the present case nor penalty is liable to be imposed on the Appellant. The appeal is therefore allowed, with consequential relief, if any.
(Pronounced in

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M/s. SVV Transports Versus Commissioner of GST & Central Excise, Trichy
Service Tax
2019 (3) TMI 119 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 28-2-2019
Appeal No. ST/599/2012 – Final Order No. 40393/2019
Service Tax
Ms. Sulekha Beevi C.S., Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical)
Ms. Amrutha Arvind, Advocate for the Appellant
Shri B. Balamurugan, AC (AR) for the Respondent
ORDER
Per Bench
Brief facts are that the appellants are engaged in providing the services of Site Formation and Clearance, Excavation and Earthmoving and Demolition Services. On scrutiny of records, it was noticed that they provided such services to M/s. Madras Cements Ltd. and received an amount of Rs. 16,93,372/- as service tax from October 2009 to January 2010 but did not pay the amount to the Central Government. On such allegation, show cause notice was issued to the appellant proposing to demand service tax along with interest and also for imposin

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est before issuance of show cause notice as pointed out by officers. To support this argument, she took assistance of the decision of the Hon'ble High Court of Karnataka in the case of Commissioner of Central Excise, Bangalore Vs. Adecco Flexione Workforce Solutions Ltd. – 2012 (26) STR 3 (Kar.). It was also submitted by her that apart from mere allegation that there is suppression of facts with intention to evade payment of service tax, department has not been able to point out any positive act on the part of the appellant indulging in suppression of facts. There was no intention to evade payment of service tax which is very much clear since the appellant has discharged the service tax along with interest immediately and also had filed periodical returns. She therefore prayed that the penalty imposed under section 78 may be set aside.
3. The ld. AR Shri B. Balamurugan supported the findings in the impugned order. He submitted that this is a case where the appellant has collected the

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n particular no show cause notice has to be issued. The intent of this section is to reduce litigation and also to encourage the appellant to pay up the tax as and when pointed out by the department or coming to notice of the assessee. Thus, it is only intended for voluntary and easy compliance on the part of the assessee. The decision of the Hon'ble High Court of Karnataka in the case of Commissioner of Central Excise, Bangalore Vs. Adecco Flexione Workforce Solutions Ltd. (supra) has held that when the assessee has paid up the demand of service tax along with interest no show cause notice and in particular no penalty can be imposed. The ld. AR has been at pains to argue that the appellant has not discharged the service tax even though collected by them and therefore it is implied that they have an intention to evade payment of service tax. It is submitted by ld. counsel that they had filed the returns within the due date and due to financial hardship they could not deposit within tim

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M/s. Reliable Computer Forms (P) Ltd. Versus Commissioner of GST & Central Excise, Chennai
Central Excise
2019 (3) TMI 108 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 28-2-2019
Appeal No. E/41632/2013 – Final Order No. 40399/2019
Central Excise
Ms. Sulekha Beevi C.S., Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical)
Shri S. Ramachandran, Consultant for the Appellant
Ms. T. Usha Devi, DC (AR) for the Respondent
ORDER
Per Bench
The appellants are engage in manufacture of manifold business forms including printed/ blank continuous computer stationery forms and printed cut sheet forms. Based on investigation, it appeared to the department that the products would be correctly classifiable under 4820 of CETA, 1985. However, the appellants were clearing all these impugned goods under the premise that they would fall under SSI exemption under Notification 8/2003-CX. Pursuant to investigation, show cause notice was issued to the appellant i

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m are not liable to central excise duty in view of various case laws.
2.3 He submitted that the manufacture of computer stationery and manifold business forms are correctly classifiable under Chapter 4901 and not under 4820 as held by Mehra Computers Systems Ltd. as reported in 2017-TIOL-3852-CESTAT-MAD.
2.4 He submitted that the Hon'ble Supreme Court in Commissioner of Central Excise Vs. Gopsons Papers Ltd. – 2015 (324) ELT 5 (SC) has held that printed thermal paper rolls are classifiable only under 4901 of CETA and not under 481190.
2.5 So also the Tribunal in the case of Data Processing Forms Pvt. Ltd. vs. Commissioner of Central Excise – 2014 (311) ELT 161 (Tri. Ahmd.) has held that stationery forms and statutory forms like pre-printed forms such as excise invoice forms, commercial invoice forms, letter head forms, PF slip forms etc. would require to be classified under only 49.11 and not 4820. He also placed reliance on the following decisions:-
a. Dy. Chief Manager (P&S) Cent

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ted in the synopsis indicating the working of how the turnover by them in each of the years 2006 – 07 and 2007 – 08 and the threshold limit for SSI is as under:-
 
2006 – 07
2007 – 08
Totals sales turn over as per Balance Sheet
 
22448674
 
20960900
Less Deductions allowed SCN work sheet Annexure III
 
118501
 
85772
Balance turnover
 
21266173
 
20875128
Less: Turnover of exempted goods – Chapter 49 items
 
 
 
 
LIC intimation letter Ch. 49.01
1729002
 
3632947
 
Share certificates, bus ticket, Indian airlines boarding pass, hall tickets, kishintha Entry Ticket – Ch. 49.01
350844
 
180605
 
RC Book, Tax card – Ch. 49.01
2503209
 
0
 
ID Card – Ch. 49.01
46.79
 
0
 
FD Form – Ch. 49.01
 
 
41600
 
Hall ticket for Madras University – Ch. 49.01
 
 
180605
 
 
4587734
4587734
3855152
3855152
Balance Tu

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I limits
 
1 Crore
 
1.5 crore
In the circumstances, we find it appropriate to remand the matter back to the original authority who will take note of in such re-adjudication and apply the ratios laid down in the decisions cited above. The authority shall look into the claim and after applying the ratio of these case laws, it is found that the impugned goods are required to be classified under CETA 4901 and not under CETA 4820, the authority shall exclude the turnover thereof from the taxable turnover for the purposes of the SSI notification 8/2003-CX. In case after such exercise, the taxable turnover is found within SSI exemption limit, present duty demand will consequently get extinguished. In any case, in view of the issue having been mired in litigation, no penalty will be imposable even on any remnant duty liability if arises upon such re-adjudication. The impugned order is set aside and the appeal is allowed by way of remand on above terms.
(Dictated and pronounced

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