New Guidelines to Resolve IGST Export Refund Errors and Streamline Processes for Exporters Under Circular.
Circulars
Customs
IGST Export Refunds–resolution of errors
TMI Updates – Highl
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Court Upholds Constitutionality of Section 174 KGST Act; Confirms Legislative Authority Under 101st Constitutional Amendment.
Case-Laws
GST
Constitutionality of section 174 of KGST Act and 10
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Restaurant Profiteering Case: Rs. 41.42 Crore Illegally Earned u/r 133(1) of CGST Rules, 2017.
Case-Laws
GST
Profiteering – restaurant services – food stuff – the quantum of denial of such be
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ITC is available or not
Query (Issue) Started By: – Ankit Jaiswal Dated:- 6-2-2019 Last Reply Date:- 6-2-2019 Goods and Services Tax – GST
Got 4 Replies
GST
Suppose I register in delhi and receiving an architect services for the property situated in haryana from a person registered in delhi and he is charging IGST as per law.
But my doubt is whether ITC is available to a person registered in delhi.
Reply By Spudarjunan S:
The Reply:
Dear Sir,
Prima-facie the eligibility is yes s
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RECENT CHANGES IN GST
By: – DR.MARIAPPAN GOVINDARAJAN
Goods and Services Tax – GST
Dated:- 6-2-2019
Changes in CGST
The following are the changes that are brought in by the Central Government through various notifications-
Amendment to Notification No. 48/2017-Central Tax
The Central Government, vide Notification No.01/2019-Central Tax, dated 15.01.2019 amended the Notification No. 48/2017-Central Tax, dated 18.10.2017 to amend the meaning of 'Advance Authorization'. According to the amendment the supply of goods by a registered person against Advance Authorization is a deemed export provided-
* that goods so supplied, when exports have already been made after availing input tax credit on inputs used in manufacture of such exports, shall be used in manufacture and supply of taxable goods (other than nil rated or fully exempted goods) and a certificate to this effect from a chartered accountant is submitted to the jurisdictional commissioner of GST or any other offi
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tion 28(c)(i) which brings amendment to the Explanation 2 to section 140 of CGST Act.
Amendment to CGST Rules, 2017
The Central Government, vide Notification No. 3/2019-Central tax, dated 29.01.2019 brings amendment to the Central Goods and Services Tax Rules, 2017.
* Rule 7 and 8 are amended;
* Rule 11 is substituted for a new provision which provides for separate registration for multiple places of businesses within a State or a Union Territory;
* A new Rule 21A is inserted which provides for suspension of registration;
* A new Rule 41A is inserted which provides for transfer of credit on obtaining separate registration for multiple places of business within a State or Union territory;
* Rule 42 and 43 are amended;
* Rule 53 is amended and a new sub rule (1A) is inserted which provides the details to be furnished in the debit/credit note;
* Rule 80 is amended;
* Rule 83 is amended sub rule (8) is substituted for a new rule which provides the activites that can be un
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e into effect from 01.02.2019. As per the amendment the eligible registered person, whose aggregate turnover in the preceding financial year did not exceed one crore rupees , may opt to pay, in lieu of the central tax payable by him, an amount of tax calculated at the rate specified in rule 7 of the Central Goods and Services Tax Rules, 2017.
Sl. No.
Category of registered persons
Rate of tax
(1)
(2)
(3)
1.
Manufacturers, other than manufacturers of such goods as may be notified by the Government
half per cent. of the turnover in the State or Union territory
2.
Suppliers making supplies referred to in clause (b) of paragraph 6 of Schedule II
two and a half per cent. of the turnover in the State or Union territory
3.
Any other supplier eligible for composition levy under section 10 and the provisions of this Chapter
half per cent. of the turnover of taxable supplies of goods and services in the State or Union territory
Amendment of Notification No. 65/2017
The Central G
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egrated tax, dated 29.01.2019 amended the Notification No. 07/2017-IGST, dated 14.09.2017, which specifies the job workers engaged in making inter-State supply of services to a registered person as the category of persons exempted from obtaining registration under the said Act. nothing contained in this notification shall apply to a job-worker –
* who is liable to be registered under or who opts to take registration voluntarily under of the said or
* who is involved in making supply of services in relation to the goods mentioned against serial number 5 in the of the
This notification came in to effect from 01.02.2019.
Amendment to Notification No.10/2017-IGST,
The Central Government, vide Notification No.03/2019-IGST, dated 29.01.2019 amended the Notification No.10/2017-IGST, dated 13.10.2017. After amendment this Notification specifies the persons making inter-State supplies of taxable services and having an aggregate turnover, to be computed on all India basis, not exceeding
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e Notification No. 01/2019-Union Territory tax, dated 29.01.2019 appointed 01.02.2019 as the effective date for the provisions in Union Territory Goods and Services Tax (Amendment) Act, 2018.
Changes in UTGST – Rate
The Central Government, vide Notification No.01/2019-Union Territory Tax -Rate, dated 29.01.2019 rescinded the Notification No.08/2017-Union Territory Tax, dated 28.06.2017, which exempted intra-State supplies of goods or services or both received by a registered person from any supplier, who is not registered, from the whole of the Union territory tax leviable thereon under sub-section (4) of section 7 of the said Union Territory Goods and Services Tax Act.
This Notification came into effect from 01.02.2019.
Changes in Compensation Cess
The Central Government, vide Notification No. 01/2019-Goods and Services tax compensation, dated 29.01.2019 appointed 01.02.2019 as the effective date for the provisions in Goods and Services Tax (Compensation to State) (Amendment) Ac
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LALITBHAI NATVARLAL PATEL Versus ADDITIONAL DIRECTOR GENERAL DGGI, AZU
GST
2019 (3) TMI 68 – GUJARAT HIGH COURT – TMI
GUJARAT HIGH COURT – HC
Dated:- 6-2-2019
R/SPECIAL CIVIL APPLICATION NO. 1041 of 2019
GST
MS HARSHA DEVANI AND DR A. P. THAKER, JJ.
For The Petitioner (s) : MR ND NANAVATY, SENIOR ADVOCATE with MR D K TRIVEDI (5283)
For The Respondent (s) : MR ANKIT SHAH (6371)
ORAL ORDER
(PER : HONOURABLE MS.JUSTICE HARSHA DEVANI)
1. Vide orders dated 10.1.2019 passed in FORM GST DRC-22 under sub-rule (1) of rule 159 of the Central Goods and Service Tax Rules, 2017, addressed to the Branch Manager, Axis Bank Ltd. Asarwa Branch, Ahmedabad, the respondent No.1 Additional Director General, DGGI, AZU has attached th
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i respectively are ready and willing to offer their property for attachment in order to secure interest of the Government revenue. The details of the property and the affidavits of the said persons have been annexed along with the rejoinder. Shri Ashwinkumar Jayantibhai Patel has stated on oath that he is the joint owner of the property situated at Block/Survey No.406 (Old No.79), Khata No.502, H. Ra. 1-15-40 Paiki 0-45-58, Village Zak, Taluka Dehgam, District Gandhinagar and the other joint owner of the said property is his brother Jashvantkumar Jayantibhai Patel. He has averred that he hereby offers the said land for its attachment so that the bank accounts of M/s. Nandeshwari Steel Limited can be released. Shri Jashvantkumar Jayantibhai
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the offer made by the petitioner, while releasing the bank accounts, the petitioner may be directed to maintain such amount as the court deems fit, in the said bank accounts.
5. In the light of the above, by way of interim arrangement, the respondent No.1 is directed to release the attachment over the bank accounts of the petitioner referred to hereinabove, subject to Shri Ashwinkumar Jayantibhai Patel and Shri Jashvantkumar Jayantibhai Patel, father and uncle of Mitesh Ashwinkumar Patel, one of the Directors of the company, permitting attachment of the property described hereinabove for release of the bank accounts. Shri Ashwinkumar Jayantibhai Patel and Shri Jashvantkumar Jayantibhai Patel shall also file an undertaking before this court
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M/s H.M. Industrial Pvt. Ltd Versus The Commissioner, Cgst And Central Excise
Income Tax
2019 (2) TMI 1398 – GUJARAT HIGH COURT – TMI
GUJARAT HIGH COURT – HC
Dated:- 6-2-2019
R/Special Civil Application No. 1160 of 2019
Income Tax
Ms. Harsha Devani And Dr. A. P. Thaker, JJ.
Anandodaya S Mishra(8038) for the Petitioner.
Mr Nirzar S Desai(2117) for the Respondent.
Oral Order
Ms. Harsha Devani
1. Mr. Nirzar Desai, learned Senior Standing Counsel for the respondent has tendered affidavit-in-reply of the respondent. The same is taken on record.
2. Heard Mr. A. S. Mishra, learned advocate for the petitioner and Mr. Nirzar Desai, learned Senior Standing Counsel for the respondent.
3. In the light of the decision of
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Corrigendum – Notification No. 105/GST-2, dated the 31st December, 2018
22/GST-2 Dated:- 6-2-2019 Haryana SGST
GST – States
Haryana SGST
Haryana SGST
HARYANA GOVERNMENT
EXCISE AND TAXATION DEPARTMENT
Corrigendum
The 6th February, 2019
No. 22/GST-2.- In the Haryana Government, Excise and Taxation Department, notification No. 105/GST-2, dated the 31st December, 2018, in page 4189, in line 5, for “List 32”, read “List 34”.
SANJEEV KAUSHAL,
Additional Chief Secretary to Governm
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Haryana Goods and Services Tax (Removal of Difficulties) Order, 2019
21/GST-2 Dated:- 6-2-2019 Haryana SGST
GST – States
Haryana SGST
Haryana SGST
HARYANA GOVERNMENT
EXCISE AND TAXATION DEPARTMENT
Order
The 6th February, 2019
No. 21/GST-2.-WHEREAS, Sub-section (1) of Section 10 of the Haryana Goods and Services Tax Act, 2017 (19 of 2017) (hereafter in this Order referred to as the said Act) provides that-
(i) a registered person engaged in the supply of services, other than supply of service referred to in clause (b) of paragraph 6 of Schedule II to the said Act, may opt for the scheme under the said sub-section;
(ii) a person who opts for the said scheme may supply services (other than those referred to in clause (b) o
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small businesses and because of that, certain difficulties have arisen in giving effect to the provisions of section 10;
NOW, THEREFORE, in exercise of the powers conferred by Section 172 of the Haryana Goods and Services Tax Act, 2017 and in supersession of the Haryana Government, Excise and Taxation Department, Order No. 105/ST-2, dated the 13th October, 2017 except as respects things done or omitted to be done before such supersession, the Governor of Haryana, on recommendations of the Council, hereby makes the following Order, namely:-
1. Short title.- This Order may be called the Haryana Goods and Services Tax (Removal of Difficulties) Order, 2019.
2. For the removal of difficulties, it is hereby clarified that the value of supply
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DOWNTOWN AUTO PVT. LTD. Versus UNION OF INDIA
GST
2019 (2) TMI 542 – GUJARAT HIGH COURT – 2020 (32) G. S. T. L. J152 (Guj.)
GUJARAT HIGH COURT – HC
Dated:- 6-2-2019
R/SPECIAL CIVIL APPLICATION NO. 2409 of 2019
GST
MS HARSHA DEVANI AND DR A. P. THAKER, JJ.
For The Petitioner : UCHIT N SHETH (7336)
ORDER
(JUSTICE HARSHA DEVANI)
1. Mr. Uchit Sheth, learned advocate for the petitioner has invited the attention of the court to the provisions of section 140 of the Central Goods and Services Tax Act, 2017 and more particularly sub-section (3) thereof, which inter alia provides that a registered dealer as described therein, a first stage dealer or a second stage dealer or a registered importer or a depot of a manufacture
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M/s GOLDEN COTTON INDUSTRIES Versus UNION OF INDIA
GST
2019 (2) TMI 541 – GUJARAT HIGH COURT – TMI
GUJARAT HIGH COURT – HC
Dated:- 6-2-2019
R/SPECIAL CIVIL APPLICATION NO. 2132 of 2019
GST
MS HARSHA DEVANI AND DR. A. P. THAKER, JJ.
For The Petitioner : MR PARESH V SHETH (3998
ORAL ORDER
(PER : HONOURABLE MS.JUSTICE HARSHA DEVANI)
1. Mr. Paresh Sheth, learned advocate for the petitioner has invited the attention of the court to the provisions of subsection (2) of section 67 of the Central Goods and Services Tax Act, 2017, to submit that in this case, the concerned officer, either pursuant to an inspection carried out under sub-section (1) or otherwise, has reasons to believe that any goods liable to confiscation or
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MOHIT MINERALS PVT. LTD. Versus UNION OF INDIA
GST
2019 (2) TMI 540 – GUJARAT HIGH COURT – 2020 (32) G. S. T. L. J155 (Guj.)
GUJARAT HIGH COURT – HC
Dated:- 6-2-2019
R/SPECIAL CIVIL APPLICATION NO. 2091 of 2019
GST
MS HARSHA DEVANI AND DR A. P. THAKER, JJ.
For The Petitioner (s) : MR JK MITTAL,MR HARDIK P MODH, MR AMIT LADDHA (5344)
For The Respondent (s) : MR NIRZAR S DESAI (2117)
ORAL ORDER
(PER : HONOURABLE MS.JUSTICE HARSHA DEVANI)
1. Mr. J. K. Mittal, learned ad
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HSN CODE & GST RATE OF SCRAP CONVEYOR BELT
Query (Issue) Started By: – VEMULA CHANDRASEKHAR Dated:- 5-2-2019 Last Reply Date:- 6-2-2019 Goods and Services Tax – GST
Got 3 Replies
GST
We are making outward supply of an scrap conveyor belt what should be the HSN code & at what GST Rate it should b sold?
Reply By Rajagopalan Ranganathan:
The Reply:
Sir,
Please indicate the constituent material out of which the conveyor belt is made of. Then only it is possible to classify the waste
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REFUND ON INVERTED DUTY STRUCTURE
Query (Issue) Started By: – Rajesh kumar Dated:- 5-2-2019 Last Reply Date:- 5-2-2019 Goods and Services Tax – GST
Got 1 Reply
GST
R/S
ONE PERSON REGISTER UNDER GST. HIS SALE MANUFACTURE PRODUCT FALL UNDER @ 12% BUT ON INPUT GOODS RATE IS 12 AND 18%. SO IN THIS CASE HOW I CALCULATE OF AMOUNT FOR REFUND UNDER INVERTED DUTY . PLS HELP
Reply By Rajagopalan Ranganathan:
The Reply:
Sir,
According to rule 89 (5) of CGST Rules, 2017, "In the case of refund on account of inverted duty structure, refund of input tax credit shall be granted as per the following formula :-
Maximum Refund Amount = {(Turnover of inverted rated supply of goods and services) x Net ITC ÷ Adjusted Total Turnover
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Cross Border transaction
Query (Issue) Started By: – Yogesh Ashar Dated:- 5-2-2019 Last Reply Date:- 6-2-2019 Goods and Services Tax – GST
Got 5 Replies
GST
Dear Sir
There is logistic movement from a place outside India to a destination outside India. The Service Provider is an Indian Forwarder and the Recipient is an Indian Company. The goods do not touch the shores of India.
1. Whether in view of the Amendment in IGST act , this transaction will be exempt from tax.
2. Whether it can be treated as export as the condition of Service recipient outside India is not fullfilled. The money may be received in foreign currency as transfer from EEFC account by the Service Recipient.
3. Impact due to Sec 7(5) and whether IGST will b
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isfied condition is recipient is not located outside India.
Reply By KASTURI SETHI:
The Reply:
Intelligent interpretation and analysis by Sh.Mahadev R.
Reply By Yogesh Ashar:
The Reply:
Dear Sir
They have added this transaction in Schedule III to the CGST Act. In view of this will it be exempt
regards
Reply By Spudarjunan S:
The Reply:
Dear Yogesh Ashar sir,
Through the CGST Amendment Act, 2018 the entry no.7 which has been added is only for "SUPPLY OF GOODS" the same is extracted below:-
32. In Schedule III of the principal Act, –
(i) after paragraph 6, the following paragraph shall be inserted, namely:
“7. Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without
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INACTIVE GSTN- REVOCATION
Query (Issue) Started By: – Chandra n Dated:- 5-2-2019 Last Reply Date:- 6-2-2019 Goods and Services Tax – GST
Got 4 Replies
GST
Sir
I want to file my returns from september 2018 but the gstin has been cancelled.helpdesk says file returns to revoke.How to file returns when the gstin number is cancelled.I saw in your query one Mr.ravi had the same problem.How to file returns online when it is inactive.matter most urgent
Reply By KASTURI SETHI:
The Reply:
What is the date of cancellation of registration ? A period of 30 days is allowed for filing application revocation of cancellation of registration certificate. Have you applied for revocation within stipulated period ? What I think you could file re
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Changes in GST Act and GST Rules applicable from 01.02.2019
By: – Kumar Kedia
Goods and Services Tax – GST
Dated:- 5-2-2019
The Government notifies the applicability of the following acts from 1st February 2019:-
* CGST (Amendment) Act, 2018 vide notification 2/2019- CGST dated 29.01.2019
* IGST (Amendment) Act, 2018 vide notification 1/2019 – IGST dated 29.01.2019,
* UTGST (Amendment) Act, 2018 vide notification 1/2019- UTGST dated 29.01.2019
* GST (Compensation to States) Amendment Act, 2018 vide notification 1/2019- GST Compensation Cess
Government also notified the corresponding changes in the rules through CGST (Amendment) Rules 2019 vide notification 3/2019- CGST.
It was apprised by the notification that few amendments made by the Acts shall not be made applicable from 01-02-2019 which included the provisions related to new return system and the corresponding changes thereby.
We can say that Government has taken few major steps in making GST a Good and
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ng authority.
Section 2(17)(h)- Definition of Business
“business” includes
* ….
services provided by activities of a race club including by way of totalisator or a license to book maker or activities of a licensed book maker in such club; and
…..
Analysis:-
The amendment is made to confirm that all the activities related to race club are included in the definition of business.
Section 2(18)-Definition of 'Business Vertical'
“business vertical” means a distinguishable component of an enterprise that is engaged in the supply of individual goods or services or a group of related goods or services which is subject to risks and returns that are different from those of the other business verticals.
Explanation.For the purposes of this clause, factors that should be considered in determining whether goods or services are related include
(a) the nature of the goods or services;
(b) the nature of the production processes;
(c) the type or class of customers for t
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rticle 371 and article 371J of the Constitution; or
(g)…..
Analysis:-
* A development Board constituted under Article 371 J shall also be considered local authority.
* The article is inserted in the Constitution for the development of backward areas of Hyderabad-Karnataka region.
Section 2(102)-Definition of 'Service'
“services” means anything other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged;
Explanation.-For the removal of doubts, it is hereby clarified that the expression “services” includes facilitating or arranging transactions in securities.
Analysis:-
* The terms money and securities are excluded from the definition of goods and services as per CGST Act, 2017.
* However, activities relating to use of money are covered in the definition of ser
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line recipient”…….
Explanation.- For the purposes of this clause, the expression “governmental authority” means an authority or a board or any other body,-
(i) set up by an Act of Parliament or a State Legislature; or
(ii) established by any Government,
with ninety per cent. or more participation by way of equity or control, to carry out any function entrusted to a Panchayat under article 243G or to a municipality under article 243W of the Constitution;
Analysis:-
Government added the reference to Panchayat under article 243G in meaning of Governmental authority
Amendment in the Scope of Supply
* Section 7(1) and 7(3)- Scope of Supply
(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 c
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tigations arose on the account that merely if any transaction is covered under Schedule II whether the transaction is deemed to be supply even if it cannot be said to be a supply otherwise.
* The Government therefore omitted clause (d) of Section 7(1) to remove Schedule II from the definition of Supply.
* Further Sub-section (1A) to Section 7 was inserted to state that transactions listed in Schedule II will only be taxed when they constitute supply as per sub-section 1 of Section 7.
* Corresponding change have been made in sub section 3 of Section 7
* This amendment shall be deemed to have been applied from 1-7-2017 i.e. retrospective amendment.
Schedule I- Supply made without consideration
1….
2….
3…
4. Import of services by a taxable person from a related person or from any of his other establishments outside India, in the course or furtherance of business.
Analysis:-
This amendment is made to cover even the unregistered persons who import the se
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r the purposes of paragraph 8, the expression “warehoused goods” shall have the same meaning as assigned to it in the Customs Act, 1962.
Analysis:-
* The Schedule III is amended to insert few such transactions which are outside the preview of Supply which are :-
* Merchant Trading (Supply of goods from Non taxable territory to Non Taxable territory directly)
* Sale of imported warehoused goods i.e. before payment of custom duty.
* High Seas Sales i.e. Sale after dispatch from port outside India but before reaching the destination port in India.
* Further, section 17(3) is amended to provide that no reversal of common credit shall be required in relation to any transactions listed in Schedule III.
Reverse Charge
Section 9(4)- Reverse Charge in case of procurement from Unregistered person
(4) The central tax in respect of the supply of taxable goods or services or both by a supplier, who is not registered, to a registered person shall be paid by such person on reverse char
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) from unregistered person shall be liable to pay tax on reverse charge.
Composition Scheme
* Section 10- Composition levy
(1) Notwithstanding anything to the contrary contained in this Act but subject to the provisions of sub-sections (3) and (4) of section 9, a registered person, whose aggregate turnover in the preceding financial year did not exceed fifty lakh rupees, may opt to pay, in lieu of the tax payable by him under sub-section (1) of section 9, an amount of tax calculated at such rate as may be prescribed, but not exceeding,-
(a) one per cent. of the turnover in State or turnover in Union territory in case of a manufacturer,
(b) two and a half per cent. of the turnover in State or turnover in Union territory in case of persons engaged in making supplies referred to in clause (b) of paragraph 6 of Schedule II, and
(c) half per cent. of the turnover in State or turnover in Union territory in case of other suppliers,
subject to such conditions and restrictions as may b
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erson under composition scheme has to pay tax under reverse charge separately. This change has been given effect by substituting section 9 to Sub-section 1 of section 9.
* Government increased the threshold limit of composition from ₹ 1 Crore to 1.5 Crore in the Act. However, still the notified limit is 1 Crore and is expected to increase from 1- April-2019.
* Prior to amendment, a composition dealer was not allowed to supply services (other than restaurant services). However, this amendment allows supply of services (other than restaurant services) to the limit of 10% of the turnover in a State/ Union Territory in the preceding year or ₹ 5,00,000 whichever is higher.
* Corresponding changes have been done in the form GSTR-4 to give effect to supply of services by a composition dealer.
* However, it should be clarified that this limit is for the supply of taxable services whereas the supply of exempt service along with supply of goods or restaurant service is alread
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o some extent, this amendment is made to give effect to the same.
* Also, a notification 05/2019 dated 29.01.2019 has been issued to align the notified rates of the composition with the rule 7 of CGST rules, 2017.
Time of Supply
* Section 12(2)-Time of Supply of Goods
(2) The time of supply of goods shall be the earlier of the following dates, namely:-
(a) the date of issue of invoice by the supplier or the last date on which he is required, under sub section 1 of section 31, to issue the invoice with respect to the supply; or
(b) the date on which the supplier receives the payment with respect to the supply:
Provided that where the supplier of taxable goods receives an amount up to one thousand rupees in excess of the amount indicated in the tax invoice, the time of supply to the extent of such excess amount shall, at the option of the said supplier, be the date of issue of invoice in respect of such excess amount.
Analysis:-
This amendment is in the view to correct th
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t indicated in the tax invoice, the time of supply to the extent of such excess amount shall, at the option of the said supplier, be the date of issue of invoice relating to such excess amount.
Analysis:-
This amendment is in the view to correct the drafting error to include issue of invoice or other documents contained in Section 31 such as in case of continuous supply of services etc. for the purpose of time of supply.
Input Tax Credit
* Section 16(2)(b)- Conditions for availing ITC
(2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless,
(a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribed;
(b) he has received the goods or services or both.
Explanation.-For the purposes of this clause, it shall be deemed that the registered person ha
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be prescribed, and shall include supplies on which the recipient is liable to pay tax on reverse charge basis, transactions in securities, sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building.
Explanation.-For the purposes of this sub-section, the expression ''value of exempt supply'' shall not include the value of activities or transactions specified in Schedule III, except those specified in paragraph 5 of the said Schedule.
Analysis
An explanation is inserted to clarify that no reversal of common ITC shall be required on activities or transactions specified in Schedule III (other than sale of land and subject to clause (b) of paragraph 5 if Schedule II, sale of building) as it is now excluded from exempt supply.
Section 17(5)-Blocked Credit
(5) Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax credit shall not be available in respect of the following, namely:-
(a) motor vehicles
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raining on navigating such vessels; or
(D) imparting training on flying such aircraft;
(ii) for transportation of goods;
Analysis:-
* ITC is also no available in case of vessels and aircraft except when they are used for above specified purposes.
(ab) services of general insurance, servicing, repair and maintenance in so far as they relate to motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa):
Provided that the input tax credit in respect of such services shall be available-
(i) where the motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) are used for the purposes specified therein;
(ii) where received by a taxable person engaged-
(I) in the manufacture of such motor vehicles, vessels or aircraft; or
(II) in the supply of general insurance services in respect of such motor vehicles, vessels or aircraft insured by him;
Analysis:-
* No ITC shall be allowed for repairing, insurance service in relation to motor vehicles
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le supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;
(ii) membership of a club, health and fitness centre; and
(iii) rent-a-cab, life insurance and health insurance except where
(A) the Government notifies the services which are obligatory for an employer to provide to its employees under any law for the time being in force; or
(B) such inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as part of a taxable composite or mixed supply; and
(iii) travel benefits extended to employees on vacation such as leave or home travel concession:
Provided that the input tax credit in respect of such goods or services or both shall be available, where it is obligatory for an employer to provide the same to its employees under any law for the time being in force.
Analysis:-
* ITC in respect
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ndations of the Council, enhance the aggregate turnover referred to in the first proviso from ten lakh rupees to such amount, not exceeding twenty lakh rupees and subject to such conditions and limitations, as may be so notified;
Analysis:-
Government inserted the proviso in the section to give power to Council to recommend the increase the threshold limit of registration in special category states from 10 lakhs to 20 lakhs.
Explanation (iii) to Section 22
Explanation.For the purposes of this section,
(i)……
(ii)….
(iii) the expression “special category States” shall mean the States as specified in sub-clause (g) of clause (4) of article 279A of the Constitution except the State of Jammu and Kashmir and States of Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand.
Analysis:-
This amendment is made to give effect to increase threshold limit in state of J&K, Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttara
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istration, as distinct from his place of business located outside the Special Economic Zone in the same State or Union territory
Proviso to Rule 8(1) – Application for Registration
(8) (1)…..
"Provided that a person having a unit(s) in a Special Economic Zone or being a Special Economic Zone developer shall make a separate application for registration as a business vertical distinct from his other units located outside the Special Economic Zone:"
Proviso to Section 25(2) – Procedure for Registration
25 (2)……..
Provided that a person having multiple business vertical places of business in a State or Union territory may be granted a separate registration for each such business vertical place of business, subject to such conditions as may be prescribed.
Rule 11- Separate registration for multiple places of business within a State or a Union territory.
11….(Substituted)
(1) Any person having multiple places of business within a State or a U
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registered places of business of the said person shall become ineligible to pay tax under the said section.
(2) A registered person opting to obtain separate registration for a place of business shall submit a separate application in FORM GST REG-01 in respect of such place of business.
(3) The provisions of rule 9 and rule 10 relating to the verification and the grant of registration shall, mutatis mutandis, apply to an application submitted under this rule.
Analysis:-
* The concept of business vertical has been omitted from the act.
* Government has allowed to take the separate registration for each place of business in case of multiple places of business within a state and hence substituted Rule 11 of CGST Rules and amended Section 25.
* It is clarified in Explanation to Rule 11 that if any place becomes ineligible for opting composition scheme, all other places shall also become ineligible for composition scheme.
* It is stated that a person opts normal/ regular scheme f
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ly, the unutilised input tax credit lying in his electronic credit ledger to any or all of the newly registered place of business, shall furnish within a period of thirty days from obtaining such separate registrations, the details in FORM GST ITC-02A electronically on the common portal, either directly or through a Facilitation Centre notified in this behalf by the Commissioner:
Provided that the input tax credit shall be transferred to the newly registered entities in the ratio of the value of assets held by them at the time of registration.
Explanation.- For the purposes of this sub-rule, it is hereby clarified that the 'value of assets' means the value of the entire assets of the business whether or not input tax credit has been availed thereon.
(2) The newly registered person (transferee) shall, on the common portal, accept the details so furnished by the registered person (transferor) and, upon such acceptance, the unutilised input tax credit specified in FORM GST ITC-02A shal
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g to cancellation of registration, the proper officer may suspend the registration for such period and in such manner as may be prescribed.
Rule 21A- Suspension of Registration
(1) Where a registered person has applied for cancellation of registration under rule 20, the registration shall be deemed to be suspended from the date of submission of the application or the date from which the cancellation is sought, whichever is later, pending the completion of proceedings for cancellation of registration under rule 22.
(2) Where the proper officer has reasons to believe that the registration of a person is liable to be cancelled under section 29 or under rule 21, he may, after affording the said person a reasonable opportunity of being heard, suspend the registration of such person with effect from a date to be determined by him, pending the completion of the proceedings for cancellation of registration under rule 22.
(3) A registered person, whose registration has been suspended under
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of registration has been given suo moto or when officer has reasons to believe that registration shall be cancelled.
* A person shall not make any taxable supply during the period of suspension and shall not file any return.
Credit Notes and Debit Notes
* Section 34- Credit Notes and Debit Notes
34. (1) Where a tax invoice was issued one or more tax invoices have been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient a credit note containing such particulars as may be prescribed.
(2) Any registered person who issues a credit note one or more credit notes for supplies made in a financial year in relation to a supply o
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a financial year containing such particulars as may be prescribed.
Rule 53- Revised tax invoice and credit or debit notes
1) A revised tax invoice referred to in section 31 and credit or debit notes referred to in section 34 shall contain the following particulars, namely:-
(a) the word “Revised Invoice”, wherever applicable, indicated prominently;
(b) name, address and Goods and Services Tax Identification Number of the supplier;
(c) nature of the document
(d) a consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets or numerals or special charactershyphen or dash and slash symbolised as “-” and “/” respectively, and any combination thereof, unique for a financial year;
(e) date of issue of the document;
(f) name, address and Goods and Services Tax Identification Number or Unique Identity Number, if registered, of the recipient;
(g) name and address of the recipient and the address of delivery, along with the name of
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que Identity Number, if registered, of the recipient;
(f) name and address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is un-registered;
(g) serial number(s) and date(s) of the corresponding tax invoice(s) or, as the case may be, bill(s) of supply;
(h) value of taxable supply of goods or services, rate of tax and the amount of the tax credited or, as the case may be, debited to the recipient; and
(i) signature or digital signature of the supplier or his authorised representative
Analysis:-
* In Section 34 amendment is made to enable the registered person to issue a single or multiple credit notes or debit notes against multiple invoices.
* Further, Government amended Rule 53 to distinguish the mandatory requirements in the issue of Revised invoice and in the issue of debit note or credit note.
* Revised invoice can be issued in one month of registration for all supplies done from the date on which registratio
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should have been removed.
Accounts and Records
* Proviso to Section 35(5)- Accounts and Other Records
(5) Every registered person whose turnover during a financial year exceeds the prescribed limit shall get his accounts audited by a chartered accountant or a cost accountant and shall submit a copy of the audited annual accounts, the reconciliation statement under sub-section (2) of section 44 and such other documents in such form and manner as may be prescribed.
Provided that nothing contained in this sub-section shall apply to any department of the Central Government or a State Government or a local authority, whose books of account are subject to audit by the Comptroller and Auditor-General of India or an auditor appointed for auditing the accounts of local authorities under any law for the time being in force.
Rule 80(3)-Reconciliation Statement
Every registered person other than those referred to in the proviso to sub-section (5) of section 35, whose aggregate turnover du
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cribed.
Rule 83(8)- Provisions related to GST Practitioners
83(8)…. (Substituted)
(8) A goods and services tax practitioner can undertake any or all of the following activities on behalf of a registered person, if so authorised by him to-
(a) furnish the details of outward and inward supplies;
(b) furnish monthly, quarterly, annual or final return;
(c) make deposit for credit into the electronic cash ledger;
(d) file a claim for refund;
(e) file an application for amendment or cancellation of registration;
(f) furnish information for generation of e-way bill;
(g) furnish details of challan in FORM GST ITC-04;
(h) file an application for amendment or cancellation of enrolment under rule 58; and
(i) file an intimation to pay tax under the composition scheme or withdraw from the said scheme:
Provided that where any application relating to a claim for refund or an application for amendment or cancellation of registration or where an intimation to pay tax un
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the same and the application shall be processed after his approval.
Second Proviso to Rule 83(3)- Provisions related to GST Practitioners
Provided that….
Provided further that no person to whom the provisions of clause (b) of sub-rule (1) apply shall be eligible to remain enrolled unless he passes the said examination within a period of eighteen thirty months from the appointed date.
Analysis:-
* Amendment in Rule 83(3) is made to increase the time limit for passing the GST exam for the persons who were enrolled as sales tax practitioner or tax return preparer under the previous law for a period of not less than five years.
* The date for passing the GST exam for persons mentioned in above point have been increased from 18 months from appointed date i.e. 31st December, 2018 to 30 months from appointed date i.e. 31st December, 2019.
Payment of Tax
* Section 49(5)- Payment of Tax
(5) The amount of input tax credit available in the electronic credit ledger of the
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vide that credit of SGST/UTGST will be used against the payment of IGST only after full utilisation of the credit of CGST or when balance of ITC on account of CGST is not available for the payment of IGST.
Section 49A- Utilisation of ITC subject to certain conditions
Notwithstanding anything contained in section 49, the input tax credit on account of central tax, State tax or Union territory tax shall be utilised towards payment of integrated tax, central tax, State tax or Union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment.
Analysis:-
New Section 49A is inserted to provide that if ITC of IGST is available then at first, it has to be exhausted wholly by the payment of IGST or CGST or SGST and then only ITC of CGST and SGST can be used for the payment of IGST, CGST and SGST as the case may be subject to the condition that CGST and SGST cannot be cross utilised for the pay
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nstead of being credited to the Fund, be paid to the applicant, if such amount is relatable to-
* refund of tax paid on zero rated supplies export of goods or services or both or on inputs or input services used in making such zero rated supplies export;
* …….
Rule 89(2)(f)- Application for refund of tax
(2) The application under sub-rule (1) shall be accompanied by any of the following documentary evidences in Annexure 1 in Form GST RFD-01, as applicable, to establish that a refund is due to the applicant, namely:-
(a)….
(f) a declaration to the effect…. (Substituted) a declaration to the effect that tax has not been collected from the Special Economic Zone unit or the Special Economic Zone developer, in a case where the refund is on account of supply of goods or services or both made to a Special Economic Zone unit or a Special Economic Zone developer.
Analysis:-
* Section 54(8) provides with the situations where Refund of Tax can be claimed by
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context, If a person supplying goods to SEZ unit or SEZ Developer is applying for refund than a declaration in this regard shall be required that no tax has been collected from SEZ unit on account of such supply.
* Corresponding changes have also been made in GST RFD-01 and GST-RFD 01A.
Explanation 2(e) to Section 54- Relevant Date for Refund of Unutilised ITC
(e) (e) in the case of refund of unutilised input tax credit under sub-section (3), the end of the financial year in which such claim for refund arises in the case of refund of unutilised input tax credit under clause (ii) of the first proviso to sub-section (3), the due date for furnishing of return under section 39 for the period in which such claim for refund arises;
Analysis:-
Relevant date for claiming refund of unutilised ITC in case of inverted duty structure shall be the due date for furnishing of return for the period in which such claim for refund arises.
Rule 91- Grant of provisional refund
(2) The proper
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revalidated where the refund has not been disbursed within the same financial year in which the said payment advice was issued.
Analysis:-
Government inserted the proviso to Rule 91(2) and Rule 91(3) to provide that in the case where refund is not disbursed, the order issued by officer in GST RFD-04 form for grant of provisional refund shall not be revalidated and only payment advice issued in FORM GST RFD 05 shall be revalidated if refund is not disbursed within same financial year in which said payment advice was issued.
Rule 92- Order Sanctioning Refund
(4) Where the proper officer is satisfied that the amount refundable under sub-rule (1) or sub-rule (2) is payable to the applicant under sub-section (8) of section 54, he shall make an order in FORM GST RFD-06 and issue a payment advice in FORM GST RFD-05 for the amount of refund and the same shall be electronically credited to any of the bank accounts of the applicant mentioned in his registration particulars and as specified
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Undertaking in FORM GST RFD-11 to the jurisdictional Commissioner, binding himself to pay the tax due along with the interest specified under sub-section (1) of section 50 within a period of –
(a) fifteen days after the expiry of three months, or such further period as may be allowed by the Commissioner, from the date of issue of the invoice for export, if the goods are not exported out of India; or
(b) fifteen days after the expiry of one year, or such further period as may be allowed by the Commissioner, from the date of issue of the invoice for export, if the payment of such services is not received by the exporter in convertible foreign exchange or in Indian rupees, wherever permitted by the Reserve Bank of India
Analysis:-
RBI has permitted the use of Indian Rupees as mode of payment for export to Nepal and Bhutan.
Amendment to insert payment of export of services in Indian Rupees wherever permitted by RBI is done to align with the above permission.
Point to be noted: Same a
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l, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and
(b) a sum equal to ten per cent of the remaining amount of tax in dispute arising from the said order subject to a maximum of twenty-five crore rupees, in relation to which the appeal has been filed.
Section 112(8)- Appeals to Appellate Tribunal
(8) No appeal shall be filed under sub-section (1), unless the appellant has paid
(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him, and
(b) a sum equal to twenty per cent of the remaining amount of tax in dispute, in addition to the amount paid under sub-section (6) of section 107, arising from the said order subject to a maximum of subject to a maximum of fifty crore rupees, in relation to which the appeal has been filed.
Analysis:-
* As per the amendment in Section 107(6) an appellant shall pay 10% of the disputed tax amo
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all be initiated in accordance with the provisions of section 130.
Analysis:-
Amendment is made to increase the time limit for a person to pay tax on detention of goods from 7 days of such detention to 14 days of such detention.
Transitional Provisions
Section 140(1)- Detention, seizure and release of goods and conveyances in transit
1) A registered person, other than a person opting to pay tax under section 10, shall be entitled to take, in his electronic credit ledger, the amount of CENVAT credit of eligible duties carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law in such manner as may be prescribed
Explanation 1.-For the purposes of sub-sections [(1)* (not yet notified)], (3), (4) and (6) the expression “eligible duties” means-
(i)…
(iv) the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 197
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anation 2.
* It is further clarified that 'eligible duties and taxes' shall exclude any tax or cess not specified under Explanations 1 and 2 and it shall also exclude any cess which is collected as additional duty of customs under sub-section (1) of Section 3 of Customs Tariff Act, 1975.
Job Work
Second Proviso to Section 143(1) – Job Work procedure
(1) A registered person (hereafter in this section referred to as the “principal”) may under intimation and subject to such conditions as may be prescribed, send any inputs or capital goods, without payment of tax, to a job worker for job work and from there subsequently send to another job worker and likewise, and shall,-
(a) bring back inputs, after completion of job work or otherwise, or capital goods, other than moulds and dies, jigs and fixtures, or tools, within one year and three years, respectively, of their being sent out, to any of his place of business, without payment of tax;
(b) supply such inputs, after completion o
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* Section 12(8) of IGST Act- Place of supply of Transportation Services
(8) The place of supply of services by way of transportation of goods, including by mail or courier to,-
(a) …
(b) ……
Provided that where the transportation of goods is to a place outside India, the place of supply shall be the place of destination of such goods
Analysis:-
A new proviso is inserted in Section 12(8) of IGST in order to boost the export that in case of goods supplied from a place in India to a place outside India by a registered person located in India, the place of supply shall be outside India.
Section 13(3) of IGST Act- Place of supply of performance based services
(3) The place of supply of the following services shall be the location where the services are actually performed, namely:-
(a)…
(b)…
Provided that….
Provided further that nothing contained in this clause shall apply in the case of services supplied in respect of goods which are
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Amendment in Notification No. (1-W/2018) KGST.CR.01/ 17-18, dated the 29th November, 2018
2/ 2019 No. KGST.CR.01/17-18 Dated:- 5-2-2019 Karnataka SGST
GST – States
Karnataka SGST
Karnataka SGST
Office of the Commissioner of Commercial Taxes (Karnataka)
Vanijya Therige Karyalaya, Gandhinagar, Bengaluru,
NOTIFICATION (2/ 2019)
No. KGST.CR.01/17-18, Bengaluru, Dated: 05.02.2019
In exercise of the powers conferred by sub-section (6) of section 39 read with section 168 of the Karna
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In Re: M/s. Jotun India Pvt. Ltd.
GST
2019 (3) TMI 434 – APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA – 2019 (22) G. S. T. L. 581 (App. A. A. R. – GST)
APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA – AAAR
Dated:- 5-2-2019
MAH/AAAR/SS-RJ/17/2018-19
GST
SMT. SUNGITA SHARMA, AND SHRI RAJIV JALOTA, MEMBER
PROCEEDINGS
(Under Section 101 of the Central Goods and Services Tax Act, 2017 and the Maharashtra 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 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 provisions under the MGST Act.
The present appeal has been filed under Section 100 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and M
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vailing exemptions when granted under respective legislation.
D. With the introduction of GST, Appellant has analyzed classification and applicability of CGST, SGST and IGST in light of new legislation. For classification, it has been clarified in the rate notification of respective legislation that rule of interpretation of the First Schedule to the Customs Tariff Act, 1975 including Section Notes and Chapter Notes and general explanatory notes of the said first schedule would be applicable for the purpose of the classification under GST.
E. Accordingly, Appellant has sought to classify paints being supplied under HSN 3208 and 3209 basis the nature of the product and after considering relevant chapter notes and Section notes. Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017 prescribe applicable rate of CGST. Paint supplied by the Appellant classifiable under chapter heading 3208 and 3209 are covered under Schedule VI of the said Notification and accordingly were liable to
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I has been rejected. Hence, the Appellant has preferred an appeal before this Appellate
Authority against the impugned Advance Ruling.
GROUNDS OF APPEAL
1. The Appellant submitted that marine paint is a specific type of paints suitable for use principally for ships during building stage and even during maintenance. The sailing ship needs protection from corrosive environment in which they operate. Such marine corrosion has a significant impact on sea carriers and their longevity. Therefore, effective corrosion control strategies are chosen considering appropriate selection of coating for a marine environment. Marine coatings have special functionality to protect marine vessels and other carriers above and below the waterline. Accordingly, marine paints supplied by them has following technical features:
* Protects the body of ship from highly corrosive environment
* Blocks barnacles and other marine organisms from adhering to the hulls of ships
* Lessens fuel consumption as it
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y modified natural polymers or chemically modified natural polymers dispersed or dissolved in a non-aqueous medium; solutions as defined in Note 4 to this Chapter”
5. It is submitted that based on the technical specification of the product, marine paints appear to be classifiable under heading 3208. Since, marine paint is suitable for use for ships, it could also get classified as part of ship. For the purpose of this analysis, Appellant referred to chapter 89 for 'Ships, boats and floating structure'. They further submitted that there is no specific entry in Chapter 89 for 'parts' of ships covered therein. In the absence of any entry for part of ship, Appellant had adopted classification of marine paint under chapter heading 3208.
6. The Appellant has also been adopting similar classification under Central Excise Law. The excise duty liability has accordingly been discharged by Appellant under erstwhile Indirect Tax regime.
7. It is submitted that marine paints are suitable princip
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ther vessels, including warships and lifeboats other than rowing boats
251
8907
Other floating structures (for example, rafts, tanks, coffer-dams, landing-stages, buoys and beacons)
8. It is submitted that on conjoint reading of above entries, it could be construed that the aforementioned goods along with its parts (covered under entry 252) would be taxed at the rate of 2.5%. It is to be noted here that Entry 252 reproduced above is applicable to goods falling under any chapter but which are parts of goods falling under headings 8901, 8902, 8904, 8905, 8906 and 8907. Accordingly, a product which is classifiable under any chapter, if could be construed as part of these prescribed goods then the same would fall within the purview of entry 252 and hence would be liable to 2.5% CGST.
9. It is submitted that similar view was adopted by the Hon'ble Court in the case of Mahindra & Mahindra Ltd. vs Commissioner of C. Ex., Nagpur [2007 (210) E.L.T. 579 (Tri. – Mumbai)] = 2006 (12) TMI 289
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at there is no separate tariff item as 'parts of ship' under chapter 89 of the First Schedule to Customs Tariff Act, 1975. Thus, meaning of the term 'parts of goods', could then be adopted from its meaning in common parlance.
13. It is submitted that the said term 'Part' means an essential ingredient of the main product. The said word i.e. part has been defined in various dictionaries as under: The term 'Part' as defined under The Black's Law Dictionary
'an integral portion, something essentially belonging to a larger whole, that which together with another or others makes up a whole.
Definition of 'Part' from Thesaurus
'an essential or integral attribute or quality'
The meaning of the term 'part' in common parlance is that component part of an article is an integral part necessary to the constitution of the whole article and without it, the article will not be complete'.
14. It is submitted that it could be understood that anything which is an integral element and is also essent
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part or replacement part is an interchangeable part that is kept in an inventory and used for the repair or replacement of failed units. Spare parts are an important feature of Logistics Engineering and Supply Chain Management.”
16. It is submitted that also as per the above definitions referred by the Ld. AAR, it is clear that part is one of the piece or ingredient of the main machine. In the present case, ship is main machine and marine paint is essential part of the same.
17. It is further submitted that the Ld. AAR has observed that anchor, bow etc. are very essential parts of the ship or vessel and are quite clearly part of the vessel. However, in addition to the above there are some additional equipment that are required to be made available on a ship as a measure of statutory compliance under the various marine acts. Though these parts are very essential, cannot come under the essential parts or equipment of a vessel/ship.
In this regard, it is submitted that the courts in v
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st suited to serve the national interests. This Act provides registration, certification, safety and security provisions for Indian ships and generally deals with amendments law relating to merchant shipping.
21. It is submitted that as per the provisions of Merchant Shipping Act, 1958 ('MS Act'), marine paint is essential part of the ships. Relevant provisions of the said act which would help in demonstrating that marine paint is integral and essential component of ship as referred below for ease of reference.
* Section 356P(1) of MS Act: Application of chapter XIB-Control Of Harmful Anti-Fouling Systems On Ships
Save as otherwise provided in this Part, this Part shall apply to-
a. every Indian ship, wherever it is;
b. ships not entitled to fly the flag of India, but which operate under the authority of India; and
c. ships that enter a port, shipyard, or offshore terminal or place in India or within the territorial waters of India or any marine areas adjacent there
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all comply with requirements of the anti-fouling systems as prescribed from time to time.
Section 356X of MS Act Information regarding contravention of the provisions of Convention
1. If, on receipt of a report from a surveyor or other person authorised to inspect a ship, the Director-General is satisfied that any provision of this Part has been contravened by such ship within the coastal waters, the Director General or any officer authorised by him in this behalf, may-
a. detain the ship until the causes of such contravention are removed to the satisfaction of the Director-General or the officer authorised by him; and
b. levy penalty on such ship as specified in section 436
22. It is submitted that from conjoint reading of the above provisions, it is evident that every ship has to adhere to the anti-fouling provisions as prescribed under MS Act. Basis the same, a layer of coating or paint, has to be applied on the hull of the ship to control or prevent attachment of unwanted o
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nder 2.5% CGST Rate schedule.
A PRODUCT ESSENTIAL TO COMPLETE THE MAIN PRODUCT AND MAKE IT MARKETABLE IS CONSTRUED AS PART OF THE MAIN PRODUCT
25. Reliance is placed in this regard on the decision of the Hon'ble Supreme Court, in case of Star Paper Mills Ltd. Vs. Collector of Central Excise, Meerut [1990] 76 STC 312 (SC) = 1989 (8) TMI 78 – SUPREME COURT OF INDIA, wherein it has been ruled that if it is found that the use of paper core is necessary in “any process incidental or ancillary to the completion of “paper as marketable goods and it would consequently be commercially inexpedient to sell paper without the use of paper core, it would certainly be a constituent part of paper and would thus fall within the purview of the term “component parts” used in the notification.
26. Reliance is also placed on the decision of Hon'ble Gujarat High Court, in case of Surgichem Vs. State of Gujarat [1992] 87 STC 40 (Guj) = 1991 (7) TMI 303 – GUJARAT HIGH COURT wherein it has been observed tha
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er. Anything required to make the goods marketable, must form part of the manufacture and any raw material or any materials used for the same would be component part for the end product.
28. It is submitted that from the above cases, it could be summarized that paper core, plastic spools and wrapping paper would be considered to be parts of paper rolls, adhesive plaster tapes and paper reams/reels respectively since without the former goods, the later goods couldn't be marketed or are commercially inexpedient. Thus an analogy could be drawn that anything which is required for making goods marketed or to be marketable, would be form component part of that end products.
29. It is submitted that, as explained above, basis the provisions of The Merchant Shipping Act, ships are bound to adhere to the 'anti-fouling system' norms. Accordingly, ship would not be marketable unless the same has complied with anti-fouling system i.e. application of paints / coating to avoid growth of unwanted o
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er wires and cables manufactured for aircrafts / helicopters would be considered as parts of aircraft, the Hon'ble Court in case of Sanghvi Aerospace (P) Ltd Vs. Commissioner of Central Excise Ahmedabad[2009 (247) E.L.T. 578 (Tri. – Ahmd.)] = 2009 (6) TMI 808 – CESTAT, AHMEDABAD stated that following:
“he has also submitted a list of goods in respect of which exemption has been allowed to manufacturers supplying the goods to National Aerospace Laboratories, HAL etc. as detailed below :
9.1 Aircraft cables (manufacturer – Radiant Cables Pvt. Ltd.)
9.2 Paints (manufacturer – South Field Paints & Chemicals Pvt. Ltd.)
9.3 Expoxi Yellow Primer (manufacturer – South Field Paints & Chemicals Pvt. Ltd.)
9.4 Thinner for yellow primer (manufacturer – South Field Paints & Chemicals Pvt. Ltd.)
9.5 Rivets (manufacturer – M/s. Ankit Forgings)
9.6 Epoxi black paint (manufacturer –
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No. 44/2015-CE dated 24 November 2015 has issued prescribing effective rate of central excise for specified goods (amending Notification 12/2012 dated 17 March 2012). Said notification inserted following entry for prescribing effective rate of excise for goods mentioned therein.
Sr. No.
Chapter or heading or sub-heading or tariff item of the First Schedule
Description of excisable goods
Rate
Condition No.
306C
Any chapter
Raw materials and parts
NIL
2 and 3*
* Condition 2 – Where such use is elsewhere than in the factory of production, the exemption shall be allowed if the procedure laid down in the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2001, is followed.
*Condition 3 – The exemption shall be allowed if it has been proved to the satisfaction of an officer not below the rank of the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, having jurisdic
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le I of IGST Rate notification vide entry 246 to 251. Whereas separate entry 252 has been inserted for parts of these goods. Thus, the intention appears to be to avoid inverted duty rate structure for vessel manufacturers. They should be able to procure all the parts at 5% IGST and then would also be charging same rate on their outward supply of different types of vessels. Hence, entry 252 of IGST Rate notification should be read to cover all raw materials and parts which are meant for use in manufacture of different types of vessels.
VAT legislation of United Kingdom also considers paint as part of ship
39. It is submitted that Value Added Tax (VAT) was introduced in the UK on April 1, 1973. Although Value Added Tax Act 1994 (VATA) provides the main framework of the tax, the detailed interpretation of the same are found in statutory instruments either in the form of Orders made by Treasury or Regulations made by Her Majesty's Revenue and Customs (HMRC). HMRC has published several No
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20, 2011
7.5. Which parts and equipment are excluded from zero rating?
Any raw or bulk materials, partly processed parts or equipment and also non-specialist goods or appliances are excluded from zero rating. The list below gives examples of other parts and equipment which are not zero-rated. It is not exhaustive.
* Binoculars
* catering equipment (domestic)
* crockery
* cutlery
* diving equipment
* furniture (unfixed)
* laundering equipment (domestic)
* missiles, shells etc
* ship's stores
* soft furnishings
* phones
* televisions
* tools
* underwater cameras
* videotapes/disks, electronic games and similar entertainment equipment
* crockery and cutlery
* raw materials such as: fibre board, plastics, and specialist metals
* bulk materials such as: adhesives, chemicals, fabrics, inhibitors, metals, oils, paints, solvents and thinners etc
* aircraft ground equipment
* flight simulators or their parts, and
* tooling and equipment used for manu
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d be considered to be parts and equipment of a ship. Therefore under VAT Notice 744C, the UK government has prescribed a non-exhaustive list of parts and equipments which are not zero-rated. The said non-exhaustive list of parts and equipments includes paints, solvent and thinners.
43. It is submitted that from the above it is clear that paints, solvent and thinners have been considered to be parts and equipments of a ship since it is reported under a non-exhaustive list of parts and equipments.
VIOLATION OF PRINCIPLES OF NATURAL JUSTICE.
44. In support of its contentions, the Appellant replied upon the various cases. At the time of the passing of the impugned advance ruling, the Ld. AAR, relied upon various case laws different that the cases referred by the Appellant. However, the Appellant was not given chance of representing its case in light of those decisions referred by the Ld. AAR. Such act of the Ld. AAR is clearly violation of the principles of natural justice.
45. It is s
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Marine paints is classified under schedule entry E-1, Powder coating chemicals are classified under schedule entry C-54 i.e Industrial inputs @ 5%
5) Under Excise the goods are classified under Chapter-32, The rate of tax is 12 %
6) Under GST the goods are classified under schedule – IV @ 14+14=28 %(SGST+CGST)
7) Going by the principle of RNR i.e VAT+ Excise =13.5+12=25.5 hence the goods are classified @ 28 %.
8) Dealer's contention is to classify the goods under SCH-I, serial no.252 parts of goods of heading-89
9) In the ARA Maharashtra application, the dealer has contended the above claims of 5% on following grounds
i) Section 356 of Merchant shipping Act, 1958 – Anti-fouling paints just because it is mandatory under some law to be applied to ships does not essentially make it a part. On this issue, ARA Maharashtra has clearly clarified that paints can be consumables and not parts. As per this law although application of paints is mandatory but that doesn't mean that it can
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the meaning of an expression (Part) as defined in the dictionary and adopted by the courts mentioned above besides common parlance test, it can be safely concluded that Marine Paint is not a component part of Ship. This conclusion which we have drawn as above gets support from the facts stated by the appellant and detailed discussions above as per which marine paints are clearly consumable items and not parts.
v) Thus we would be stretching the definition of 'part' greatly, if we intend to treat paints as parts of ship in view of the above discussions.
vi) Basis 30(2) of UK VAT Act, the ARA has mentioned that the statutory provisions, conditions are in different context and therefore not relevant in the facts of the case in present matter.
DISCUSSION AND FINDINGS
47. We have perused the record of the file and gone through the facts of the case and the submission made by the appellant and the department. The appellant have submitted that they are manufacturers and exporters of pai
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, the question raised by the appellant before the AAR is as follows:-
“Whether marine paints, supplied by the appellant, would be considered to be a part of ship and accordingly be then classified under Sr.No.252 of Schedule-I of the Notification No.1 of 2017 of Central Tax (Rates) dt.28.06.2017.”
48. There is no dispute that the product is covered by Chapter heading 3208 and 3209 but the dispute pertains to the claim of the appellant that they are covered by Entry no.252 of Schedule I Notification No. 1 of 2017 dt.28.06.2017, which covers parts (classifiable under any chapter) of goods, falling under heading 8901,8902,8904, 8905,8906 and 8907 i.e. 'parts of ships'. The appellant has submitted that the impugned product sold by them i.e. Marine Paint is a specific type of paint suitable for use principally for ship during the building stage and during maintenance. The ship needs protection from the corrosive environment in which they operate and the marine coatings are a special funct
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t can be considered to be a part of headings 8901, 8902, 8904, 8905, 8906, 8907 which are all various types of water vessels. In common parlance, paints generally means any liquid which is commonly applied to a number of surfaces and is used to provide texture to an object as well as protect the surfaces. The paint supplied by the appellant is 'anti fouling paint' which is generally applied to hulls of ships. In order to address the contention of the appellant, it is to be seen as what is understood by the meaning of the term 'parts'. The terms 'parts' has not been defined under CGST Act. It has been defined under the Black's Law Dictionary as an 'integral portion, something essentially belonging to a larger whole which together with another or others makes of a whole. In the Cambridge English Dictionary 'part' is defined as a separate piece of something or a piece that combines with other piece to form something. Thus, what we understand from the term 'part' is that it should be ident
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ally required but it will be a little farfetched to say that the ship would be unable to sail without it. A marine paint adds to the life, convenience and efficiency but is certainly not a part of it. Paints have an identity of their own and are not perceived as a part of a setting on which they are applied and this would apply even to the special category of 'Marine paints'.
52. The main contention of the appellant is that as per the provisions of the Merchant Shipping Act, paints are mandatorily required on all ships and therefore they should be considered as part of ships. This may be mandatory requirement for the sail worthiness of the ship but that does not indicate that they are parts of the ship. The mandatory requirement under some other law cannot be an adequate ground for classifying a product as 'part'.
53. The Appellant has placed reliance on the Supreme Court decision in the case of Star Paper Mills v. Collector of Central Excise (1990) 76 STC 317 (SC) = 1989 (8) TMI 78
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hich makes whole marketable product is held to be a 'part'. Therefore, they are not applicable to the instant case.
54. The appellant also referred to the Gujarat High Court Judgment in the case of Surgichem (1992) 87 STC 40 (Guj) = 1991 (7) TMI 303 – GUJARAT HIGH COURT where it was observed that, anything that goes into the product till the product become marketable such things becomes part and parcel of that article. Applying this test, the plastic pools over which plastic tapes are wrapped were considered as part of the goods marketed. A plastic tape could never have become marketable without a plastic pool and therefore the decision. The same cannot be said about paints.
55. The Bombay High Court in the case of Commissioner of Sales Tax Vs. Jayanand Khira & Co. Private Ltd. (36 STC 242 Bom) = 1975 (2) TMI 97 – BOMBAY HIGH COURT had to decide whether an oil tanker is a part of a motor vehicle. The Court observed ,”
“…We find some difficulty in accepting the test laid down in th
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f being put as found by the Tribunal, has both an independent existence and an independent use, apart from being a part of a complete motor oil-tanker. It is, therefore, not possible to hold on the facts as found by the Tribunal that the oil-tank sold by the respondents was a component part of a motor vehicles.
56. In the case of Commissioner, Sales Tax v. Free India Cycle Industries [1970] 26 STC 428 = 1970 (2) TMI 107 – ALLAHABAD HIGH COURT the Allahabad High Court was concerned with an entry “bicycles, tricycles, cycle rickshaws and perambulators and parts and accessories thereof other than tyres and tubes”. The assessee was a dealer in cycle and cycle goods and the question arose whether rexine saddle covers manufactured and sold by it would fall within that entry. It was observed by the Division Bench that the expression “parts and accessories” qualified the word “bicycles, tricycles, etc.” The entry was regarded as referring to parts and accessories of the vehicles and did not i
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therefore, would fall under Schedule Entry C-ll-126 which was a residuary entry for electronic items. The Commissioner in determination order inter alia held that the impugned product was specifically required for Cable TV and therefore, it was covered by Schedule Entry No.C-II-124 as an accessory of the Cable TV. Thus, having regard to the functional utility of the product, the Commissioner held that the Hybrid Amplifiers were covered by Schedule Entry
No.C-II-124 and liable to tax at 13%.
Schedule Entry C-ll-124 read thus :-
Entry Description of the goods Television sets, television cameras, television receivers, to date television monitors, antennas and components, parts and accessories of any of them.
The Court observed,”
. 'From all these facts, what becomes clear is that the Hybrid Amplifier basically boosts the signal, be it for the purpose of transmission of Cable TV or for several other purposes as set out by us earlier. This being the position, we agree with the finding
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In Re: M/s Prabhat Gudakhu Factory
GST
2019 (2) TMI 1525 – AUTHORITY FOR ADVANCE RULINGS, ODISHA – 2019 (23) G. S. T. L. 316 (A. A. R. – GST), [2019] 66 G S.T.R. 446 (AAR)
AUTHORITY FOR ADVANCE RULINGS, ODISHA – AAR
Dated:- 5-2-2019
06/Odisha-AAR/2018-19
GST
SRI ANAND SATPATHY, AND SRI NILANJAN PAN, IRS, MEMBER
Present for the Applicant -RAVI SHANKAR SISTLA, CA
Subject: GST Act, 2017-Advance Ruling U/s 98 on 'Classification of GUDAKHU'
1.0 M/s. Prabhat Gudakhu Factory, Jeypore, Koraput, Odisha, 764005(hereinafter referred to as the 'Applicant') assigned with GSTIN 21AACHA8243B272 having registered address At-Jyoti Mill Campus, Souraguda, Jeypore, Koraput, Odisha-764005 have filed an application on 08.11.2018 under Section 97 of CGST Act, 2017 & OGST Act, 2017 read with Rule 104 of CGST Rules 2017 & OGST Rules, 2017 in Form GST ARA-01 seeking an Advance Ruling on (i) 'Appropriate Classification of Gudakhu' under the GST Tariff Heading and (ii) 'Determination of
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hu is covered under the classification code 2403 11 10. The applicant substantiated such view as below.
2.1. The Hon'ble Odisha High Court has held in the case of Shamsuddln Akbar Khan and Co. as reported in 35 STC 179 = 1974 (7) TMI 114 – ORISSA HIGH COURT that “gudakhu is a kind of manufactured tobacco like cigarettes, cigars, cheroots, biri, chewing tobacco, and snuff and was very much akin to hookah tobacco”. Placing reliance on the aforesaid observations of the Hon'ble Court the applicant is of the view that Gudakhu should be classified under the HSN Code 2403 11 10 and having been specifically covered under this code, the same cannot be classified under the residual code of 2403 99 90 (All other products),
2.2 The residual code of 2403 9990 contains all other tobacco products in the nature of gutkha which are meant for chewing. The description of HSN classification 2403 9990 reads as “All goods, other than pan masala containing tobacco 'gutkha'… Therefore, the said classifica
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submission reiterating the stand taken earlier. In his considered opinion “Gudakhu” should be classified under the tariff heading ' 240311 10' and substantiated the argument by placing reliance upon a case decided by Hon'ble High Court of Odisha reported in 35 STC 179 = 1974 (7) TMI 114 – ORISSA HIGH COURT in the case of Shamsuddin Akbar Khan and Co.
4.0 We have considered the submissions made by the applicant in its application for advance ruling as well as the submissions made by the representative during personal hearing. We also considered the question & issues on which advance ruling is sought for by the applicant, relevant facts having bearing on the question / issue raised and the Applicant's understanding/interpretation of law in respect of the issue
4.1 In the instant application, Ruling has been sought for (i) 'appropriate classification of Gudakhu' under GST Tariff heading and (ii) 'Determination of the liability to pay NCCD (National Calamity Contingency Duty)'. The appli
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. Most of its composition materials are similar to Gutkha except areca nut. It is primarily applied on teeth and pressed and chewed. So, it should be, and rightly classified, under heading 'Other' with Sub- heading 'Other2403 99' and Tariff-head 'Other 2403 99 901 since it is entirely different by essential character by following general rules of interpretation from the tariff items 2403 11 10.
4.3 For ease of reference the classification of both the Tariff-item heading is reproduced below:
“2403 Other manufactured tobacco and manufactured tobacco substitutes; “Homogenized” or “Reconstituted” tobacco; tobacco. extracts and essences
-Smoking tobacco, whether or not containing tobacco substitute in any proportion:
2403 11 Water pipe tobacco specified in Sub )heading Note to this chapter:
2403 11 10 Hookah or Gudakhu Tobacco
-Other
2403 99 0ther
2403 99 10 – Chewing tobacco
2403 99 20 – Preparations containing chewing tobacco
2403 99 30 – Zarda scented tobacco
240
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the applicant is sold as a paste and is used as a tooth paste. Hence, it is distinctly different from hookah tobacco by its essential character and use. While hookah or gudakhu tobacco as classified under 2403 11 10 is used as a smoking tobacco through a water pipe, gudakhu manufactured by the applicant is sold in the form of a paste for use as a tooth paste and not as a smoking tobacco. In the scheme of classification of tobacco product for the purpose of assigning HSN Code under tariff sub-heading 2403 11, only water pipe tobacco intended for smoking in a water pipe are included and not any other form of tobacco. As explained above, the applicant is engaged in the manufacture of gudakhu in paste form only which is used only as a tooth paste and never used for smoking in a water pipe. As a result, it can never be classified under tariff sub-heading 2403 11.
4.5 As per the scheme of classification, tariff sub-heading 2403 99 is a residual sub-heading under which all forms of che
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the sub-heading 2403 99 only if the said item belongs to the family of chewing tobacco like 'gutkha', zarda or khaini is totally misplaced in as much as the said sub-heading also specifies other tobacco products such as cut tobacco, tobacco extracts and snuff etc. Therefore, the general rule of classification as relied upon by the applicant cannot be applied in the case of gudakhu as manufactured and sold by the applicant simply because it does not belong to the family of chewing tobacco such as zarda and gutkha.
4.6. Gudakhu as manufactured by the applicant is certainly not classified under any specific tariff item in any of the sub-headings under the Heading 24 03. Accordingly, it can be classified and rightly so under the residual tariff item 2403 99 90 – other' of the said Chapter Heading because of its composition, character and use.
4.7. As regards 'Determination of the liability to pay NCCD (National Calamity Contingency Duty)', it is clarified that the aforesaid duty is a le
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The Commissioner, Central Excise And Central Gst Versus M/s Kurele Chemical Co.,
Central Excise
2019 (2) TMI 671 – ALLAHABAD HIGH COURT – 2019 (366) E.L.T. 657 (All.)
ALLAHABAD HIGH COURT – HC
Dated:- 5-2-2019
Central Excise Appeal No. – 24 of 2018
Central Excise
Bharati Sapru And Piyush Agrawal JJ.
For the Appellant : Gaurav Mahajan
For the Respondent : Prateek Dawar,Pragya Pandey,Prateek Dawar
ORDER
PIYUSH AGRAWAL, J.
We have heard Sri Gaurav Mahajan, learned counsel for the appellant and Sri Suyash Agarwal, learned counsel for the respondent assessee.
Present appeal has been filed against the order No. A/70730-70734/ 2017-EX (DB) dated 24.7.2017 passed by the Customs, Excise and Service Tax Appellate Tribunal, Regional Bench, Allahabad in which the following questions of law have been framed:
(1)Whether on the facts and in the circumstance of the case the Tribunal has erred in law to hold that the clandestine manufacture and removal of final product is n
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Agency, Kanpur or documents recovered from the business premises of M/s K.P. Pan Flavours, Kanpur or from the business premises of M/s Ashwini Tobacco Pvt. Ltd. On the basis of the aforesaid bilties and GRs it was concluded by the appellant- department that the Gutlka manufactured by the respondent assessee were transported to Etawah, Farrukhabad and Kayamganj through M/s Vinod Forwarding Agency and the same were cleared to the aforesaid destinations without payment of Central Excise duty.
On the basis of the alleged recovery of documents from the aforesaid parties a show cause notice/demand dated 13.6.2008 was issued to the respondent assessee by the Director General, DGCEI, DZU, New Delhi. It was also alleged that during the survey dated 30.5.2006 at the business premises of the respondent assessee a cash of Rs. 7,90,000/- was confiscated on the alleged ground that the said money related to be sale proceeds of clandestinely cleared Gutkha. It was further alleged that no proper docu
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Act) and equal amount of penalty under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Act. It has further directed for the appropriation of the amount of Rs. 50,00,000/- voluntarily deposited on 3.6.2006. Feeling aggrieved by the order of the Commissioner, Central Excise and Service Tax, Kanpur the respondent assessee preferred an appeal before the Customs, Excise and Service Tax Appellate Tribunal, Regional Bench, Allahabad. The Tribunal vide the impugned order dated 24.7.2017 has allowed the appeal and set aside the demand of interest and penalty.
Against the impugned order present appeal has been preferred by the appellant- Revenue.
We have perused the record. It shows that the entire show cause notice has been based on bilties/GRs claimed to have been recovered from M/s Vinod Forwarding Agency, Kanpur. It further reveals that the goods transported by M/s Vinod Forwarding Agency, name of the manufacturer, have not been stated on the alleged GRs and its br
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of manufacturers of Gutkha without connecting the GRs with the goods manufactured by the particular assessee on the basis of particulars of goods stated in the GRs. It was also noticed by the Tribunal in the impugned order that there was no investigation conducted about procurement of raw material of allegedly clandestinely cleared goods.
The Tribunal has also come to the conclusion that there is no question of clandestine removal of goods without payment of duty. Moreover the bilties/GRs which were recovered from the transporter, M/s Vinod Forwarding Agency and were lying with the Revenue were being used for issuing show cause notice without conducting any investigation.
In view of the aforesaid finding of facts recorded by the Tribunal we do not find any infirmity in the impugned order.
The present appeal lacks merit and is hereby dismissed. The questions of law are answered accordingly in favour of the respondent assessee and against the Department.
Case laws, Decisions, Judg
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M/s. Pearl Drinks Ltd. Versus CGST, C.C. & C.E., Delhi-II
Central Excise
2019 (2) TMI 437 – CESTAT NEW DELHI – TMI
CESTAT NEW DELHI – AT
Dated:- 5-2-2019
E/52220/2018-EX [SM] – Final ORDER NO. 50187/2019
Central Excise
MRS. RACHNA GUPTA, MEMBER (JUDICIAL)
Present for the Appellant : Ms. Kiran Doiponode, Advocate
Present for the Respondent: Mr.P.R. Gupta, D.R.
ORDER
PER: RACHNA GUPTA
The Appellants herein M/s. Pearl Drinks Ltd., were engaged in the manufacture of aerated waters, beverages syrup and mango slices as well as in trading of goods i.e. trading of Aquafina. During the course of Audit conducted by Audit Group, Central Excise, Delhi-I on 18th, 19th, 21st, and 22nd February 2013 vide IAR No.1380/2013 for the period 2011-2012, it was observed that trading goods are exempted goods and they have not maintained separate accounts in respect of dutiable goods as well as exempted goods and therefore as per Rule 6(3) of CCR, 2004, the Appellants are required to
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3198/- on the Appellants.
2. Being aggrieved by the Order-In-Original dtd 28.12.2017 the Appellants filed the Appeal before the Ld. Commissioner Central Tax, Appeals-II , Delhi, holding that the Appellants are entitled to reverse the Cenvat Credit under Rule 6(3A) of the Cenvat Credit Rules, 2004 but remanded the case back to the Adjudicating Authority for ascertaining the quantum of reversible Cenvat Credit after examining the documentary evidence produced by the Appellants. He further held that after ascertaining the quantum of Cenvat Credit reversible by the Appellants, original Adjudicating Authority will decide the quantum of penalty.
3. Being aggrieved by the aforesaid Order-In-Appeal dtd. 28.03.2018 the Appellants prefer the present Appeal before this Tribunal.
4. I have heard both the parties. It is submitted on behalf of appellant that the Ld. Commissioner (Appeals) has erred in directing the original adjudicating authority to decide the quantum of penalty as if the Cenvat
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cenvat credit, the Appellants considered that the trading goods will be 10% and accordingly they have availed only 90% of service tax on common inputs services. sometimes, they have availed only 78% input service tax credit and sometimes 92% input credit was availed. During the year 2011-2012 the total service tax available as input credit was Rs. 1,19,63,278/- but the Appellants have availed only Rs. 1,07,66,950/- and did not avail Rs. 11,96,328/-. This is apparent from the chart submitted in reply to the Show Cause Notice showing that input service tax credit pertains to transport, courier service, maintenance, repair, etc.
7. I also observe that “Service” as defined under 65B (44) of the Finance Act, 1994 excludes (ii) such transfer, delivery or supply of any goods which is deemed to be a sale within the meaning of clause (29A) of article 366 of the Constitution which was inserted vide passing of Constitution [Forty Sixth] Amendment Act, 1982.
8. Going by its Statement of Objects
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ation appended to clause 2(e) of the Cenvat Credit Rules 2004 are mere clarificatory in nature, as definition of service as contained in 65B(44) and exempted service in 66D are to be read conjointly and not in exclusion of each other. This being the statutory definition, sale of goods; be it made in the high sea or within the territorial boundary of India in which Finance Act, 1994 has its force, cannot be called a service to impose tax liability or deny the credit under Rule 6 of Cenvat Credit Rules. Hon‟ble High Court at Madras in the case of Ruchika Global Interlinks vs. CESTAT, Chennai reported in 2017 (5) GSTL 225 (Mad.) has held as follows:-
“Both before and after amendment, “exempted services” meant those taxable services, which were exempt from whole of Service Tax and, included those services on which Service Tax was not leviable, under Section 66 of Finance Act, 1994. Inclusion in Explanation to Rule 2(e) of Cenvat Credit Rules, 2004 “trading” was only clarificat
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M/s S.A. Products, Lucknow Thru. Prop. Sandeep Arora Versus State of U.P. Thru. Prin. Secy., Deptt. of Commercial Tax And Ors.
GST
2019 (2) TMI 330 – ALLAHABAD HIGH COURT – TMI
ALLAHABAD HIGH COURT – HC
Dated:- 5-2-2019
Misc. Bench No. – 3349 of 2019
GST
Shabihul Hasnain And Alok Mathur JJ.
For the Petitioner : Mohammad Babar Khan,Anoop Kumar Vajpayee
For the Respondent : C.S.C.
ORDER
Heard Sri Mohammad Babar Khan, learned counsel for the petitioner as well as learned Standing counsel.
Petitioner has submitted that he had already paid the tax at the time of sale of goods specifically mentioned in the sales invoice e-way bill duly generated, hence, the petitioner has not contravened the provisions of CGST and SGST
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HUSKY INJECTION MOLDING SYSTEMS (INDIA) PRIVATE LIMITED Versus THE COMMISSIONER OF STATE TAX KERALA GST TAX TOWER, THIRUVANANTHAPURAM, ASST. COMMISSIONER (INT) PALAKKAD, KERALA GST DEPARTMENT PALAKKAD, DEPUTY COMMISSIONER OF STATE TAX, PALAKKAD AND ASST. STATE TAX OFFICER SQUAD NO. 1 KERALA GST DEPARTMENT PALAKKAD
GST
2019 (2) TMI 329 – KERALA HIGH COURT – 2019 (22) G. S. T. L. 323 (Ker.)
KERALA HIGH COURT – HC
Dated:- 5-2-2019
WA. No. 210 of 2019
GST
MR K. VINOD CHANDRAN AND MR ASHOK MENON, JJ.
For The Appellant : ADVS. SRI. RAJESH NAIR AND SRI. JOSEPH PRABAKAR
For The Respondents : SR GP SRI V. K. SHAMSUDHEEN
JUDGMENT
Vinod Chandran, J
Sri.Joseph Prabhakar, who appears for the appellant, would submit that the
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isions of Section 130. We are afraid that the time for raising such a contention has not arisen, since as of now the Department has not proceeded under Section 130. We gave Sri.Joseph Prabhakar the choice to withdraw the Writ Petition and challenge the Section 130 proceedings, when it is taken up or to furnish Bank Guarantee. The learned Counsel would then submit that; let there be an interim order granting release of the goods on furnishing of Bank Guarantee and the larger issue could be considered in the Writ Appeal or the Writ Petition itself. However, we are afraid, such course would not be commendable especially when a Bank Guarantee is given, eventually on final orders being passed either the Bank Guarantee would be released or enforc
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IGST Export Refunds–resolution of errors
PUBLIC NOTICE NO. 11/2019 Dated:- 5-2-2019 Trade Notice
Customs
OFFICE OF THE COMMISSIONER OF CUSTOMS (NS-II),
MUMBAI ZONE-II, JAWAHARLAL NEHRU CUSTOM HOUSE, NHAVA SHEVA, TALUKA: URAN, DISTRICT: RAIGAD, MAHARASHTRA-400707.
F. No. S/12-Gen-misc -07/2018-19/ AM (X)
Date: 05.02.2019
PUBLIC NOTICE NO. 11/2019
Subject: IGST Export Refunds-resolution of errors- reg.
Attention of all exporters, customs brokers, and all other stake holders is invited to the Board Circular No. 01/2019-Customs, dated 02.01.2019, on the subject mentioned above.
The processing of IGST refund claims on exports is fully automated. Majority of refunds claims are getting processed and sanctioned within five days of filing of GSTR-1 and GSTR-3B returns. However, in a few cases, particularly for the LCL cargo consignments originating from ICDs, Export General Manifest (EGM) related errors continue to hinder smooth and automatic sanction of IGST refund claims.
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with the local EGMs. Therefore, it was instructed that all the custodians / carriers / shipping lines operating at ICDs / gateway ports should file EGM online. It is reiterated that the first step would be that the concerned stakeholders at the originating ICDs file the local EGMs online.
(ii) Where the export goods are directly moved by truck to the gateway port, in such cases, filing the local EGM timely should not pose any problem. At inland ICDs/CFSs connected by train, the local EGM should be filed before the goods actually move out of ICD/CFS. In ICDs / CFSs not connected by train but where the movement of export goods begins from the nearest train-based ICD/CFS, it has been observed that local EGMs are not being filed as the train number is not known to the custodian for the want of rail receipt. In such cases, it must be ensured that local EGM is filed by the custodian immediately after getting train details in which containers are moving to gateway port, but in any case, be
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en re-stuffed. It was also mandated that the concerned shipping line would issue the bill of lading, a copy of which would be handed over to the custodian. After necessary endorsements regarding inspection, the transference copy would be returned to the originating ICD/CFS. Thus, the custodian of the CFSs or gateway port bears the responsibility to maintain all records with regard to LCL cargo consolidated at their premises. Subsequently, vide Circular No. 08/2018- Customs, instead of the said transference copy, correlation with final bill of lading or written confirmation from the custodian of the gateway CFS was permitted for purposes of integration of the local and gateway EGM.
(ii) In some field formations a tally sheet is being maintained in the form of Container Load Plan (CLP) which is prepared by shipping lines and gives details of packages stuffed in the container. Cargo is destuffed under customs supervision based on Container De-stuffing Plan (CDP). Preparing CLP/CDP does
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ts or CDP/CLP (containing container details) relating to the said SBs to the customs officers.
(iv) For those shipping bills in respect of which no gateway EGM was filed in the first place, the shipping line can file supplementary EGM for successful integration.
(v) Responsibilities and liabilities of custodians have been provided in detail in the Handling of Cargo in Customs Areas Regulations, 2009. Regulation 6 clearly casts the responsibility of keeping account of export goods on the Customs Cargo Service Provider (CCSP). Further, the procedure for suspension or revocation and imposition of penalty is provided in Regulation 12 which liable to be resorted to in cases where CCSP fails to comply with the regulations. This would be strictly enforced after following due process in instances of persistent non-compliance. (viii) Export of goods out of India is an essential condition for grant of IGST refund as provided in Rule 96 of CGST Rules, 2017. It therefore warrants verification
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