Goods and Services Tax

In Re: M/s. Xiaomi Technology India Private Limited
GST
2019 (2) TMI 66 – AUTHORITY FOR ADVANCE RULINGS, KARNATAKA – 2019 (21) G. S. T. L. 333 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULINGS, KARNATAKA – AAR
Dated:- 22-1-2019
AAR KAR ADRG 01/2019
GST
SRI. HARISH DHARNIA, AND DR. RAVI PRASAD M.P. MEMBER
Represented by: Sri Shivarejan K, Charted Accountant
ORDER UNDER SUB-SECTION (4) OF SECTION 98 OF CENTRAL GOODS AND SERVICE TAX ACT, 2017 AND UNDER SUB-SECTION (4) OF SECTION 98 OF KARNATAKA GOODS AND SERVICES Tax ACT, 2017
1. M/s. Xiaomi Technology India Private Limited, Orchid – Block E, Embassy Tech Village/ Devarabisanahahalli, Marathaili Outer Ring Road, Bangalore – 560 103 having GSTIN number 29AARCS5667D1ZQ, have filed an application for Advance Ruling under Section 97 of CGST Act,2017,KGST Act, 2017 & IGST Act, 2017 read with Rule 104 of CGST Rules 2017 & KGST Rules 2017, in form GST ARA-01 discharging the fee of Rs. 5,000-00 each under the CGST Act and t

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attery charger i.e. adaptor, to store the electrical energy. The second component is the circuitry which is equipped with an Integrated Chipset, consists of a charge management system and a voltage boost converter. The Charge Management System detects the type of charger being used to charge the Mi Power Bank and adjusts the charging current accordingly. The Voltage Booster Converter is a DC-to-DC power converter that steps up voltage from its input supply to its output i.e. load. It is a class of switched-mode power supply (SMPS) containing at least two semiconductors (a diode and a transistor) and at least one emery' storage element i.e. a Capacitor, inductor or the two in combination. Filters made Capacitors (sometimes combination with inductors) are added to the output and input to reduce voltage ripples. The said converter detects the device being charged by the Mi Power Bank and adjusts the current to ensure the optimum level of current & voltage output, as per the load demand. T

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5.2018, before this authority and submitted that they have been classifying their product 'Power Bank' right from the pre-GST regime under the entry 8504 40 90 as 'Static Coverters – Others' with respect to imports as well as domestic procurement; the most relevant chapter for determining the HSN of Power Bank under Customs Tariff Act 1975 shall be chapter 85 and the tariff entries relevant to the classification in the instant ease are '8504 40 90' in respect of static converters that are taxable at 18% of GST and '8507 60 00' in respect of electrical accumulators that are taxable at 28% of GST.
7. The Applicant further submitted that the terms used in the tariff are technical or scientific in nature and it sis a well settled principle of interpretation that where a word is used in tariff entry in a technical or scientific sense, then it must be construed according to its technical or scientific meaning. The applicant, based on the explanatory notes to the Harmonised Commodity Descrip

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4 to the Section XVI of Customs Tariff Act 1975, the Power Bank has 2 or more components (i.e. static converters and batteries), has a clear defined function of charging a device and accordingly Power Bank is classifiable under tariff entry 8504 40 90 as 'Static Converter – Others'. The applicant, in support of their argument, submitted copy of Technical Research Report, issued by the Indian Institute of Technology (Banaras Hindu University), Varanasi wherein it is reported that Tower Bank can be considered as static converter and not only a charge accumulator”.
7.2 The applicant, without prejudice to the above argument, put forth another argument, submitting that the Power Bank essentially performs dual function i.e. accumulation of energy & conversion of energy from DC to DC providing regulated output current; the principal function of the Power Bank is to ensure the charging of device; mere lithium-ion battery would not suffice to charge a device unless the battery is supported by

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f Luminous Electronics Pvt. Ltd., [2001 (129) ELT 605] = 2001 (3) TMI 131 – CEGAT, NEW DELHI wherein it is held that the UPSS is classifiable as Static Converter under tariff heading 8504. They also refer to the Circular No. 104/2003-Cus. Dated 9-12-2003, issued by the then CBEC„ New Delhi wherein the UPSS was classified under tariff heading 8504 of Customs Tariff Act 1975 as well as The C,Ex., Tariff Act 1985. The Static Converter (UPSS) also is classified under 8504 in the GST regime and the explanatory notes to the Harmonised Commodity Description and Coding System to heading 85.04 supports the said Classification of the UPSS.
7.4 In View of the above, the applicant prays to clarify the classification of the Power Bank under tariff heading 8504, in the light of their analysis / arguments supra, technical report of IIT, Varanasi and judicial precedence on UPSS.
FINDINGS & DISCUSSION:
8. We have considered the submissions made by the Applicant in their application for advance

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are employed which contribute to the function of the battery in the Power Bank. The ancillary circuitries are (i) Charge Management System, which is used to detect the type of charger being connected to charge the battery in Power Bank and to adjust the current accordingly and (ii) Voltage Booster System, which is used to detect the device Connected to the Power Bank and to obtain output as per the load demand. Both the circuits are essentially enhancing the function of the main part i.e. Battery. Therefore the principal function of the said product is to store the electricity and supply the same i.e to charge the devices, connected to it.
8.3 Therefore it is clear from above that the principal function of the instant product is to store the electricity in the battery of the said product and to supply the same when required. Hence it is pertinent to mention here that the battery in the Power Bank is the main / core part of the device and without the battery the Power Bank would not fu

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of the above, the principal function of Power Bank is only to charge, even though the additional circuitry is embedded in it for drawing required rated current depends on the load.
8.5 The reasons for categorizing UPSS as a Static Converter falling under Chapter Heading 8504 have been discussed in detail in the cited case of M/s. Luminous Electronics Pvt. Ltd,. Vs CCE, New Delhi. 2001 (3) TMI 131 – CEGAT, NEW DELHI. The Applicant concludes with the argument that as the functions and components of UPSS are similar to that of Power Bank under examination, the Power Bank also merits classification under Chapter Head 8504 similar to that of UPSS. We proceed to examine the functions and components of UPSS vis-a-vis a Power Bank.
The principal function of a UPSS is to act as an uninterrupted source of electric power. The electric stored in the battery of the UPSS is converted into A-C. power, by the inverter in it, and supplied. However it is not essential to have a battery in the UPSS an

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tem to heading 85.07 states the following:
Electric accumulators remain classified here even if presented without their electrolyte.
Accumulators containing one or more cells and the circuitry to interconnect the cells amongst themselves, often referred to as “battery packs”, are covered by this headings whether or not. they include any ancillary components which contribute to the accumulator's function of storing and supplying energy, or protect it from damage, such as electrical connectors, temperature control devices, and protective housings. They are classified in this heading even if they are designed for use with a specific device.
It is clearly evident from the above explanatory note that accumulators are covered under heading 8507 whether or not they include any ancillary components which contribute to their function of storing and supplying electric energy. Further the. accumulators are classified under the heading 85.07 even if they are designed for use with a specific d

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Director General Anti-Profiteering, Central Board of Indirect Taxes & Customs Versus M/s. Satya Enterprises
GST
2019 (1) TMI 1419 – NATIONAL ANTI-PROFITEERING AUTHORITY – TMI
NATIONAL ANTI-PROFITEERING AUTHORITY – NAPA
Dated:- 22-1-2019
03/2019
GST
SH. B.N. SHARMA, CHAIRMAN, SH. J.C. CHAUHAN, TECHNICAL MEMBER, MS. R. BHAGYADEVI, TECHNICAL MEMBER, MR. AMAND SHAH, TECHNICAL MEMBER
Ms. Gayatri Verma, Deputy Commissioner for the Applicant.
Mr Rajender Kumar Sharma Accountant, Mr. Bhagwan Dass Verma Authorised Agent of the Owner and Mr. Dushant Kumar Dubey Tally Operator, for the Respondent.
ORDER
1. The brief facts of the present case are that a reference was made by this Authority to the Director General Anti-Profiteering (DGAP), erstwhile Director General Safeguards, under rule 128 of the Central Goods and Services Tax (CGST) Rules, 2017 intimating that certain major manufacturers of Fast Moving Consumer Goods (FMCG) have not passed on the benefit of reduction i

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ate whether he admitted that the benefit of reduction in the rate of tax had not been passed on to the recipients by way of commensurate reduction in prices and to also suo moto determine the quantum of benefit not passed on and mention the same in his reply. The Respondent was also provided opportunity by the DGAP to inspect the non-confidential record, however, he didn't avail of this opportunity.
5. The DGAP had sought extension of time to complete the investigation, which was granted upto 08.11.2018 by this Authority on 06.08.2018 in terms of Rule 129 (6) of the CGST Rules, 2017.
6. The DGAP has mentioned in his Report that the Respondent vide his reply dated 15.06.2018 had stated that he was getting commission on the purchases he made from the manufacturer and was also getting a discount of approx. 33% when the rate of tax was 28%, which was reduced to approx. 22% when the rate of tax had come down to 18%. He has also stated that the Respondent was charging a fixed commission of

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FMCGs from 28% to 18% w.e.f. 15.11.2017, including the 'Beauty Cream 50 GM' vide Notification No. 41/2017-CentraI Tax (Rate) dated 14.1 1.2017, which had been also admitted by the Respondent.
9. The DGAP has also stated that the issue of passing on the benefit of reduction in the rate of GST to the recipients of various goods sold by the Respondent had been examined by him after determining the base prices of the products, pre 15.11.2017 and post 15.11.2017.
10. The DGAP has further stated that from the invoices made available as detailed in the Table below it was clear that the Respondent had increased the base price of the 'Beauty Cream 50 GM' when the rate of tax was reduced from 28% to 18%, so as to keep the cum-tax selling price the same as it was prior to the rate reduction on 15.11.2017:-
Sr. No.
Invoice No. and date
Description of products
Discounted Base Price (in Rs.)
Rate of GST
Price charged (inclusive of GST) in Rs.
1
1429 12.11.2017
Beauty Cream 50 GM
48.60
2

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ucts supplied by the Respondent were increased after 15.11.2017. He has further alleged that during the period between 15.11.2017 to 31.05.2018, the Respondent had sold a total of 361 products comprising of 65 HSN codes, out of which 154 products constituting 24 HSN codes were affected by the reduction in the rate of tax from 28% to 18% w.e.f. 15.11.2017. The DGAP has also contended that out of the above 154 products, 48 products were not supplied during the period between 01.11.2017 to 14.11.2017 and they included 13 new products which were introduced for sale after 15.11.2017. He has further contended that for the remaining 35 products, the pre 15.11.2017 reference prices for calculating the profiteered amount were taken from the price list which was effective before 15.11.2017 and was submitted by the Respondent vide his email dated 30.09.2018 and these prices were found to be lower than the post 15.11.2017 base prices. The DGAP has also submitted that out of the remaining 106 (154-

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sued to all the interested parties. The Applicant was represented by Ms. Gayatri Verma, Deputy Commissioner and the Respondent was represented by Mr. Rajender Kumar Sharma Accountant, Mr. Bhagwan Dass Verma Authorised Agent of the owner and Mr. Dushant Kumar Dubey Tally Operator.
14. During the hearing of the case the Respondent did not file written submissions but stated that he had no control over the Maximum Retail Prices (MRPs) as the same were fixed by the manufacture viz. M/s. Patanjali Ayurveda Ltd. and he was bound to charge the same as per the instructions of the manufacturer. He has also stated that he was charging margin of 5% on the sales made by him which he had not increased after the rate of tax was reduced and hence he had not profiteered. He has further stated that he was not aware whether basic prices had been increased by M/S Patanjali Ayurveda Ltd. after the reduction in the GST rate or during the regular course of business.
15. We have carefully considered the ma

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. Therefore, it is established that the Respondent had denied benefit of reduction in the rate of tax to his customers by increasing the base price exactly by the amount by which the tax was reduced and therefore, he had resorted to profiterring in violation of the provisions of Section 171 of the CGST Act, 2017. The Respondent had further compelled the recipients to pay additional GST on the increased price @ 18% and had he not increased the base price and charged additional GST his customers would have got benefit of further reduction in the MRP. Therefore, the additional amount of tax collected also amounts to profiteering made by the Respondent.
16. It is also revealed from the perusal of Annexure-Il prepared by the DGAP after examining the details of the outward taxable supplies of all the products supplied by the Respondent that the base prices of most of the products sold by him were increased after the tax was reduced from 28% to 18% w.e.f. 15.11.2017. It is also clear from th

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ate of tax, the base prices of 109 (74+35) items were increased w.e.f. 15.11.2017; in respect of 32 products, the base prices were reduced after 15.11.2017; whereas 13 products were newly introduced after 15.11.2017. Therefore, it is quite clear that the Respondent had not passed on the benefit of tax reduction in respect of the 109 products supplied by him during the period between 15.11.2017 to 31.05.2018 and hence, it is established beyond doubt that the Respondent had resorted to profiteering of Rs. 6,06,752.72/-, as has been elaborated in Annexure-Il of the DGAP's Report. The Respondent has not raised any objection against the calculation of the profiteered amount by the DGAP and hence this Authority determines the above amount as the profiteered amount. It has also been found that all the supplies were made by the Respondent in the NCT of Delhi.
17. The only argument advanced by the Respondent is that the MRPs were fixed by the manufacturer viz. M/s. Patanjali Ayurveda Ltd. whic

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ad no control on the fixing of the MPRs.
18. The Respondent has also claimed that he had only charged commission @ 5% on the sales made by him which he was charging before and after coming in to force of the GST and hence he had not profiteered. However, it is clear from the narration of the facts mentioned above that the Respondent had increased the base prices of 109 products which were being supplied by him after the rate of GST was reduced w.e.f. 15.11.2017 and forced his customers to pay more prices than what they should have paid and thus he had denied the benefit of rate reduction to them. He had also compelled them to pay additional GST on the increased quantum of base price otherwise this would also have further resulted in passing on the benefit of rate reduction to them. Mere charging of the fixed commission does not amount passing on the above benefit and hence the above plea of the Respondent is frivolous and can not be accepted.
19. Accordingly, the Respondent is direct

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established against him. It is clear from the facts of the present case that the Respondent was fully aware of the provisions of Section 171 of the COST Act, 2017 as well as the Notification dated 14.11.2017 whereby he was bound to pass on the benefit arising due to reduction in the rate of tax to his customers. However, the Respondent has deliberately acted in defiance of the above law and hence he is guilty of the conduct which is contumacious and violative of the provisions of the above Section. He has further acted in conscious disregard of the obligation which was imposed upon him by the law, by issuing incorrect invoices in which the base prices were deliberately increased by the amount by which the rate of tax was reduced and thus he had denied the benefit of reduction in the prices to his customers. He has further forced them to pay additional GST on the increased base prices which they were legally not required to pay, by issuing incorrect tax invoices. Accordingly, he has co

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M/s H.M. INDUSTRIAL PVT. LTD Versus THE COMMISSIONER, CGST AND CENTRAL EXCISE
GST
2019 (1) TMI 1287 – GUJARAT HIGH COURT – 2019 (22) G. S. T. L. 187 (Guj.)
GUJARAT HIGH COURT – HC
Dated:- 22-1-2019
R/SPECIAL CIVIL APPLICATION NO. 1160 of 2019
GST
MS HARSHA DEVANI AND DR A. P. THAKER, JJ.
For The PETITIONER (s) : ANANDODAYA S MISHRA (8038)
ORAL ORDER
(PER : HONOURABLE MS.JUSTICE HARSHA DEVANI)
1. Heard Mr. A. S. Mishra, learned advocate for the petitioner.
2. From the facts as emerging from the record, it appears that provisional attachment of the bank accounts of the petitioner has been made under section 83 of the Central Goods and Services Tax Act, 2017, however, no copy of any order under section 83 of the sa

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Adesh Jain Versus The Commissioner or Central Tax GST Delhi (West).
GST
2019 (1) TMI 1286 – PATIALA HOUSE COURT – TMI
PATIALA HOUSE COURT – DSC
Dated:- 22-1-2019
Bail Application No. 261/19
GST
SHRI NARESH KR. MALHOTRA ASJ/SPECIAL JUDGE, CBI.02,
PATIALA HOUSE COURTS,
Present-
Sh. Harpreet Singh, Lad. Sr. Standing Counsel GST Department along with Sh. Amar Singh, Inspector, GST and IO/Insp. Sahil Yadav.
Sh. Rajesh Jain, Ld. counsel for applicant.
Pr. None.
It is contended by Id. Counsel for applicant that applicant was detained by the officials of Central Tax/CGST (Delhi-West) on 31.7.2018 and produced before Id. on 1.8.2018 along with co accused Rajesh Jindal. Bail was granted to the co accused and applicant

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Hon'ble High Court vide order dated 28.12.2018 dismissed the bail application. It is also mentioned that applicant is not registered person under the provisions of the Act and has not issued any invoice for the purpose of wrongful availment or utilization of input tax credit. Applicant is 43 years old and suffering from various ailments like acute blood pressure, diabetes and heart ailment. It is prayed that applicant be enlarged on bail.
On the other hand, Id. Standing counsel for respondent contend that there are serious allegations against the applicant. His co accused was granted bail by the court of Ld. MM. Respondent has filed an application before Id. CMM for cancellation of bail but this application was dismissed on 14.8.2018.

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companies without actual supply of goods. This was done with malafide intent to pass on the undue advantage of ITC to various companies/firms for utilizing the bogus GST, ITC so generated and in return accused and the co accused were taking commission at various rates. The activity of accused and of co accused was found involving fictitious sales of the value of Rs. 201 Crores and of the amount Of tax evasion of more than Rs. 27 Crores.
Today department has filed detail of tax liability which shows that total transaction amount in the present case is 251.55 Crores and 42.09 as GST was passed on the buyers.
In the present case, there are serious allegations against the applicant. Vide detailed order dated 22.12.2018, the application for ca

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Rajesh Jindal Versus Commissioner or Central Tax GST Delhi (West)
GST
2019 (1) TMI 1285 – PATIALA HOUSE COURT – TMI
PATIALA HOUSE COURT – DSC
Dated:- 22-1-2019
Remand Paper NO. 882
GST
SHRI NARESH KUMAR MALHOTRA ASJ/ SPECIAL JUDGE, CBI-02,
Present:-
Sh. Harpreet Singh, Ld Sr. Standing Counsel GST Department along with Sh. Amar Singh. Inspector, GST and IO/Insp. Sahil Yadav.
Sh. Aditya Kumar, Ld. counsel for applicant.
Pr. none
It is contended by Id. Counsel for applicant that recovery has already been effected and respondent has recovered all the material from the office and residence of the applicant. It is also mentioned that documents pertaining to business and official transaction of applicant are already i

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ted in the investigation. The statement of Witness relied upon by the department ie Deepak Taneja is not reliable. It is prayed that applicant be enlarged on bail.
On the other hand, Ld. Sr. Standing counsel contents that there are serious allegations against the applicant. Applicant was granted bail by the court of Ld. MM. Respondent has filed an application before Id. CMM for cancellation of bail but this application was dismissed on 14.8.2018. Respondent has approached the Sessions Court for cancellation of bail of the applicant and vide order dated 22.12.2018, the application filed by the respondent is allowed and bail of the respondent is cancelled. It is also contended by Id. Sr.Standing Counsel that applicant had approached the Hon'

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n return accused and the co accused were taking commission at various rates. The activity of accused and of co accused was found involving fictitious sales of the value of Rs. 201 Crores and of the amount of tax evasion of more than Rs. 27 Crores.
Today department has filed detail of tax liability which shows that total transaction amount in the present case is 251.55 Crores and 42.09 as GST was passed on the buyers.
In the present case, there are serious allegations against the applicant. Vide detailed order dated 22.12.2018, the application for cancellation of bail of applicant was allowed by Sh. Satish Arora, Id. ASJ, New Delhi and this order was affirmed by the Hon'ble High Court. No ground for bail is made out. Bail application is di

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GST Registration – Bank Account Requirment
Query (Issue) Started By: – Felipe Luciano Dated:- 21-1-2019 Last Reply Date:- 26-1-2019 Goods and Services Tax – GST
Got 7 Replies
GST
Dears,
Is possible do the GST Registration if I do not have a bank account?
Or use the bank account of third party as my bank account for GST Purposes.
Reply By KASTURI SETHI:
The Reply:
Registration under GST is not mandatory to open bank account. You cannot use third party registration for this purpose. Otherwise also it is not required .
Reply By Felipe Luciano:
The Reply:
I need obtain GST registration, but I do not have local bank account because, my company is on foreign.
Reply By Hiren Pathak:
The Reply:
Requirement of bank account detai

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Rate of GST on elevators
Query (Issue) Started By: – Navin Agarwal Dated:- 21-1-2019 Last Reply Date:- 17-10-2019 Goods and Services Tax – GST
Got 4 Replies
GST
Please let me know about any circular no or notification no which speaks about rate of GST on elevator. Also indicate any changes in rate of GST on elevators for personal use.
Your guidance will be appreciated.
Thanking you in anticipation.
Reply By KASTURI SETHI:
The Reply:
Supply of Elevator (as goods) falls under Chapter/Heading 8428 of GST Tariff -Goods and attract GST @ 18% (9% + 9%).
Supply of services of Elevator (Maintenance, Repair & installation is covered under HSN 998718 GST Rate 18% (9% +9%). Notification No.11/17-CT(Rate) dated 28.6.17 as amended . (S

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Resale of Imported goods and commodities
Query (Issue) Started By: – Nitin Ambhaikar Dated:- 21-1-2019 Last Reply Date:- 23-1-2019 Goods and Services Tax – GST
Got 1 Reply
GST
1. Importer is Registered in Chhattisgarh
2. Goods are imported at Vizag Port, Andhra Pradesh
3. Trader is in Mumbai, Maharashtra who is Buying goods from Importer who has registration in Chhattisgarh
4. Importer is selling goods from Vizag port with invoice raised at Chhattisgarh charging IGST in the invoice
5. Trader is further selling goods to Buyer in Karnataka with invoice raised at Mumbai, Maharashtra with charging IGST on the amount at which goods are sold and paying differential IGST amount.
6. Importer, Trader and Buyers have successfully fi

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Valuation of Motor Vehicles: Tax Collected at Source u/s 206C to be Clarified Post Writ Petition Resolution.
Case-Laws
GST
Valuation of supply – motor vehicle – inclusion of tax collected at

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GST Compensation Cess
Query (Issue) Started By: – Maulin Golwala Dated:- 21-1-2019 Last Reply Date:- 23-1-2019 Goods and Services Tax – GST
Got 2 Replies
GST
Is GST Compensation cess applicable on provision of motor vehicle to local authority (under tender system)?
Is Compensation cess applicable to rent-a-cab service providers like Ola & Uber?
Please provide reference to relevant notification / circular.
Reply By KASTURI SETHI:
The Reply:
Compensation Cess on specified service

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FAQs on TDS under GST dated 28-09-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
TDS in GST
Q. 1   As a DDO I am deducting TDS from salary and also while making payment of other bills under Income Tax Act. Then why should I need to deduct TDS again?  
Ans. TDS under Income Tax is different from TDS under GST. There was a provision of TDS under VAT Act also. TDS under the GST Law is different from the above. Deductions of tax under the GST Laws is required to be made wherever applicable while making payments to the suppliers/ vendors of goods or services or both under GST for taxable supply of goods or services or both.
Persons liable to deduct TDS under GST Laws
Q. 2   Who are liable to deduct TDS?  
Ans. All the DDOs of the (a) a department or establishment of the Central Government or State Government; (b) local authority; (c) Governmental agencies; (d) an authority or a board or any other body, -(i) set up

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suppliers)
Registration requirement for TDS deductors & Procedure of Registration
Q. 4   Does every Government office require to be registered under GST laws?  
Ans. Yes, every Government office shall get itself mandatorily registered under GST. Here the role of DDO is very important as he is responsible for deducting tax while making/crediting payment under GST in applicable cases and, unless & until the process of registration is completed, the DDO will not be able to deduct any tax
Q. 5   I am a DDO of a small Government Office. My office has not entered into any contract with any vendor whose taxable value of supply is more than ₹ 2.5 Lakh in the recent past. Do I have to take GST registration for my office?  
Ans. No. You are liable to register only when you make a payment on which tax is required to be deducted
Q. 6   Do I have to pay any Fees for obtaining a GST registration?  
Ans. No fee is required t

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ion do I always need a DSC?  
Ans. One can use Electronic Verification Code for submission of the registration form in the common portal apart from DSC.
Q. 11   How do I know that I have submitted the application form correctly? What is an ARN?  
Ans. A pop-up message will appear that the form has been successfully submitted & an Acknowledgement Reference Number (ARN) will be sent to the registered mobile no & registered email address of the applicant after successful submission of Registration Application (FORM GST REG-07) online.
Q. 12   Is this ARN called the GST registration No?  
Ans. No. This ARN is generated only for a temporary period. Once FORM GST REG-07 is processed by the proper officer, the 15-digit GSTIN of the Tax Deductor will be generated. This GSTIN is the GST Registration No. of the applicant office.
Q. 13   How do I know that GSTIN has been generated for my office or not?  
Ans. Informa

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se done by this new DDO?  
Ans. No, the ex-DDO will not be liable for any lapse by his successor in office. A DDO is required to perform any responsibility in respect of TDS in GST either through a valid DSC (which is person specific) or through an EVC which would be sent to the registered mobile no as well as registered email id of the DDO only
Situations when tax is required to be deducted in GST
Q. 17   Is there any threshold exceeding which tax is required to be deducted?  
Ans. Yes. Tax is required to be deducted from the payment made/credited to a supplier, if the value of supply under a contract in respect of supply of taxable goods or services or both, exceeds ₹ 2,50,000/- (Rupees two lakh and fifty thousand). This value shall exclude the taxes leviable under GST (i.e. 'Central tax', 'State tax', 'UT tax', 'Integrated tax' & 'Cess')
Q. 18   Mr B, a DDO of ABC Office of the Government West Bengal needs to buy stationeries for

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77; 1.5 Lakh in respect of an invoice dated 25.10.2018 submitted by the supplier. Should I deduct tax while making payment of ₹ 1.5 Lakh?  
Ans. Yes. Tax is required to be deducted since the payment is being made after the effective date
Q. 22   I have entered into a contract worth ₹ 10 Lakh with a supplier XYZ prior to 01.10.2018. I have made a payment of ₹ 3 Lakhs to him prior to 01.10.2018. Now, I am making payment of the balance amount of ₹ 7 Lakh after 01.10.2018. Should I deduct tax on ₹ 10 Lakh?  
Ans. No. Tax cannot be deducted for any payment made prior to 01.10.2018. So deduction will be made only in respect of ₹ 7 Lakh
Q. 23   I enter into a contract with a supplier ABC where the value of taxable supply is ₹ 2 Lakh and payment of ₹ 1 Lakh has been made on 15.10.2018. Now, on 20.10.2018 the contract value is revised from ₹ 2 Lakh to ₹ 6 Lakh. Am I liable to deduct any tax

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* all services which are exempted as per principal notification No.12/2017 – Central Tax (Rate) as amended from time to time;
* all goods which are exempted as per principal notification No.2/2017 – Central Tax (Rate) as amended from time to time;
* When the goods and services are supplied prior to 30.09.2018 and payments are being made after 01.10.2018.
Valuation for deduction of tax with illustrations
Q. 26   Mr Z, a supplier in West Bengal has issued a Tax Invoice of ₹ 11,800/- for supply of goods/services or both worth ₹ 10,000/- and GST of ₹ 1,800/- to Mr A of ABC office in West Bengal. What is the value of payment on which Mr A should deduct TDS during making payment to Mr Z? Calculate the amount payable to Mr Z.  
Ans. For purpose of deducting of TDS, the value of supply is to be taken as the amount excluding the tax indicated on the invoice. This means TDS shall not be deducted on the CGST, SGST or IGST component of invoice. In this

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t IGST @2%.
Q. 29   Health Department of WB receives a taxable service from MNO company of WB. What would be the nature of TDS to be deducted here & what would be the rate of deduction?  
Ans. The DDO of the Health Department is liable to deduct TDS (1% CGST+1% SGST) while making payment to MNO Company as in this case the supplier or the vendor & the DDOs office (the place of supply) both are in West Bengal.
TDS Payment
Q. 30   How can I discharge my TDS liability?  
Ans. TDS liability can be discharged by debiting of Electronic Cash Ledger only at the time of filing return in FORM GSTR 7.
Q. 31   Payment is made in respect of a single contract whose value of taxable supply is ₹ 3.5 Lakh. Two bills amounting to ₹ 1.5 lakh & ₹ 2 lakh respectively are passed for such payment. Since in respect of both the bills the amount paid does not exceed ₹ 2.5 lakh, I think that no tax is required to be deducted. Am I r

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t so deducted will be auto-populated in 'TDS/TCS credit receipt' table of respective suppliers. The supplier (deductee) has to accept or reject the amount so auto-populated in the table after logging on the portal. The accepted amount will be credited to Electronic cash ledger while rejected amount will be auto-populated in Amendment table of next month's FORM GSTR-7 of the deductor.
Q. 34   What will happen if the TDS credit entry is rejected by the deductee?  
Ans. The rejected transactions in 'TDS/TCS credit receipt' table will be communicated back to the deductor who will download the auto-populated transactions and make necessary amendments in GSTIN or amount etc. in table 4 of FORM GSTR-7. The amended details will again be auto-populated in 'TDS/TCS credit receipt” table. Supplier will take action comprising Accept/Reject the transactions. As usual, amount of accepted invoices will be credited to electronic cash ledger of the supplier.
Q. 35   Is

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of the electronic cash Ledger and that can be done only while submitting FORM GSTR 7. So, unless the return in FORM GSTR 7 is submitted the payment liability of the DDO will not be treated as discharged.
Q. 38   Mr S has deducted GST amounting to ₹ 50,000/- in the month of Nov'18. He filed return on 16.12.2018. Is he liable to pay a late fee?  
Ans. Yes he is liable to pay a late of ₹ 600/- at the rate of ₹ 100/- per day for delay of 6 days (11.12.2018 – 16.12.2018). Maximum amount of late fee payable is capped at ₹ 5,000/- Similar late fees is applicable under SGST Act / UTGST Act.
Q. 39   During October, 2018, I have not deducted any amount of GST. Do I need to file return for the month of October?  
Ans. The Deductor i.e. DDO is required to furnish a return in FORM GSTR-7 electronically for the month in which such deductions have been made in accordance with the provision of section 39(3) of the CGST/ SGST Acts,

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/ non-revoked digital signature (DSC) in case return is to be filed through DSC.
* Tax Deductor has made payment or credited the amount to the supplier's account
Q. 44   What are the modes of signing FORM GSTR-7?  
Ans. FORM GSTR-7 can be filed using DSC or EVC.
Q. 45   Can I preview the FORM GSTR-7 before filing?  
Ans. Yes, the preview of FORM GSTR-7 can be seen by clicking on 'Preview Draft GSTR-7' before filing on the GST Portal.
Q. 46   What happens after FORM GSTR-7 is filed?  
Ans. After FORM GSTR-7 is filed:
* ARN is generated on successful filing of the return in FORM GSTR-7.
* An SMS and an email are sent to the applicant on his registered mobile and email id.
Q. 47   Can I file the complete FORM GSTR-7 using Offline Utility?  
Ans. No. Filing can take place only online on the GST Portal. The details of Table 3 and Table 4 can be prepared offline but remaining activities like pay

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wnloaded Zip file which contain GSTR7_Offline_Utility.xls excel sheet.
4. Open the GSTR7_Offline_Utility.xls excel sheet by double clicking on it.
5. Read the 'Read Me' instructions on excel sheet and then fill the worksheet accordingly.
Q. 50   Do I need to login to GST Portal to download the FORM GSTR-7 Offline Utility?  
Ans. No. One can download the FORM GSTR-7 Offline Utility under 'Download' section without logging in to the GST Portal.
Q. 51   Do I need to login to GST Portal to upload the generated JSON file using FORM GSTR-7 Offline Utility?
Ans.    Yes. You must login in to the GST Portal to upload the generated JSON file using FORM GSTR- 7 Offline Utility
Q. 52   What are the basic system requirements/ configurations required to use FORM GSTR-7 Offline Tool?
Ans.    The offline functions work best on Windows 7 and above and MS EXCEL 2007 and above.
Q. 53   Is Offline utility mobile co

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the incorrect data has to be deleted in the utility manually using the “Delete” button of the keyboard. Add and Delete options of the “Action” column are meant for adding or deleting data in the GST portal. Delete option is required to be ignored while preparing FORM GSTR-7 for first- time upload, and for the subsequent uploads it can be used only to delete those particular rows from the already-uploaded data on the portal.
Q. 57   Can I enter negative or decimal amounts in the offline utility?  
Ans. No, any negative value cannot be entered in the utility. However, decimal values can be entered. All decimal values would be rounded off to two decimal places. But, total liability will be rounded off to whole number.
Q. 58   I've uploaded GSTR-7 JSON File and it was processed without error. Do I need to download the generated file?  
Ans. No, it is not necessary to download the GSTR-7 JSON File processed without error. One can download it onl

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in FORM GSTR 7 for the month of November, 2018 is filed on 28.02.2019 and he discharges his payment liability of tax so deducted by debiting his electronic cash ledger as well on this date only, therefore, late fee of 80 days (11.12.2018 to 28.02.2019) have to be paid under CGST and SGST. The amount of late fee will be restricted to ₹ 5000/- (upper limit provided in the Act). Interest has also to be paid for the delay. Penalty is also payable by a DDO if he fails to deduct the tax in accordance with the provisions of sub-section (1) of section 51, or deducts an amount which is less than the amount required to be deducted under the said sub-section, or where he fails to pay to the Government under sub-section (2) of section 51 [section 122(v) refers]. He is liable to penalty of ₹ 1,00,000/-.
TDS Certificate &Benefit of TDS to the deductee
Q. 61   As a DDO I have deducted tax while making payment to various Vendors. I have deposited the amount in the appropriate G

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ate; signature of Tax Deductor is not required
65   Do I as a taxpayer have to file FORM GSTR-7A?  
Ans. No, a tax payer (deductee) is not required to file FORM GSTR-7A
Q. 66   Can I as a taxpayer (Deductor or Deductee) download and keep a copy of my TDS Certificate for future reference?  
Ans. Yes, TDS Certificate can be viewed and/or downloaded in post-login mode on the GST portal.
Q. 67   Being a deductor do I have to fill any form to generate FORM GSTR 7A? How can I view Form GSTR-7A?  
Ans. No, a deductor is not required to fill up any separate form for generation of FORM GSTR 7A. FORM GSTR 7A shall be generated if return in FORM GSTR 7 is filed. To view Form GSTR-7A, perform following steps: 1. Access the www.gst.gov.in URL. The GST Home page is displayed. 2. Login to the GST Portal with valid credentials. 3. Click the Services → User Services → View/Download Certificates command.
Manuals, Ready rec

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Tile Adhesive and Grout Classified Under Entry 24, Schedule IV, Notification No. 1/2017, Subject to 28% GST Rate.
Case-Laws
GST
Classification of goods – rate of tax – Tile Adhesive – Tile Gr

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ITC on business promotion and Diwali Gift to Employees.
Query (Issue) Started By: – MODASSIR NAZAR Dated:- 21-1-2019 Last Reply Date:- 26-1-2019 Goods and Services Tax – GST
Got 7 Replies
GST
Dear All
One of My company doing camera rental Business.They give mobile and gift to cameraman and their assistants as a business promotions.can i take ITC of GST on the same.
Also we are gifting in diwali to our employees. Can we take GST ITC on the same. (diwali gift to Employees).
Reply By SHARAD ANADA:
The Reply:
Refer schedule I of CGST Act and Sec 17(5) of CGST Act.
SCHEDULE I ACTIVITIES TO BE TREATED AS SUPPLY EVEN IF MADE WITHOUT CONSIDERATION
Reply By KASTURI SETHI:
The Reply:
After agreement with Sh.Sharad Anada Ji, I wo

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.e. Diwali gift to employee, Proviso to Schedule-I Para 2 is applicable.
Thanks,
With regards,
Reply By KASTURI SETHI:
The Reply:
Sh.Alkesh Jani Ji, You are right. Your role can be termed as "Match (issue) finisher" like M.S.Dhoni. Also being cool like him (Dhoni Cricketer). It has happened many times. It is a fact.
Reply By Alkesh Jani:
The Reply:
Sh. Kasturiji Sir,
I thank you, as you have always been a very good guide for all. You word of appericiation really matters a lot to me as well all the visitors of this site.
Thanks again,
With regards,
Reply By Ganeshan Kalyani:
The Reply:
Input tax credit on mobile, gift given to cameraman and its assistant as per section 17(5) of CGST Act.
Discussion Forum – Knowledge

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PROFITEERING MAKES CHOCOLATES BITTER
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 21-1-2019

Can chocolates always taste sweet and crunchy ! The answer may be different for consumers and manufacturer or supplier of chocolates. The National Anti-profiteering Authority (NAA) has recently pronounced an Order dated 07.12.2018 that when GST was reduced from 28% to 18% on chocolates w.e.f. 15 November, 2018, but supplier did not reduced the prices but continued to sell at same prices, it was a case of profiteering in contravention of the provisions of section 171 of the CGST Act, 2017. [Pushpak Chauhan and DGAP, CBIC, New Delhi v. Harish Bakers & Confectioners Pvt. Ltd., Gurugram (2018) 12 TMI 473(NAA) ].
Brief Facts
On a complaint by complainant to Standing Committee, it was alleged that despite reduction in GST rates from 28% to 18% w.e.f. 15.11.2017 on 'Nestle Munch Nuts' and 'Cadbury Dairy Milk Chocolates', the supplier continued to sell these products

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h investigated the complaint as per procedure.
Supplier's Submissions
The DGAP sought comments from the supplier as also suo-moto determination of quantum of benefit which had not been passed on after price reduction between 15.11.2017 to 31.03.2018. It submitted that since base price had been increased by the distributors, it increased the base prices keeping the same profit margin (15 % and 12 %) and sold the products at the original maximum retail price (MRP) as there was no change in the MRP.
While supplier submitted copies of purchase and sale invoices from November, 2017 to March, 2018 alongwith copies of returns, viz, GSTR-3B and GSTR-1, details of invoice wise outward supplies were not provided.
The supplier also submitted that :
* The complaint against it of not passing on the benefit of reduction in the GST rate to the customers and making profit was wrong as it had given details of all the basic components of the prices of the chocolates on the invoices and the benefi

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eased the base price from Rs. 31.25 to Rs. 33.90 maintaining the margin at 12% and hence he had not profiteered.
* It had reduced the rate of tax on the chocolates from 28% to 18% w.e.f. 15.11.2017 as per the Notification No. 41/2017- Central Tax (Rate) dated 14.11.2017.
* It did not intend to benefit on account of tax reduction and had not contravened the provisions of Section 171 (1) of the CGST Act, 2017.
* Since the Distributor had increased the basic purchase price, it was also forced to increase the basic sale price however, it had not increased the profit margin.
* Quantity discounts through various schemes which could not be construed as discounts on the basic prices as they had no connection with the reduction in the rate of tax as these discounts were not provided on every purchase and the amount was also different on each schemes. It was further pleaded that the above discounts did not fall in the category of benefit of GST rate reduction given to it.
It had not re

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bury had given discount to the retailer on the base price.
The invoice of Cadbury distributor categorically mentioned that the 'Anti- Profiteering provisions under GST Act require that you pass on the benefits of GST rate reduction given to you; to the consumers'. Similarly, the distributor of Nestle Chocolates had also sold Nestle Munch Nuts 32 Gm. bars through it's various sales invoices between November 2017 to March 2018 giving a discount clearly mentioning on the invoices 'with GST benefits where applicable'.
It was observed by DGAP that though the base prices were increased but since discounts were given by the distributors to the retailer, it was bound to pass on the benefit of reduction in the rate of tax w.e.f. 15.11.2017 to the customers. It was responsible for passing on the benefit as it was a registered supplier under the CGST/SGST Act, 2017.
It was revealed that supplier had purchased 910 units of Nestle Munch Nuts 32 Gm. and 4646 units of Cadbury Dairy Milk Chocol

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upplier was a registered supplier under GST law, it was legally bound to pass on the benefit of reduction in rate of tax to its customers.
Prices included both the base prices and also the tax charged on it and therefore, any excess amount collected from the recipients must be returned to them and if they were not identifiable, the same was to be deposited in the Consumer Welfare Fund (CWF).
NAA findings
Based on the submissions and DGAP report, the NAA observed as follows:
* The supplier had increased the base price by ₹ 1.56 per unit in respect of the Nestle Munch Nuts and ₹ 3.13 for the Cadbury Dairy Milk and hence the MRP charged on both the above products had remained ₹ 20/- and ₹ 40/- per unit respectively before and after the reduction in the rate of tax. Therefore, it was established that the supplier had in fact increased the base prices of these Chocolates and sold them at the same MRPs which he was charging before the reduction in the rate of ta

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stomers, therefore, it is quite apparent that he had deliberately charged the enhanced prices with an intention to pocket the amount which he was bound to pass on to the recipients.
* It can also not legally maintain that since it had not received the benefit from the distributors and hence it would not pass on the same as it was bound by the provisions of Section 171 being a registered dealer.
* Mere charging of 18% GST after 15.11.2018 cannot be construed to have resulted in the passing of the benefit unless the MRPs were reduced and the base prices were maintained.
* The claim that profit margins had remained the same is also not tenable as it had not only increased the base prices but had also earned additional margin on the enhanced prices.
* It had further forced the customers to pay additional GST on the increased base prices otherwise the customers should have got further benefit of reduced base prices.
* Perusal of the tax invoices issued by both the distributors sho

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and therefore, it is liable for action under Rule 133 of the CGST Rules, 2017.
The supplier had also issued incorrect invoices while selling the above products to its customers as he had not correctly shown the basic prices which he should have legally charged from them. The supplier had also forced them to pay additional GST on the increased prices and had also earned additional profit through the incorrect tax invoices which would have otherwise resulted in further benefit to the customers in the shape of reduced prices.
Conclusion
The supplier was directed to reduce the sale prices of the above products immediately commensurate to the reduction in the rate of tax as was notified on 14.11.2017 and pass on the benefit of reduction in the rate of the tax to its customers. Further it was directed to refund the same to the complainant along with interest @ 18% w.e.f. 16.11.2017 till the same is paid
Since supplier has also voluntarily deposited an amount of ₹ 1295/- in the Co

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Patrawala Corporation Versus Commissioner of CGST South Mumbai
Service Tax
2019 (3) TMI 417 – CESTAT MUMBAI – TMI
CESTAT MUMBAI – AT
Dated:- 21-1-2019
Appeal No. ST/86286/2018 – A/85325/2019
Service Tax
Mr. S.K. Mohanty, Member (Judicial)
None for appellant
Shri O.M. Shivdikar, A/C (AR) with Shri S.K. Hatangadi, Asst. Commr (AR) for respondent
ORDER
Per: S.K. Mohanty
None appeared for the appellant, despite notice.
2. On perusal of the order sheet, I find that the matter was listed on 20.06.2018, 08.08.2018, 27.08.2018, 04.10.2018, 12.11.2018, 05.12.2018 and 18.12.2018 for final hearing. Only in one of the occasions, the appellant present itself for arguing its case. This shows the casual approach of the appel

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llected the service tax amount from its client but did not deposit the same into the Government exchequer. For non-payment of service tax, the department proceeded against the appellant through issuance of show-cause notice. The matter was adjudicated vide order dated 20.03.2013, wherein the service tax demand was confirmed and the amount deposited during adjudication proceedings was appropriated along with interest in the said order. Besides, the adjudication order also imposed penalty under Section 76 of the Act. On appeal, the learned Commissioner (Appeals) vide the impugned order dated 20.12.2017 has upheld the adjudged demand of penalty confirmed on the appellant. Feeling aggrieved with the impugned order, the appellant has preferred t

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In Re: M/s. National Aluminium Company Limited
GST
2019 (2) TMI 1527 – APPELLATE AUTHORITY FOR ADVANCE RULING, ODISHA – 2019 (22) G. S. T. L. 526 (App. A. A. R. – GST)
APPELLATE AUTHORITY FOR ADVANCE RULING, ODISHA – AAAR
Dated:- 21-1-2019
ORDER 02-03/ODlSHA-AAAR/Appeal/2018-19
GST
SHRI RAKESH KUMAR SHARMA AND SHRI SASWAT MISHRA, MEMBER
Present For the Appellants
1. Shri P.K. Sahu, Advocate (For Appellant-I)
2. Dr. Kedarnath Tripathy, Advocate (For Appellant-I)
3. Shri M.M. Mishra, Sr. Manager (Finance), NALCO (For Appellant-I)
4. Shri P. Suna, DGM (Taxation Cell), NALCO (For Appellant-I)
5. Shri Sribas Nath, Asstt. Commissioner, GST fit CX, Bhubaneswar-I (For Appellant-II)
6. Shri K.C. Satapathy, Dy. Commissioner, CT 8t GST, Odisha (For jurisdictional officer)
M/s. National Aluminium Company Limited (Appellant-I), aggrieved by the Advance Ruling No.02/ODISHA-AAR/18-19, dated 28.09.2018, pronounced by the Odisha Authority for Advance Ruling, Bhubaneswar (A

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al petition, it has requested to set aside / modify the impugned Advance Ruling No.02/ODISHA-AAR/ 18-19 dated 28.09.2018 = 2018 (10) TMI 748 – AUTHORITY FOR ADVANCE RULING, ODISHA and allow input tax credit on inputs and input services used by them for maintenance of their township, security services and horticulture meant for township.
2.1. On the other hand, Commissioner, CX & GST, Bhubaneswar (Appellant-II) in his appeal petition, has submitted that the order passed by the AAR is not legal & proper to the extent of:-
(i) Allowing the input tax credit of the services utilized for maintenance of Guest House, Transit House and Trainee Hostel.
(ii) Allowing the input tax credit for the service utilized for plantation and gardening within the plant area including the mining area and the premises of other establishment like administrative building, guest house, transit house and training hostel.
3.0. The issue has arisen for adjudication consequent upon the Appellant-I seeking advance

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ch services, being nil rated, fall under exempt supplies.
(iii) Plantation and maintenance of such plantation outside the plant area, being for non-business use, will not qualify for input tax credit in terms of Section 17(1) of the CGST/OGST Act, 2017. Similarly, the service availed in relation to plant & garden in the residential colony will not qualify for input tax credit.
(iv) The Appellant-1 is entitled to input tax credit of the tax paid on inward supply of input and input service for maintenance of the guest house, transit house & training hostel but excluding the food & beverages provided in such establishment.
(v) Services availed in relation to plantation and gardening within the plant area including mining area and the premises of other business establishments will qualify for input tax credit.
4.0. M/s. National Aluminium Company Limited, (Appellant-I) in its grounds of Appeal, has assailed the ruling of AAR, inter-alia, on the following grounds.-
(i) The AAR has wron

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un large scale business of manufacturing, where thousands of employees are working. The fact that business plan for establishment plant included setting of the township as well, which show that township are integral part of smooth and effective functioning of the manufacturing activities.
(iv) the provisions under Section 16 of the CGST Act, 2017 prescribing eligible condition for taking input tax credit read with Section 2(17) of CGST Act, 2017 where the word 'business' has been defined, an activity or transaction in connection with or incidental or ancillary to sub-clause (a) of Section 2(17) of CGST Act 2017 are also covered under the scope and ambit of the definition of business. Not only the manufacturing activity but any incidental or ancillary activities thereof are also covered within the expression “business” in the GST laws. Maintenance of various facilities in residential townships is integrally related to the business activities of the appellant and not a welfare a

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paid on all the supplies received by the applicant in the course or furtherance of business is admissible without any whisper of doubt.
(vii) The AAR has ignored various rulings under the erstwhile Cenvat Credit Rules, 2004, wherein the credit of the tax paid on various services or duty paid on the goods has been allowed even if such services or goods are not directly used for providing taxable service or manufacturing of goods. The ratio of these rulings is squarely applicable in the present GST regime as provisions of tax credit in the present GST are more extensive than the provisions of the Cenvat Credit Rules, 2004.
(viii) A comparative reading of the provisions of the erstwhile cenvat credit rules and input tax credit in the present GST regime, it can be appreciated that earlier tax provisions were restrictive as compared to present tax provision. Hence, Tax credit in terms of section 16 of CGST Act, 2017 cannot be denied when such credit were allowed in the old regime. Hence,

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th smooth & effective running of its business of the appellant. The main purpose of appellant in providing such facilities is for the benefit of its own business.
(xi) The appellant's activities cannot be roped in as taxable supply for residential service by invoking paragraph 2 of Schedule I for the various reasons. The appellant has contended that there is no supply of goods or services to the employees. The appellant runs factories for manufacturing purposes, which are to be manned 24 hours every day. For efficient operation of the manufacturing activity in the factories, the appellant has made arrangement in the residential colonies near the factories, so that the employees can easily reach the workplace and readily available in the event of emergency situation. Thus, the residential colonies have been set-up and are being maintained by the appellant in the interest of its business. Therefore, facilities of maintenance in residential colonies, is integral part of the business

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of service provide through plantation & gardening within the plant area including mining area and the premises of other business establishment will qualify for input service credit appears to be incorrect. These services do not pass the legal test i.e. used or intended to be used in course or furtherance of business. The plantation and gardening within the plant area or the mines area of the applicant have no nexus with the manufacturing of Aluminium sheets and coils.
6.0. Appellant-I was given an opportunity to submit its objections and counter to the appeal filed by the Appellant-II. The Appellant-I In its counter, has submitted that section 16 of CGST Act entitles a registered person to take credit of input tax charged on any supply of services, which are used or intended to be used in the course or furtherance of his business.
7.0. During the course of the hearing on 07.01.2019, Shri P.K Sahu, Advocate on behalf of the Appellant-I reiterated the points as stated in its Grounds o

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of his business subject to such conditions and restrictions. “Input tax”, as defined in section 2(62) of the said Act, inter-alia, means the Central tax, State tax, Integrated tax or Union territory tax charged on any supply of goods or services of both made to him. In terms of clause 17 of section 2 of the OGST/CGST Act, 2017, “Business” inter-alia includes any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit and activity or transaction in connection with or incidental or ancillary thereto.
8.2. As per Section 17(5) (c) of the CGST / OGST Act, input tax credit shall not be available against works contract services when supplied for construction immovable property (other than plant and machinery) except where it is an p service for further supply of works contract service. Further, in terms of Section 17(5)(d), input tax credit shall not be available in respect of goods or service received

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(1) (c) that the expression supply includes the activities specified in Schedule-I, made or agreed to be made without a consideration. Supply of goods or services or both between related persons, when made without a consideration and in the course or furtherance of business is listed at SI.No.2 of the said Schedule-I. Explanation to Section 15 of the OGST/CGST Act specifies that employer and employees are deemed to be “related persons”. Proviso to SI. No. 2 of the said Schedule- I says that gifts not exceeding fifty thousand rupees in value in a financial year by an employee (without consideration) shall not be treated as supply of goods or services or both.
8.5 The appellant has also brought to our notice the clarification dated 10-07-2017 issued by Ministry of Finance. Government of India. Press Information Bureau, wherein it is clarified as follows. To quote:-
“It is being reported that gifts and perquisites supplied by companies to their employees will be taxed under GST. Gifts

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ST. Further, the Input Tax Credit (ITC) Scheme under GST does not allow ITC of membership of a club, health and fitness centre [section 17 (5) (b) (xi)] It follows, therefore, that if such services are provided free of charge to all the employees by the employer then the same will not be subjected to GST, provided appropriate GST was paid when procurer! by the employer The same would hold true for free housing to the employees, when the same is provided in terms of the contract between the employer and cost-to-company (C2C).”
(However the aforesaid clarification is of no help to the appellant-I, as discussed subsequently in this order).
8.6. Section 17(5) opens with a non obstante clause i.e. “Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax the aforesaid credit shall not be available in respect of the following, namely -…………….” in view of the aforesaid non-obstante clause, what is provided in Section 16(1) and

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ge 25 of his appeal petition. As clarified by the CBIC vide its Press Release dated 10.10.2017, referred to by the Appellant-I, perquisites are not subjected to GST. Therefore, since the perquisites are outside the scope of GST, input tax credit shall not be available to the Appellant-I in respect of tax paid on goods and services procured by it for management, repair, renovation, alteration or maintenance services (including watch and ward services, security services, Plantation/Gardening/Landscaping services, etc.) pertaining to residential accommodation for its employees in township/colony.
9.2. Perquisites are generally meant for the comfort, convenience and welfare of the employees. In the previous para, it has been stated that since perquisites are outside the scope of GST, benefit of input tax credit cannot be allowed to the Appellant-I pertaining to inward tax-paid supply of goods and/or services availed for providing the perquisites to its employees. However, for academic int

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The expression 'relating to business' in Rule 2 (l) of CENVAT Credit Rules, 2004 refers to activities which are integrally related to the business activity of the assessee and not welfare activities undertaken by the assessee.
9. Applying the ratio laid down by the Hon'ble Apex Court in the case of Maruti Suzuki Limited V. Commissioner of Central Excise, Delhi (2009 (8) TMI 14 – SUPREME COURT), we hold that unless the nexux is established between the services rendered and the business carried on by the assessee, the benefit of CENVAT credit is not allowable. In the present case, in our opinion, rendering taxable services at the residential colony established by the assessee for the benefit of the employees, is not an activity integrally connected with the business of the assessee and therefore, the tribunal was not justified in holding that the services such as repairs, maintenance and civil construction rendered at the residential colony constitutes 'input service&#3

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I is used for temporary accommodation of its employees as well as non employees. Thought the provision of guest house may not be treated as a perquisite, it cannot also be treated as an activity integrally related to the business of the Appellant-I. That means, the guest house service provided by the Appellant-I to its employees as well as non-employees cannot be treated as an activity in course or furtherance of its business. Hence, we are of the view that tax paid on inward supplies of goods and services in connection with the guest house cannot be allowed the benefit of input tax credit . To this extent, the appeal filed by the Appellant-II is sustainable and hence allowed.
9.5. The ruling of the AAR that services availed in relation to plantation and gardening within the plant area including mining area and the premises of other business establishments will qualify for input tax credit is found to be correct. Creation and maintenance of green area/zone inside plant/mining/office p

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nt-I has thus argued that the tax paid on expenditure incurred by him for the input/input services (which are held by us as not eligible for input tax credit) are taken into consideration for calculation of the cost of its final products and hence benefit of input tax credit should be available on such input/input services. In this regard, we just want to place on record the fact that the Hon'ble Bombay High Court, vide a subsequent order dated 25.10.2010 in in Central Excise Appeal No 7 of 2010 in the case of Commissioner Central Excise Vs M/s. Ultratech Cement Ltd. [2010(260) E.L.T. 369(Bom.)] = 2010 (10) TMI 13 – BOMBAY HIGH COURT, has interpreted the correct meaning of the order of the Honble High Court in the Coca Cola case. The relevant paras of the said order are extracted below:-
37. In the case of Coca Cola India Pvt. Ltd. (2009 (8) TMI 50 – BOMBAY HIGH COURT) a Division Bench of this Court has considered scope of the expression “input service' as defined in rule 2(1)

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rvices enumerated in the definition of input service itself. The Court rejected the contention of the revenue that a service to qualify as an input service must be used in or in relation to the manufacture of the final products and held that any service used in relation to the business of manufacturing the final product would be an eligible input service.
38. We concur with the above decision of this Court in the case of Coca Cola India Pvt. Ltd. (2009 (8) TMI 50 – BOMBAY HIGH COURT). However, in that case, this Court has also held that the coat of any input service that forms part of value of final products would be eligible for CENVAT credit. That observation of the Division Bench is made context of a service which is held to be integrally connected with the business of manufacturing the final product. Therefore, the observation of the Division Bench in the case of Coca Cola India Pvt. Ltd. (2009 (8) TMI 50 – BOMBAY HIGH COURT) has to be construed to mean that where the input servic

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Commissioner of Central Goods & Service Tax Versus M/s Fun Foods Pvt Ltd
Central Excise
2019 (2) TMI 82 – RAJASTHAN HIGH COURT – [2019] 64 G S.T.R. 176 (Raj), 2019 (366) E.L.T. 687 (Raj.)
RAJASTHAN HIGH COURT – HC
Dated:- 21-1-2019
D. B. Civil Miscellaneous Application No. 193/2018 In D.B. Central Excise Appeal No. 53/2017
Central Excise
Mr. Justice Mohammad Rafiq And Mr. Justice Goverdhan Bardhar
For the Applicant : Mr. Anuroop Singhi.
For the Respondent(s) : Mr. Yogendra Aldak with Mr. Arjun Singh on behalf of Mr. Sameer Jain.
ORDER
This application has been filed by the applicant-appellant seeking recall of order dated 11.04.2018 passed by this Court whereby the appeal filed by the Commissioner of Central Excise

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bmitted that the issue involved in the appeal was whether the Tribunal had erred in holding that the demand is beyond the period of one year from the relevant date and is time barred and further whether the Tribunal erred in dropping the penalty under Section 11AC of the Act on the assessee. Learned counsel submitted that the question before the Delhi High Court in Commissioner of Service Tax Vs. Ernest & Young Pvt. Ltd. (supra) was of determination of any question in relation to rate of duty and therefore, the appeal would have been maintainable before the Supreme Court in that case.
Even if the appellant-applicant had filed an appeal before the Supreme Court, it would not have been maintainable, argued the learned counsel for the applica

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e decided against the revenue and matter was remanded back. The aforesaid five issues identified by the Tribunal reads as under:
“(i) Classification of Milk Shake Mixes.
(ii) Classification of flavoured syrups/fruit syrups/Squashes.
(iii) Goods sold without brand name – Eligibility to claim benefit of exemption Notification No. 3/2005-CE dated 24.2.2005 (Sr. No. 9) in respect of chocolate syrup, Butter Scotch, Blue curacao. Grenadine, Mint, Orange, Triple Seed, Caramel, Natural Caramel, Vanila, Lime (all falling under Chapter Heading 2108.91/21069040) on the ground that the same do not bear brand name of the assessee/appellant.
(iv) Goods sold without brand name- Eligibility of exemption benefit under Notification No. 3/2005-CE (sup

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ITC accumulated due to inverted tax structure against supplies @.1%
Query (Issue) Started By: – MohanLal tiwari Dated:- 19-1-2019 Last Reply Date:- 21-1-2019 Goods and Services Tax – GST
Got 6 Replies
GST
Dear Panelists,
We are supplying goods to indigenous customers including Indian railway as well direct exports and through merchant exporters. We have got huge ITC accumulated due to supplies of goods to Railway way parts (HSN 8607) and supplies to merchant exporters @.1%.
Kindly

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Service tax audits under the 1994 Act can continue post-GST implementation on July 1, 2017.
Case-Laws
Service Tax
Jurisdiction – service tax audit – an enquiry or an investigation or even a l

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Input Tax Credit against Stock Transfer from factory to godown
Query (Issue) Started By: – Kaustubh Karandikar Dated:- 19-1-2019 Last Reply Date:- 26-1-2019 Goods and Services Tax – GST
Got 4 Replies
GST
XYZ having manufacturing unit at Gujarat and godown in Maharashtra. When the goods are stock transferred from Gujarat to Maharashtra, GST is paid on it being distinct person concept under GST provisions and Maharashtra is taking credit of the GST charged by Gujarat. However, since b

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Physical filing for inverted duty structure Refund
Query (Issue) Started By: – aayushi singhal Dated:- 19-1-2019 Last Reply Date:- 21-1-2019 Goods and Services Tax – GST
Got 10 Replies
GST
Is the option for filing refund application in RFD-01A for inverted duty structure refund still available. Or we have to go for online filing only.
Reply By SHARAD ANADA:
The Reply:
Till now file online and submit docs offline
Reply By KASTURI SETHI:
The Reply:
First requirement is to file online. If you find snag in the Common Portal System, then file manually with jurisdictional GST Division Office. After filing online, a copy of application along with acknowledgement is to be submitted manually. Actually both procedures are in force.

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ble to file the application because of snag, you can file the application manually in the office. There is Board's instructions to this effect.
Reply By aayushi singhal:
The Reply:
Thankyou Sir.
Is there any specific notification to this effect?
Reply By KASTURI SETHI:
The Reply:
I shall revert soon. But I am also of the view that Grievance Redressal Cell (help desk) must be contacted for expeditiously remedy as advised by M/s.Yagay and Sun, Sirs. Try both ways.
Reply By KASTURI SETHI:
The Reply:
Refunds under GST
Manual claims in respect of inverted duty structure
Refund claims on account of inverted duty structure shall be filed for a tax period on a monthly basis in FORM GST RFD-01A. However, the registered persons having a

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notified, it has been decided by the competent authority to sanction refund of provisionally accepted input tax credit at this juncture. However, the registered persons applying for refund is required to give an undertaking to the effect that the amount of refund sanctioned would be paid back to the Government with interest in case it is found subsequently that the requirements of clause (c) of sub-section (2) of section 16 read with sub-section (2) of section 42 of the CGST Act, 2017 have not been complied with in respect of the amount refunded. This undertaking should be submitted manually along with the refund claim till the same is available in FORM RFD-01A on the common portal. Further the prescribed statements – Statement 1 and Statem

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Case laws behinf Input Tax Credit
Query (Issue) Started By: – Ritesh Mehta Dated:- 19-1-2019 Last Reply Date:- 26-1-2019 Goods and Services Tax – GST
Got 5 Replies
GST
Can anyone please share some of the landmark judgements on Input Tax Credit ??
Reply By DR.MARIAPPAN GOVINDARAJAN:
The Reply:
If you want case law for any specific matter or you may refer so many case laws in this site itself.
Reply By Ritesh Mehta:
The Reply:
I am looking for landmark judgement in relation to inp

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GST – RCM ITC QUERY
Query (Issue) Started By: – IRFAN MALIK Dated:- 19-1-2019 Last Reply Date:- 26-1-2019 Goods and Services Tax – GST
Got 5 Replies
GST
Have recd transportation service from GTA in dec 2018.
Now I have paid GST under RCM on 19th January 2019.
Query is when can I claim ITC of GST paid under RCM, whether at the time of filing GSTR 3B for Dec 2018 or whether at the time of filing GSTR 3B for Jan 2019??
Thanking you in anticpation….
Regards
-Irfan
Reply By KASTU

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Reverse charge on repairs carried out outside India
Query (Issue) Started By: – Kaustubh Karandikar Dated:- 19-1-2019 Last Reply Date:- 19-1-2019 Goods and Services Tax – GST
Got 2 Replies
GST
XYZ (Manufacturer from India) received back the goods from PQR (U.K.) after repairs under the cover of a Bill of Entry for the repaired goods and XYZ had taken credit of the IGST charged in the Bill of Entry. PQR had carried out the repairs outside India i.e. in U.K. PQR had issued a separate

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Issue of Tax Invoice Against Material Rejection by Customer instead of Debit Note
Query (Issue) Started By: – ACCOUNTS MANAGER Dated:- 19-1-2019 Last Reply Date:- 26-1-2019 Goods and Services Tax – GST
Got 2 Replies
GST
Hiii…
Few of our customer (OEM) has issued Tax Invoice against material rejection and also shown in their GSTR-1 as sales. And we issued Credit Note for the same and shown in GSTR-1 which is required as per GST.
Question is that they issued Tax Invoice as per GST Rules which is ok but how can they show in GSTR-1 as new sales???… Because same is reflected in our GSTR-2A which is wrong because it is not our purchase.
I want to understand treatment of Customer as why they show this transaction as Sales and n

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purchaser of same and asked him to accept the credit note, and documented the same and the purchaser should have sent the material back on delivery challan as per rule 55(1)(c) since you have filed your gstr-1 and reduced your output tax and the purchaser will also have to reduce his itc based on the revised GSTR-1 file which will be mirrored in the GSTR-2A.
however this leads us nowhere as compliance will remain an issue regarding itc reversal by purchaser etc.
Hence In terms of circular issued for pharma companies (in which they have mentioned that it can be used in other cases also ie other than pharma as principles remain same which they have mentioned in the ciruclar also) please refer to Circular No. 72/46/2018-GST
The value of th

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