Goods and Services Tax

M/s. Coimbatore Enterprises and Holdings Ltd. Versus GST & CE, Coimbatore
Service Tax
2019 (1) TMI 1039 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 16-1-2019
Appeal No. ST/42246/2018 – FINAL ORDER No. 40115/2019
Service Tax
Shri P. Dinesha, Member (Judicial)
Shri A. Gopal Kanakaraj, CA for the Appellant
Shri L. Nandakumar, AC (AR) for the Respondent
ORDER
The dispute relates to the period 01.01.2013 to 30.09.2013. By this appeal the assessee is challenging the penalty levied by the adjudicating authority and confirmed in the impugned order by the Commissioner GST & CE (Appeals), under Section 77 and 78 of the Finance Act, 1994.
2. Today when the matter came up for hearing, Shri Gopal Kanakaraj, CA, appearing for the assessee-appellant submitted that the first appellate authority has modified the order of the adjudicating authority to the extent of upholding the invocation of extended period, recovery of late fee and penalties imposed under Section 77

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

. Hence, except delay in filing service tax electronically, no other contravention of any of the provisions of service tax, for which penal action under Section 78 of the Act ibid is unwarranted. Further, appellant voluntarily paid penalty in addition to tax, interest and late fee, which would establish its bonafide actions. He relies on various Tribunal rulings setting aside penalty under Section 78. He relies on the following case laws in support of his contentions:
1. 2017 (4)GSTL 57 (Tri.-Mum.) Raghuvir Motors Agencies PVt. Ltd. Vs. CCE & ST, Aurangabad
2. 2018 (14) GSTL 281 (tri.-Del.) R.K. Refreshment & Enterprises (P) Ltd. Vs. CCE, Raipur
3. Per contra, Ld. AR opposes the arguments put forth by the appellant. He submits that after initiation of investigation by the department only the appellant paid the service tax along with interest, late fee and filed ST-3 returns and hence penal action for the act of non-compliance of the provisions of Finance Act on the part of the appel

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

etc. and secondly, the provisions of Section 78 stand controlled by Section 80 of the Finance Act, 1994, ibid. This makes that for every default, penalties under Section 77 and 78 are not automatic.
4.2 In the case on hand, much before the issuance of show cause notice the assessee has got itself registered, paid the taxes along with applicable interest and this also is established by the fact that the same is appropriated in the Order-in-Original. In the SCN as well as the orders of the lower authorities, the Revenue has but for reiterating the wordings in the Sections itself, has not gone beyond that to put on record any reasons on the alleged malafides, fraud or suppression, etc. In the event, I am of the considered opinion that the impugned penalties cannot sustain for which reason, I set aside the impugned order confirming penalty. Consequently, the penalties are directed to be deleted and the appeal stands allowed.
(Operative part of the Order pronounced in the open Court)

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Shri Surya Prakash Loonker, And Director General Anti-Profiteering, Central Board of Indirect Taxes & Customs, Versus M/s. Excel Rasayan Pvt. Ltd.,
GST
2019 (1) TMI 807 – NATIONAL ANTI-PROFITEERING AUTHORITY – TMI
NATIONAL ANTI-PROFITEERING AUTHORITY – NAPA
Dated:- 16-1-2019
Case No. 02/2019
GST
SH. B. N. SHARMA, CHAIRMAN, SH. J. C. CHAUHAN, TECHNICAL MEMBER, SH. AMAND SHAH, TECHNICAL MEMBER
None for the Applicant No. 1.
Ms. Gayatri, Deputy Commissioner, for the Applicant No. 2.
Sh. Rakesh Upadhyaya, Director and Dr. Prabhat Kumar, Advocate for the Respondent.
ORDER
1. The present Report, dated 04.09.2018, has been received on 07.09.2018 from the Director General of Anti-Profiteering (DGAP) after detailed investigation under Rule 129 (6) of the Central Goods & Services Tax (CGST) Rules, 2017. The brief facts of the case are that an application dated 22.02.2018 was filed by the Applicant No. 1 before the Standing Committee, constituted under Rule 123 (1) of th

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

letters dated 1 1.04.2018 and 19.05.2018 that prior to coming into force of the GST, he was a SSI unit, manufacturing synthetic detergents falling under Chapter 34 of the erstwhile Central Excise Tariff Act, 1944 and that he had been availing SSI exemption and charging VAT @ 12.5 % on the base prices. He had further submitted that on introduction of the GST, 28% tax was levied and since this disturbed his pricing pattern he had reduced the base prices. He had also stated that w.e.f. 15.11 .2017, when the CST rate on his products in question was reduced from 28% to 18%, though the base prices were increased, they were much less than the base prices in the Pre-GST era.
3. The DGAP's report submitted that the Respondent had also filed details of invoice-wise outward taxable supplies (other than zero rated) and State-wise details for all the products from 01.11.2017 to 31.03.2018 along with copies of GSTR-1, GSTR-3B, Audited Balance Sheet and the Sample invoices. The DGAP after exami

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

the total amount of profiteering covering the period between 15.11.2017 to 31.03.2018, came out to be Rs. 4,64,849.74, but the Applicant No. 1 was supplied Fortune ADW Detergent 1 kg. at the price of Rs. 186.99 and Fortune Rinse Aid 500 ml. at the price of Rs. 127.49 which were lower than the commensurate cum-tax prices of these products and therefore, the Applicant was not eligible for any refund.
4. The above Report was considered by the Authority in it's meeting held on 11.09.2018 and it was decided to hear the interested parties on 26.09.2018, however no one appeared on behalf of the Respondent & Applicant No. 1. Another Notice dated 03.10.2018 was issued and accordingly hearing was held on 12.10.2018. Sh. Rakesh Upadhyaya, Director and Sh. Prabhat Kumar, Advocate, appeared on behalf of the Respondent, no one appeared on behalf of the Applicant No. 1, and Ms. Gayatri, Deputy Commissioner appeared on behalf of the DGAP.
5. The Respondent in his written submissions dated 10.10.

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

tax was enhanced. He has also quoted the Hon'ble Finance Minister stating that the GST rate of 28% was tax neutral and only pertained to those units which were paying 12% Central Excise Duty and VAT @ 12.5%. However, this rate did not apply to him as he was availing exemption under the SSI notification. The above submissions of the Respondent were forwarded to the DGAP for reply who vide his submission dated 22.10.2018 stated that the Respondent has reiterated the earlier submissions and nothing more was to be added by the DGAP. Final price to the consumers, as per the submissions made by the Respondent, is as per the table given below:-
Final rice to the Consumers
Year
Month/Qtr.
ADW
Rinse Aid
ADW
Rinse Aid
VAT 12.5%
GST @ 28%
GST @ 18%
2016
Prior to GST
 
 
 
 
 
 
 
 
 
 
 
April
220
150
195.50
133.40
24.44
16.68
0
0
0
0
 
October
220
150
195.50
133.40
24.44
16.68
0
0
0
0

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

f the Authority to determine whether any reduction in the rate of tax on any supply of goods or services or the benefit of Input Tax Credit (ITC) has been passed on to the recipient by way of commensurate reduction in the prices or not? In the instant case the Respondent has not disputed the fact that there has been reduction in the rate of tax from 28% to 18% with effect from 15th November 2017 vide Notification No. 41/2017- Central Tax (Rate) dated 14.1 1 .2017 and has also not disputed the calculation made by the DGAP based on his outward sales data. The DGAP vide Annexure-II of his report has quantified profiteered amount as Rs. 4,64,849/- in which he has taken the actual selling price of Fortune ADW Detergent 1 Kg. i.e. Rs. 220/- and worked out the base price and the commensurate cum-tax price. The base price of the above product before rate reduction on 14.11.2017 was Rs. 171.80 and the Post-GST rate reduction it was Rs. 186.44 which has not been disputed as can be seen from the

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

(April to December 2016) to Rs. 117.19 (July to November 2017) and Rs. 127.12 (15.1 1.2017 to March 2018). For this product also he has claimed that though the base price has increased from Rs. 117.19 to Rs. 127.12 after rate reduction in November 2017, the base price had remained less than Rs. 133.40 which was prevalent prior to the introduction of GST. Thus the Respondent has claimed that the consumer had effectively paid the same price or less price which was prevalent in pre GST era. However, this argument of the Respondent does not hold good as not to increase the MRPs when tax rates were increased on account of implementation of the GST, was the business call taken by him and therefore he cannot claim any concession on this ground. The benefits arising due to the GST rate reduction cannot be denied to the consumers just because in the earlier scenario MRPs were not changed to extend some extra benefit to the consumers. It has also been found that the base price of both the above

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

rofiteered an amount of Rs. 4,64,849.74 for the period w.e.f. 15.11.2017 to 31.03.2018. However as far as the Applicant No. 1 is concerned he has bought both the above products @ Rs. 186.99 (Fortune ADW Detergent 1 Kg.) and at Rs. 127.49 (Fortune Rinse AID 500 ml.) which are lower than the commensurate cum tax prices. Therefore there is no profiteering in respect of the products purchased by him.
8. From the above discussions, it is clear that the Respondent has admittedly not passed on the benefit of tax reduction since the base prices of the above two products were increased to maintain the same selling prices which were existing before the reduction in the rate of tax. The Respondent, who is a registered manufacturer, is liable to pass on the benefit to the recipients irrespective of the fact whether the base prices are still lower as compared to the pre-GST price or not. Moreover, from the documents submitted to the DGAP by the Respondent it is also established that the base price

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ected to deposit the profiteered amount of Rs. 4,64,849.74 into the Consumer Welfare Fund as per the provisions of Rule 133 (3) (c) in the ratio of 50:50 in the Central and the State Consumer Welfare Funds, along with interest at the rate of 18% to be calculated from the date of collection of the higher amount till the date of deposit into the Consumer Welfare Fund. Out of the entire profiteered amount of Rs. 4,64,849.74, an amount of Rs. 2,32,424.87 will be deposited into the Central Consumer Welfare Fund and the balance amount shall be deposited into the State Consumer Welfare Fund as per the Table-I given below. The Authority, as per Rule 136 of the CGST Rules, 2017, directs the DGAP and the respective Commissioners of both CGST and SGST to monitor this order by ensuring that the amount profiteered by the Respondent as ordered by the Authority, is deposited in the Consumer Welfare Funds within a period of 3 months from the date of receipt of this order, along with interest failing w

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Haveli
28.37
Grand Total
232424.87
10. It is clear from the narration of the facts stated above that the Respondent has indulged in profiteering in violation of the provisions of  Section 171 of the CGST Act, 2017 and has not passed on the benefit of reduction of tax as per the Notification 41/2017-Central Tax(Rate) dated 14.11.2017 in respect of the above products to his customers and therefore, he is liable for penalty under Rule 133(3)(d) of the CGST Rules, 2017, the relevant provisions of which state as under:-
“133. x-x-x-x-x-x-x-x-x-x-x-x-x-x-x-xx-x-x-x-x-x-x-x-x-x-x-x-x-x-x-xx-x
(3) Where the Authority determines that a registered person has not passed on the benefit of the reduction in the rate of tax on the supply of goods or services or the benefit of input tax credit to the recipient by way of commensurate reduction in prices, the
Authority may order –
(a) reduction in prices:
(b) return to the recipient, an amount equivalent to the amount not passed on by the

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ovisions, the Respondent had not put forth any submissions on them except stating that he had not profiteered as has been discussed in para 5 above. As it is clear from the facts of the present case that the Respondent was fully aware of the Notification No. 41/2017-Central Tax (Rate) dated 14.11.2017 whereby the rate of GST was reduced from 28% to 18% and he was also fully aware of Section 171 of the CGST Act 2017, whereby he was bound to pass on the benefit of reduction in the rate of tax by commensurate reduction in the prices of the products in question, therefore he is liable for penalty. The Respondent has deliberately defied the law on the pretext that he had not increased the prices of his products when the rate of tax was increased to 28% and increased the base prices to maintain the same old selling price prior to reduction of rate of tax from 28% to 18%, by issuing wrong invoices to his recipients. Accordingly, he has committed an offence under section 122 (1) (i) of the abo

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Detention order issued for non-compliance with Section 129(4); rectified after objections, no malafide intent found.
Case-Laws
GST
Detention order – non-compliance of the mandate under the provisions of Section 129(4) of the Act – The Proper Officer realizing the lacuna, has proceeded to pass the rectification order after taking into consideration the objections – Hence, no malafides can be attributed to the same.
TMI Updates – Highlights, quick notes, marquee, annotation, news, ale

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

RECENT AMENDMENTS IN GOODS AND SERVICES TAX RULES, 2017
By: – DR.MARIAPPAN GOVINDARAJAN
Goods and Services Tax – GST
Dated:- 15-1-2019

Vide Notification No. 74/2018-Central Tax, dated 31.12.2018 the Central Government made the Central Goods and Services Tax (Fourteenth Amendment) Rules, 2018 further to amend the Central Goods and Services Tax Rules, 2017. These rules, unless otherwise stipulated, came into effect from 31.12.2018.
Grant of registration to persons required to deduct tax at source or to collect tax at source
Rule 12 provides the procedure for grant of registration to the persons required to deduct tax at source or to collect tax at source. The amendment inserted Rule 12(1A) after Rule 12(1). The newly inserted rule provides that a person applying for registration to collect tax in accordance with the provisions of section 52, in a State or Union territory where he does not have a physical presence, shall mention the name of the State or Union territory i

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

he supplier; or
* his authorized representative
shall not be required in the case of issuance of an electronic invoice in accordance with the provisions of the Information Technology Act, 2000.
Bill of supply
The amendment inserted third proviso to Rule 46. The newly inserted proviso provides that the signature or digital signature of-
* the supplier; or
* his authorized representative
shall not be required in the case of issuance of an electronic invoice in accordance with the provisions of the Information Technology Act, 2000.
Consolidated tax invoice
Rule 54(2) provides that where the supplier of taxable service is an insurer or a banking company or a financial institution, including a non-banking financial company, the said supplier may issue a consolidated tax invoice or any other document in lieu thereof, by whatever name called for the supply of services made during a month at the end of the month, whether issued or made available, physically or electronically whethe

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

the signature or digital signature of the supplier or his authorized representative shall not be required in the case of issuance of ticket in accordance with the provisions of the Information Technology Act, 2000.
Adjusted total turnover
Rule 89(5) provides that 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} – tax payable on such inverted rated supply of goods and services.
Explanation:- For the purposes of this sub-rule, the expressions –
(a) Net ITC shall mean input tax credit availed on inputs during the relevant period other than the input tax credit availed for which refund is claimed under sub-rules (4A) or (4B) or both; and
(b) Adjusted Total turnover shall have the same meaning as assigned to it in sub-rule (4).
The amendment substituted clause (b) of Explan

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

words 'or part thereof' after the worlds 'financial year'.
Notice to person and order of revisional authority in case of revision
The amendment inserted Rule 109B. The newly inserted Rule 109B(1) provides that where the Revisional Authority decides to pass an order in revision under section 108 which is likely to affect the person adversely, the Revisional Authority shall serve on him a notice in FORM GST RVN-01 and shall give him a reasonable opportunity of being heard.
Rule 109B(2) provides that the Revisional Authority shall, along with its order under sub-section (1) of section 108, issue a summary of the order in FORM GST APL-04 clearly indicating the final amount of demand confirmed.
Changes in E-way Bill
The amendment substituted Explanation 1 to rule 138(1). The newly substituted Explanation 1 provides defines the term 'handicrafts'. The term 'handicrafts' is defined as having the meaning as assigned to it in the Government of India, Ministry of Finance, notification No.

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

months.
The first proviso to this rule provides that the Commissioner may, on sufficient cause being shown and for reasons to be recorded in writing, by order, allow furnishing of the said information in PART A of FORM GST EWB 01, subject to such conditions and restrictions as may be specified by him.
The second proviso to this Rule provides that no order rejecting the request of such person to furnish the information in PART A of FORM GST EWB 01 under the first proviso shall be passed without affording the said person a reasonable opportunity of being heard.
The third proviso to this rule provides that the permission granted or rejected by the Commissioner of State tax or Commissioner of Union territory tax shall be deemed to be granted or, as the case may be, rejected by the Commissioner.
The explanation to this Rule defines the term 'Commissioner' as the jurisdictional Commissioner in respect of the persons specified in clauses (a) and (b).
Forms
The amendment inserted the fol

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Seeks to amend notification No. FIN/REV-3/GST/1/08 (Pt-1)/52 dated the 26th October, 2017
FIN/REV-3/GST/1/08(Pt-1)(Vol.1)/18 Dated:- 15-1-2019 Nagaland SGST
GST – States
Nagaland SGST
Nagaland SGST
GOVERNMENT OF NAGALAND
FINANCE DEPARTMENT
(REVENUE BRANCH)
F.NO. FIN/REV-3/GST/1/08(Pt-1)(Vol.1)/18
Dated: 15th January, 2019
NOTIFICATION
In exercise of the powers conferred by section 147 of the Nagaland Goods and Services Tax Act, 2017 (4 of 2017), the State Government, on the recommendations of the Council, hereby makes the following amendment in the notification of the Government of Nagaland, Finance Department (Revenue Branch), F.NO.FIN/REV-3/GST/1/08 (Pt-1)/52 dated the 26th October, 2017, namely:-
In the said notific

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Mahle Engine Components Pvt. Ltd. Versus CGST, C.E. & S.T., Indore
Central Excise
2019 (1) TMI 771 – CESTAT NEW DELHI – TMI
CESTAT NEW DELHI – AT
Dated:- 15-1-2019
Excise Appeal No. E/53163/2018 [SM] – FINAL ORDER No. 50046/2019
Central Excise
MRS. RACHNA GUPTA, MEMBER (JUDICIAL)
Present for the Appellant: Mr. D.K. Tyagi, Advocate
Present for the Respondent: Mr. K. Poddar, DR
ORDER
PER: RACHNA GUPTA
M/s Mahle Engine Components Pvt. Ltd., the appellants are engaged in the manufacture of Camshaft and Cylinder Liner. They are also availing the facility of cenvat credit under Cenvat Credit Rules, 2004 and payment of duty on monthly basis as provided under Rule 8 of Central Excise Rules, 2002. During the course of audit of records of the appellants for the period from April 2013 to March 2016 it was observed that appellant have availed cenvat credit of service tax Rs. 5,84,363/- paid on Maintenance Charges recovered by M/s M.P. Audyogic Kendra Vikas Nigam (AKVN) In

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

re eligible input services, as the definition of input service does not mandate that the service should be availed in the factory premises. The reliance is placed on the decision reported as Commr. of C. Ex., Cus. & S.T., Visakhapatnam-I Vs. Facor Alloys Ltd. 2017 (48) STR 491 (Tri.-Hyd.). Further, such services were availed for the business of manufacture of excisable goods and the business was not possible without the use of such services and therefore these services were related to manufacture of goods and therefore eligible input service, maintenance amount being part of the lease rental of the business premises. Since, the lease rental charges of the business premises are eligible input services such services remain the eligible input services. The reliance is placed on the decision reported as Phoenix Mills Ltd. Vs. C.S.T., Mumbai-I 2016 (46) STR 120 (Tri.-Mum.).
3. From the argument of both the parties, the narrow compass of adjudication appears to be whether Maintenance Charg

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

turing activity of appellant is carried from the premises as are taken on rent. It is apparent from record that the impugned maintenance charges are the part of lease/ rent charges. M/s AKVN i.e. the leaser is also charging the service charges in their lease bills raised for lease amount and maintenance amount. Though the maintenance is for roads, street lights, drainage, etc. i.e. for facilities being provided beyond the manufacturing/ factory premises of appellant but the simultaneous fact is that such services are charged on the basis of per square meter of business premises occupied by the appellant. Hence, were very much the part of lease/ rent of the impugned premises. The lease/ rent charge are the eligible inputs, so are to my opinion the maintenance charges. I draw my support from the decision of Hon'ble Apex Court in Karnani Properties case as was relied upon by Tribunal Mumbai in the decision reported as 2016 (46) STR 30 wherein it is held that without maintenance of adjoini

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Seeks to amend notification No. 48/2017 to amend the meaning of Advance Authorisation
01/2019 Dated:- 15-1-2019 Central GST (CGST)
GST
CGST
CGST
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(Department of Revenue)
[CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS]
Notification No. 1/2019-Central Tax
New Delhi, the 15th January, 2019
G.S.R. 33 (E).- In exercise of the powers conferred by section 147 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance, Department of Revenue No. 48/2017-Central Tax dated the 18th October, 2017 published in the Gazette

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

RCM-Applicability to a Trader
Query (Issue) Started By: – swamynathan pitchai Dated:- 14-1-2019 Last Reply Date:- 14-1-2019 Goods and Services Tax – GST
Got 2 Replies
GST
Dear sir
A is the manufacturer at GJ.
B is the End user at TN ordered a product X on A.
B intend to transport X from A's place at GJ to B's project site at MH.
Trading firm C (Only GST registered – sole proprietorship firm) @ KA intend to take this order from B. Since C does not have vehicles C wants to utilise the service of GTA. Hence C introduces a GTA D and offload the order. C is the authorised agent of D to promote their business formally entered an agreement.
C receives the order from B and offload to D
D will raise the bill to C and C w

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Recommendations & decision taken by GST Council in meeting held on 10.01.2019.
By: – Ganeshan Kalyani
Goods and Services Tax – GST
Dated:- 14-1-2019

New Cess in the State of Kerala:
* Revenue Mobilization for Natural Calamities: GST Council approved Levy of Cess on Intra-State Supply of Goods and Services within the State of Kerala at a rate not exceeding 1% for a period not exceeding 2 years.
Composition Scheme:
Increase in Turnover Limit: The limit of Annual Turnover in the preceding Financial Year for availing Composition Scheme for Goods shall be increased from ₹ 1 crore to ₹ 1.5 crore. This change will be made operational from the 1st of April, 2019.
Compliance Simplification: The compliance under Com

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

axes along with a Simple Declaration.
* The above changes will be made operational from the 1st of April, 2019.
Composition Scheme to Residential Segment and tax on lotteries.
* A seven Member Group of Ministers shall be constituted to examine the proposal of giving a Composition Scheme to Boost the Residential Segment of the Real Estate Sector.
* And a Group of Ministers shall be constituted to examine the GST Rate Structure on Lotteries.
Threshold limit for registration:
Higher Exemption Threshold Limit for Supplier of Goods: There would be two threshold Limits for exemption from Registration and Payment of GST for the suppliers of Goods i.e. ₹ 40 lakhs and ₹ 20 lakhs. States would have an option to decide about on

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

M/s. Diaspark Infotech Pvt. Ltd. Versus CGST, CE & CC, Indore
Service Tax
2019 (2) TMI 948 – CESTAT NEW DELHI – TMI
CESTAT NEW DELHI – AT
Dated:- 14-1-2019
Service Tax Appeal No.ST/51524/2018-ST [SM] – A/50080/2019-SM[BR]
Service Tax
MRS. RACHNA GUPTA, MEMBER (JUDICIAL)
Present for the Appellant: Mr. Manish Saharan, Advocates
Present for the Respondent: Mr. P.R. Gupta, D.R.
ORDER
PER: RACHNA GUPTA
Present appeal has been directed against order in appeal No. IND-EXCUS -000-APP-757-17-18 dated 26.03.2018 passed by the Commissioner (Appeals), CGST & Central Excise, Indore.
2. The facts relevant for the adjudication are that the appellant who provides an output service, which was exported without payment of service tax. Since they were entitled for availing cenvat credit that the appellant filed a refund claim for Rs. 7,36,702/- vide their application dated 18.06.2012 However, vide show cause notice No.2611 dated 12.05.2017 the rejection of the said refund cl

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

t the end of quarter for which refund claim is being made or at the time of filing of the refund claim, whichever is less. It is submitted that though inadvertently in the impugned ST-3, the balance was shown 'Nil'. But it was highly inappropriate on the part of the adjudicating authorities below to ignore the relevant documents as were submitted by the appellant to show the existing balance in accordance whereof the impugned refund was filed. Ld. Counsel has impressed upon that while replying the show cause notice itself, a Certificate from the Chartered Accountant certifying the claim of accumulated cenvat credit of Rs. 7,36,702/- was furnished. Alongwith the said certificate all the requisite declarations and documents as that of invoices were also submitted still the authority below has emphasized merely on ST-3 returns despite the fact that request for submitting for the correct returns was placed before the Range Superintendent rather twice which were not considered. Ld. Counsel

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

within a period of 90 days that too electronically. None, admittedly, was the case of the appellant. The impugned modification was proposed after a gap of 8 months. The Commission (Appeals) has rightly adjudicated the controversy in the given circumstances. Appeal is accordingly, prayed to be dismissed.
6. After hearing both the parties and perusing the entire record, I find that it is an admitted fact that the appellant is providing an output service, which was exported but appellant was entitled to credit, due to which, the impugned refund was filed by the appellant. I also find that the adjudicating authority below have rejected the refund claim holding that one of the conditions of Notification No.27/2012 has not been complied upon. The said condition No. (g) is one among various conditions (a) to (i) as provided in the Notification and it reads as under:-
(g) the amount of refund claimed shall not be more than the amount lying in the balance at the end of quarter for which refu

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

e impugned period is showing 'Nil' balance, had requested the Department vide their letter dated 28.12.2016 (received on the same date) and subsequently vide letter dated 13.01.2017 (received on 16.01.2017) to permit the submission of revised ST-3 return for the impugned period so as to rectify the mistake of cenvat credit figures, but the same has been denied by the Department. Though reliance upon rule 7 B of Service Tax Rules has been placed. According to which a revised ST- 3 return can be filed by an assessee within a period of 90 days and the said rule is taken as a ground to reject the request of the assessee/appellant to submit the revised ST-3 return, but I am of the opinion that Rule 7 B will have no substantive implication in a case where the assessee has cogent documentary evidence to support that the proposed revision of ST-3 is utmost important. In the present case, the ST -3 is showing nil balance, whereas the voluminous documents of the appellant are showing the balance

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

pending, and if, by an Act of Parliament the mode of procedure is altered, he has no other right than to proceed according to the altered mode. A procedural law should not ordinarily be construed as mandatory, the procedural law is always subservient to and is in aid to justice. Any interpretation which eludes or frustrates the recipient of justice is not to be followed.”
9. In another decision in the case of Salem Advocate Bar Assn. v. Union of India reported in 2005 (6) SCC 344 the Hon'ble Apex Court has considered the question as to whether the Court has any power or jurisdiction to extend the period beyond 90 days. It was held as follows:-
“It has been common practice for the parties to take long adjournments for filing written statements. The legislature with a view to curb this practice and to avoid unnecessary delay and adjournments, has provided for the maximum period. The mandatory or directory of such provision shall have to be determined by having regard to the object so

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

n discarded as nonest. The Tribunal further held as follows:-
“In view of the provision of Rule 7C of the Rules, the revised return cannot be ignored simply on the ground that the same has been filed after a period provided under Rule 7B of the Rules. In these circumstances, we find that the matter requires re-consideration by the adjudicating authority in view of the provision of Rule 7C of the Rules. The impugned order is set aside, after waiving pre-deposit of the amount of service tax, interest and penalty and the matter is remanded to the adjudicating authority to decide the issue afresh after offering an opportunity of hearing to the appellant. The appeal is allowed by way of remand.”
12. This Tribunal in the case of Serco Global Services Pvt. Ltd. vs. Commissioner of Central Excise, Delhi-III reported in 2015 – TIOL – 1044-CESTAT-Del. has held that even if ST-3 return for a particular period do not show any unutilized balance of cenvat credit, the refund still is to be grante

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

M/s MDP Infra (India) Pvt. Ltd. Versus Commissioner, Customs, Central Excise & CGST
Service Tax
2019 (2) TMI 208 – MADHYA PRADESH HIGH COURT – [2019] 65 G S.T.R. 51 (MP), 2019 (29) G. S. T. L. 296 (M. P.)
MADHYA PRADESH HIGH COURT – HC
Dated:- 14-1-2019
C.E.A. No. 123/2018
Service Tax
Sanjay Yadav And Vivek Agarwal JJ.
For the Appellant : Shri Gautam Prasad Sharma, learned counsel with Ms. Smrati Sharma, learned counsel
For the Respondent : Shri Praveen Surange, learned counsel
ORDER
This appeal under Section 35G(1) of the Central Excise Act, 1944 is directed against the final order No. A/51822/2018-SM(BR) dated 14/05/2018 passed by the Customs, Excise and Service Tax Appellate Tribunal, whereby, the Tribunal has upheld the rejection of application for refund claim of Rs. 25,49,317/-, by the Assistant Commissioner, Service Tax, Division Gwalior by his order dated 15/06/2017.
The appellant holds service tax registration and paying service tax under the categor

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

truction of Model School Building at Pahadgarh for PWD, PIU Division-4, Gwalior (Department of Government of Madhya Pradesh) work order No: 02/2012-13 dated 15.06.2012, E-tender No. 14209 and office No. 1601 dated 02.11.2012.
(vi) Construction of Boundary wall at National Law Institute University, a university established by State Legislature of Madhya Pradesh, Bhopal vide ref. no. by act No. 41 of 197, Letter Ref. No. 83/ NLIUB dated 23.01.2015.”
That prior to 01/04/2015, the appellant was availing exemption for civil works related to State and Union Government establishments used for administrative purpose. The exemption was availed under notification No. 12/2012 and 25/2012 dated 20/06/2016. As the notification dated 20/06/2012 was withdrawn w.e.f. 01/04/2015, the exemption from service tax on the nature of work the appellant engaged in was not available; therefore, he paid service tax with interest for the period 01/03/2015 to 30/09/2015.
The exemption was later on restored vid

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

llation, completion, fitting out, repair, maintenance, renovation or alteration of
(a) a civil structure or any other original works meant predominantly for use other than for commerce, industry or any other business or profession;
(b) a structure meant predominantly for use as
(i) an educational establishment;
(ii) a clinical establishment; or
(iii) an art or cultural establishment;
(c) a residential complex predominantly meant for self-use or for the use of their employees or other persons specified in Explanation 1 to clause (44) of section 65B of the said Act, under a contract entered into before the 1st day of March, 2015 and on which appropriate stamp duty, where applicable, had been paid before that date.
(2) Refund shall be made of all such service tax which has been collected but which would not have been so collected had sub-section (1) been in force at all material times.
(3) Notwithstanding anything contained in this Chapter, an application for the claim of

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

from time to time, shall apply, so far as may be, in relation to service tax as they apply in relation to a duty of excise : 9, 9A, 9AA, 9B, 9C, 9D, 9E, 11B, 11BB, 11C, 12, 12A, 12B, 12C, 12D, 10(12E, 14, 15, 31, 32, 32A to 32P (both inclusive), 33A, 34A,35EE,35F], 11 (35FF) to 35O (both inclusive}, 35Q, 12[35R,] 36, 36A, 37A, 37B, 7C, 37D 13[38A] and 40″.
Accordingly, the Word(S) 'duty of excise' or 'duty', shall mean 'Service Tax', the word 'manufacture' shall mean 'Service Provider', the word 'buyer' shall mean 'Service receiver'. (Except Under Section 12 B) and 'goods', shall mean 'Service' whenever they appear Under the Section of Central Excise Act, 1944 and circular/ Clarification, issued in this regard, which will be quoted referred or discussed in this Show Cause Notice.
Further, the word 'Act' appearing in Section 12B of the Central Excise Act, 1944 shall mean 'Finance Act, 1944', and

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

he Central Excise Act, 1944 provides that if the Assistant Commissioner or Deputy Commissioner of Central Excise is satisfied that the whole or any part of the duty paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the 'Consumer Welfare Fund' except is excipiendis. However Sub Section (f) of the Section 11B provides that if the duty of excise borne by the buyer and if he had not passed on the incidence of such duty to any other person then the amount shall be paid to such buyer.
Explanation annexed to Section 11B defined the 'relevant date' for the purpose of reckoning time period within which refund claim is to be filed. This date is the date of purchase of 'goods' in the case of claimed is other than the 'manufacture'.
3. And whereas the refund claim was received on 24.03.2017 therefore the service tax and interest deposited during the period of 01/03/2015 to 30/09/2015 through c

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

tored the exemption granted under Notification No.25/2012 ST dated 20.06.2012 as amended by Notification No.9/2016-ST 01.03.2016 for the services provided under a contract which had been entered into prior to 01.03.2015 and on which appropriate stamp duty, where applicable had been paid prior to that date. The services provided during the period from 01.04.2015 to 29.02.2016 under such contracts are also exempted from service tax, even if service is provided after 01.04.2015. If service tax was paid, refund has to be granted. The noticee has complied all the terms and conditions as stipulated in the Notification. Noticee has paid the service tax on the aforesaid tender/ work order and because of withdrawn of exemption by the government w.e.f. 01.03.2015 there was delay in payment of service tax and the noticee has paid the interest of Rs. 57716/- and has applied for refund of the said amount of service tax with interest. And that the notification for restoration of exemption was issued

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

the appellant, the department has no authority to withhold the same on the ground of limitation. It was stated that the provisions of Section 11B of 1944 Act would get attracted when there is a liability and excess duty/ tax is deposited and later on the refund of such excess amount is sought. It was stated that being exempted, the appellant was not liable to pay the service tax. Therefore, the amount received by the department was not towards the tax as would be governed by the provisions of Section 11B. It was urged that even if it is then the period of limitation prescribed being one year and since notification for restoration of exemption was issued on 01/03/2016 and the appellant had filed the refund claim on 24/03/2017, the same should have been allowed.
The appeal was, however, dismissed on 28/09/2017 by Commissioner (Appeals), on the findings:-
“7. To put the legal position in proper prospective, I may mention that initially the mega exemption notification No. 25/2012-ST gra

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ays inclusive), in respect of taxable services provided to the Government, a local authority or a Governmental authority, by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation or alteration of
(a) a civil structure or any other original works meant predominantly for use other than for commerce, industry or any other business or profession;
(b) a structure meant predominantly for use as
(i) an educational establishment;
(ii) a clinical establishment; or
(iii) an art or cultural establishment;
(c) a residential complex predominantly meant for self-use or for the use of their employees or other persons specified in Explanation 1 to clause (44) of section 65B of the said Act, under a contract entered into before the 1st day of March, 2015 and on which appropriate stamp duty, where applicable, had been paid before that date.
(2) Refund shall be made of all such service tax which has been collected but which woul

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

to some how claim the refund from the department they have arbitrarily calculated the time limitation of one year from the month of issuance of the said notification. They have also deliberately avoided any mention of section 102 inserted vide Finance Act 2016 which would have exposed and undetermined their refund claim as the same was clearly time barred.”
On further appeal, the Tribunal vide impugned order affirmed the order rejecting refund claim. The Tribunal taking into consideration the stipulations contained under Section 102 of the Finance Bill 2016 prescribed specific period of limitation of six months from the date of the assent of the President (which being 14.05.2016) for refund. And that the appellant applied for refund on 24/03/2017, i.e., with a delay of 131 days, dismissed the appeal observing:-
“8. Having carefully heard the submissions of both the sides, I find that there is no dispute on the facts. The retrospective exemption having been granted by the legislativ

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

before the Revenue authorities.”
The appellant has proposed the following substantial questions of law:-
“(A) Whether on facts and in the circumstances of the case and in law, an amount paid under the mistaken belief that the service is liable to service tax when the same is actually exempt, be considered as service tax paid?
(B) Whether on facts and in the circumstances of the case and in law, the Tribunal was justified in rejecting appellant's refund claim as time barred without appreciating the fact that delay in filing the refund claim was beyond the control of the appellant inasmuch as the construction service covered in the refund claim is actually exempt of service tax was itself disputed by the authorities as the same was under investigation?
(C) Whether service tax paid mistakenly under construction service although actually exempt, is payment made without authority of law?”
As regard to substantial questions of law as proposed at 'A', we are not commended

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

it was prospective in effect, the appellant was not entitled for any exemption, which the appellant was aware of and with open mind and eyes deposited the service tax due with interest. It was only by virtue of subsequent legislation the notification was made effective from retrospective date with the stipulations that refund can be claimed within specific time provided. There was thus no ambiguity nor any dispute as would have prevented the appellant from seeking refund within the period of limitation. On these given facts the substantial question at 'B' also does not arise for consideration.
As regard to substantial question 'C', the contention that the service tax was paid mistakenly is also not borne out from the facts.
The decisions relied upon by the appellant in Commr. Of C.Ex. (Appeals), Bangalore Vs. KVR Construction [Writ Appeal No. 2992-2993 of 2009 (Karnataka High Court)], CC&ST Vs. H.K. Dave Ltd. [(2015) 38 STR 77], Wazir Singh Swaran Singh Consignment S

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

M/s. Diaspark Infotech Pvt. Ltd. Versus CGST, CE & CC, Indore
Service Tax
2019 (1) TMI 1241 – CESTAT NEW DELHI – TMI
CESTAT NEW DELHI – AT
Dated:- 14-1-2019
Service Tax Appeal No. ST/51520/2018-ST [SM] – FINAL ORDER NO. 50067/2019
Service Tax
MRS. RACHNA GUPTA, MEMBER (JUDICIAL)
Present for the Appellant: Mr. Manish Saharan, Advocates
Present for the Respondent: Mr. P.R. Gupta, D.R.
ORDER
PER: RACHNA GUPTA
Present appeal has been directed against order in appeal No. IND-EXCUS-000-APP-756-17-18 dated 26.03.2018 passed by the Commissioner (Appeals), CGST & Central Excise, Indore.
2. The facts relevant for the adjudication are that the appellant provides an output service, which was exported without payment of service tax. Since they were entitled for availing cenvat credit that the appellant vide a refund claim for Rs. 6,43,603/- vide their application dated 29.12.2016. However, vide show cause notice No.2574 dated 28.04.2017 the rejection of the said refun

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

e at the end of quarter for which refund claim is being made or at the time of filing of the refund claim, whichever is less. It is submitted that though inadvertently in the impugned ST-3, the balance was shown 'Nil'. But it was highly inappropriate on the part of the adjudicating authorities below to ignore the relevant documents as were submitted by the appellant to show the existing balance in accordance whereof the impugned refund was filed. Ld. Counsel has impressed upon that while replying the show cause notice itself, a Certificate from the Chartered Accountant certifying the claim of accumulated cenvat credit of Rs. 6,43,606/- was furnished. Alongwith the said certificate all the requisite declarations and documents as that of invoices were also submitted still the authority below has emphasized merely on ST-3 returns despite the fact that request for submitting for the correct returns was placed before the Range Superintendent rather twice which were not considered. Ld. Couns

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

only within a period of 90 days that too electronically. None, admittedly, was the case of the appellant. The impugned modification was proposed after a gap of 8 months. The Commission (Appeals) has rightly adjudicated the controversy in the given circumstances. Appeal is accordingly, prayed to be dismissed.
6. After hearing both the parties and perusing the entire record, I find that it is an admitted fact that the appellant is providing an output service, which was exported but appellant was entitled to credit, due to which, the impugned refund was filed by the appellant. I also find that the adjudicating authority below have rejected the refund claim holding that one of the conditions of Notification No.27/2012 has not been complied upon. The said condition No. (g) is one among various conditions (a) to (i) as provided in the Notification and it reads as under:-
(g) the amount of refund claimed shall not be more than the amount lying in the balance at the end of quarter for which

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

r the impugned period is showing 'Nil' balance, had requested the Department vide their letter dated 28.12.2016 and subsequently vide letter dated 16.01.2017 to permit the submission of revised ST-3 return for the impugned period so as to rectify the mistake of cenvat credit figures, but the same has been denied by the Department. Though reliance upon rule 7 B of Service Tax Rules has been placed. According to which a revised ST- 3 return can be filed by an assessee within a period of 90 days and the said rule is taken as a ground to reject the request of the assessee/appellant to submit the revised ST-3 return, but I am of the opinion that Rule 7 B will have no substantive implication in a case where the assessee has cogent documentary evidence to support that the proposed revision of ST-3 is utmost important. In the present case, the ST -3 is showing nil balance, whereas the voluminous documents of the appellant are showing the balance of Rs. 6,43,603/- lying in the account for the i

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

e of procedure is altered, he has no other right than to proceed according to the altered mode. A procedural law should not ordinarily be construed as mandatory, the procedural law is always subservient to and is in aid to justice. Any interpretation which eludes or frustrates the recipient of justice is not to be followed.”
9. In another decision in the case of Salem Advocate Bar Assn. v. Union of India reported in 2005 (6) SCC 344 the Hon'ble Apex Court has considered the question as to whether the Court has any power or jurisdiction to extend the period beyond 90 days. It was held as follows:-
“It has been common practice for the parties to take long adjournments for filing written statements. The legislature with a view to curb this practice and to avoid unnecessary delay and adjournments, has provided for the maximum period. The mandatory or directory of such provision shall have to be determined by having regard to the object sought to be achieved by the amendment. It is, thus

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

as follows:-
“In view of the provision of Rule 7C of the Rules, the revised return cannot be ignored simply on the ground that the same has been filed after a period provided under Rule 7B of the Rules. In these circumstances, we find that the matter requires re-consideration by the adjudicating authority in view of the provision of Rule 7C of the Rules. The impugned order is set aside, after waiving pre-deposit of the amount of service tax, interest and penalty and the matter is remanded to the adjudicating authority to decide the issue afresh after offering an opportunity of hearing to the appellant. The appeal is allowed by way of remand.”
12. This Tribunal in the case of Serco Global Services Pvt. Ltd. vs. Commissioner of Central Excise, Delhi-III reported in 2015 – TIOL – 1044-CESTAT-Del. has held that even if ST-3 return for a particular period do not show any unutilized balance of cenvat credit, the refund still is to be granted on the basis of cenvat credit available in cenv

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

M/s. POPULAR VEHICLES AND SERVICES LIMITED Versus UNION OF INDIA, GOODS AND SERVICE TAX NETWORK (GSTN), GOODS AND SERVICE TAX COUNCIL, THE DEPUTY COMMISSIONER, THE NODAL OFFICER FOR STATE GST AND THE COMMISSIONER, DEPARTMENT OF KERALA STATE GOODS AND SERVICE TAX
GST
2019 (1) TMI 1079 – KERALA HIGH COURT – 2019 (22) G. S. T. L. 183 (Ker.)
KERALA HIGH COURT – HC
Dated:- 14-1-2019
WP(C). No. 609 of 2019
GST
Mr. Justice A. Muhamed Mustaque
For the Petitioner : Sri. Sukumar Nainan Oommen, Shri. Jonathan Preetham Paul, Smt. Karthika S. Varma, Sri. Rahul Ipe Prasad And Sri. Sherry Samuel Oommen
For the Respondent : By Sri. Dinesh R.Shenoy, CGC, By Government Pleader, Smt. Thushara James
JUDGMENT
The petitioner approached

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

M/s. Indroyal Furniture Co. Pvt. Ltd., Shri Madhusoodanan Versus Commissioner of GST & Central Excise, Tirunelveli
Central Excise
2019 (1) TMI 770 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 14-1-2019
Appeal Nos. E/342 & 343/2010 – Final Order No. 40059-40060/2019
Central Excise
Ms. Sulekha Beevi C.S., Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical)
Shri M. Karthikeyan, Advocate for the Appellant
Shri B. Balamurugan, AC (AR) for the Respondent
ORDER
Per Bench
The appellants are manufacturers of furniture and are holding central excise registration issued by the Tenkasi range, Tirunelveli Commissionerate. Upon gathering specific intelligence that appellants were indulging in suppression of production and clandestine removal of excise goods simultaneous search operations were conducted on 11.9.2007 at various places including the factory premises, head office as well as sales outlets and residential premises of directors and manage

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

keyan appeared and argued the matter. He submitted that the evidence relied upon by the department is the statements recorded during investigation. Though computer documents were recovered at the time of search, the procedure prescribed under Section 36B of Central Excise Act, 1944 was not complied by the department and the Commissioner himself after analyzing the provision has held that data retrieved from the computer cannot be admitted in evidence.
2.1 Entire demand of duty has been made based only on the computer print outs retrieved during investigation. The requirements of the Section 36B which are to be complied with for the purpose of relying on such Computer printouts have not been satisfied in this case. The Commissioner in Para 72 of the impugned order has categorically held that the conditions prescribed under the above Section has not been complied with and hence the computer print outs cannot be of evidentiary value.
2.2 Statements were recorded from various persons and

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

and they had purchased furniture's from the appellant only under the cover of invoices. The following decisions are relied upon in support of their contention based on Section 9D.
a) Jindal Drugs Pvt. Ltd Vs. Union of India, reported in 2016 (340) E.L.T. 67 (P & H).
b) Shiv Shakthi Earthmovers – 2018-TIOL-258-Ces-Chd
c) Ambica International Vs. UOI – 2016 TIOL 1238 HC P&H
d) Vijayachamundeswari Textiles – CESTAT, Chennai, Final Order No.42823-42825/2017 dated 26.07.2017
2.3 Other documentary evidences such as personal diary maintained by Shri Sashangan, Loading List, etc. also does not establish the serious charge of clandestine manufacture and sale of certain furniture for cash alone can be made out from it. From the balance sheet of the appellant which is available for all the three years in dispute, it is very clear that the appellant is engaged in trading of furniture also and such sales on cash basis have been wrongly reckoned as sale of manufactured items without payment of

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ntire demand of duty with consequential interest and penalties (both on the appellant and the co-appellant) may be set aside with consequential relief.
3. The ld. AR Shri B. Balamurugan supported the findings in the impugned order. He adverted to para 72 of the impugned order and submitted that though the Commissioner has recorded that it would be difficult to admit the computer print outs as evidence, the statement recorded would support the computer print outs and therefore the computer print outs are not stand alone document. The print outs have been corroborated by the statements. Thus computer print outs are reliable and acceptable in evidence. Other documents viz. diary, loading list and material inward register were also recovered. These showed that appellants had purchased unaccounted wood which was used for manufacture of furniture which was cleared clandestinely. All these facts are admitted in the statements of the employees. Shri V. Arun, who is the accountant of the appel

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

e details contained in the print outs which is Annexure 20 and relevant for the year 2005 – 06 which is the basis for quantification of demand for such year. So also V.G. Sashankan who is the Manager (Stores & Dispatch) has stated that he has maintained two private diaries for cash receipts and payments. It is deposed by him that the signature of the receipt of the amount is that of Shri V. Arun, Accountant. Thus, the statements of these two employees would support the computer print outs. The allegation of clandestine removal is forcefully established by the department. The demand, interest and the penalties imposed therefore require no interference.
4. Heard both sides.
5. The allegation is that the appellant has clandestinely manufactured and cleared furniture and thus evaded excise duty.
5.1 The main evidence relied by the department is the data / computer print outs retrieved from the computers which was used in head office / factory etc. These computers were seized from the pr

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

(c) a statement contained in a document and included in a printed material produced by a computer (hereinafter referred to as a “computer print out”), if the conditions mentioned in sub-section (2) and the other provisions contained in this section are satisfied in relation to the statement and the computer in question, shall be deemed to be also a document for the purposes of this Act and the rules made thereunder and shall be admissible in any proceedings thereunder, without further proof or production of the original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible.
(2) The conditions referred to in sub-section (1) in respect of a computer print out shall be the following, namely :-
(a) the computer print out containing the statement was produced by the computer during the period over which the computer was used regularly to store or process information for the purposes of any activities regularly carried on

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

rly performed by computers, whether –
(a) by a combination of computers operating over that period; or
(b) by different computers operating in succession over that period; or
(c) by different combinations of computers operating in succession over that period; or
(d) in any other manner involving the successive operation over that period, in whatever order, of one or more computers and one or more combinations of computers, all the computers used for that purpose during that period shall be treated for the purposes of this section as constituting a single computer; and references in this section to a computer shall be construed accordingly.
(4) In any proceedings under this Act and the rules made thereunder where it is desired to give a statement in evidence by virtue of this section, a certificate doing any of the following things, that is to say, –
(a) identifying the document containing the statement and describing the manner in which it was produced;
(b) giving such particul

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

any official, information is supplied with a view to its being stored or processed for the purposes of those activities by a computer operated otherwise than in the course of those activities, that information, if duly supplied to that computer, shall be taken to be supplied to it in the course of those activities;
(c) a document shall be taken to have been produced by a computer whether it was produced by it directly or (with or without human intervention) by means of any appropriate equipment.
Explanation. – For the purposes of this section, –
(a) “computer” means any device that receives, stores and processes data, applying stipulated processes to the information and supplying results of these processes; and
(b) any reference to information being derived from other information shall be a reference to its being derived therefrom by calculation, comparison or any other process.”
5.3 The mahazars dated 11.9.2007 and 17.9.2007 prepared at the appellant premises and office of DGCEI

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

quantification of duty has been based on the print outs from the computers seized as per mahazar from factory and Head office. Then it becomes highly necessary on the part of department to establish that the provisions of Section 36B has been complied.
5.4 In para 72 of the impugned order, the Commissioner has addressed this issue of the requirement to comply with the provisions of Section 36B of the Act ibid and has observed as under:-
“In this case, it is apparent that the data contained in the computer was fed by Shri Arun from March 2006 and earlier two employees, who were no more in service maintained the computers. No statements were recorded from the said employees concerning the data and the computer print outs. Even the statement dated 27.9.2007 recorded from Shri Arun was silent as to whether the conditions stipulated in sub-section (2) as said above were complied with. In the absence of the conditions being complied with it would be difficult to admit the computer print o

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

did not appear for cross-examination. Though it is alleged that V. Arun was maintaining the accounts, his statement or certificate as to feeding of the data in the computer has not been obtained by the department. It is brought out that the witnesses namely Shri V.G. Sashankan, Shri Ashok Kumar and Shri V. Vasant Selvaraj whose cross-examination was conducted have retracted from their depositions. These are the persons alleged to have signed the computer print outs when it was taken out by the DGCEI at their office. So also the buyers from whom statements were recorded and relied upon by the department have filed affidavit wherein they have deposed that they had no knowledge of the computer ledger extracts shown to them and they were forced to give statements before the investigation officers. Thus, they have disowned their entire depositions made during the investigations. From the above discussions, we find that the statements cannot be considered as standalone documents to prove th

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

commission
Query (Issue) Started By: – Madhavan iyengar Dated:- 13-1-2019 Last Reply Date:- 17-1-2019 Goods and Services Tax – GST
Got 6 Replies
GST
X based in Maharahstra India has a GST regn X helps in procurement of orders for its overseas clients based in US and Germany X receives commission from the clients in US and Germany for the procurement of orders. Thus X is acting as intermediary and accordingly based on POPS the location is Maharashtra state.
In the above case X will raise invoice fro commission on the overseas clienst ,
Issues: X should discharge which tax IGST or CGST/SGST and can it treat the amount of commission received as inclusive or it has to calculate the tax on the amount received. ??
Reply By KASTURI SETHI:
The Reply:
Dear Querist,
1.IGST
2. Why the question of cum tax ? Will X receive tax from foreign client ? Is tax already included in the amount of commission ? Is there such agreement to this extent ? Pl. clarify.
Reply By SHARAD ANADA:

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

services where the location of supplier of services or location of recipient of services is outside India.
Now, we are discussing whether intermediary services is Inter-State or Intra-State where the location of supplier or location of recipient is outside India as there is ambiguity on the same.
Considering the supplier is located in Maharashtra, the place of supply would also be Maharashtra as per Section 13(8) of IGST Act.
In the present transaction, the place of supply and location of supplier are in the same state. One may argue that this transaction would qualify to be as an Intra-State supply as per Section 8(2) of IGST Act. If we carefully see, lawmakers have used the words “subject to provisions of section 12” in Section 8 of IGST Act. The literal meaning of the term 'subject to' is 'dependent upon'. Thus, when a provision is made subject to another provision, the former cannot override the later. Let us look at the legal implications of the words 'subject to proviisons of'

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

it is necessary to fulfil the condition of section 12 to fall in Section 8(2) of IGST Act. Thus, it is wrong to term intermediary services as an Intra-State supply of services in case where the location of supplier or location of recipient is outside India. This is for the reason that Section 12 is applicable only to determine place of supply where the location of supplier and location of recipient is in India and not covers the cases where the location of supplier or location of recipient is outside India.
Therefore, in this view, it shall qualify to be in the course of inter-state trade or commerce on the lines of Section 7(5)(c) as the same is a residuary entry to cover all cases not covered elsewhere.
The statutory text of section 7(5)(c) is reproduced as follows-:
Supply of goods or services or both-
a) When the supplier is located in India and the place of supply is outside India.
b) To or by a Special Economic Zone developer or a Special Economic Zone unit: or
c) In the

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

amount received has to be treated as inclusive and the formula to be applied and tax portion arrived at
Reply By Mahadev R:
The Reply:
Following is one of the 65 FAQ released on banking service. In this it is clarified that it is subject to CGST + SGST. There is a divergent view on this. Payment of CGST + SGST could be safer option.
Q.25 Would intermediary services provided to an offshore client and services provided by a banking company to its offshore account holders be treated as an intra-State supply or an inter-State supply for payment of GST?
Ans: Under clause (b) of section 13(8) of the IGST Act, 2017 the place of supply of such services is the location of the provider of services. As the location of supplier and place of supply are in same State, such supplies will be treated as intra-State supply and Central tax and State tax or Union territory tax, as the case may be, will be payable.
Reply By KASTURI SETHI:
The Reply:
Dear Sh.Mahadev R. Ji,
FAQ mentioned by you spec

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Commercial Vehicle given on hire for transportation of goods
Query (Issue) Started By: – Kaustubh Karandikar Dated:- 12-1-2019 Last Reply Date:- 9-1-2020 Goods and Services Tax – GST
Got 12 Replies
GST
XYZ (Manufacturer) have a commercial vehicle for transportation of goods and wants to provide the vehicle on hire to PQR(Manufacturer) for the transportation of Goods and for which there will be a monthly billing on the basis of number of trips and locations where the goods have been transported. Both are in the same state.
1) What will be Rate of GST to be charged on the Invoice by XYZ to PQR? And
2) The nature of Service (Whether this can be treated as GTA service or not?).
Reply By KASTURI SETHI:
The Reply:
Dear Sir,
Query-wise reply is as under:-
1. HSN 996601. Hiring truck exempted vide Notification No.12/17-CT(Rate) dated 28.6.17 as amended vide Notification No. 2/18-CT(Rate) dated 25.1.18.
2. It cannot be treated as GTA.
Reply By Kaustubh Karandikar:
The Reply

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

on hire –
(a) to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers; or
Nil
Nil
(b) to a goods transport agency, a means of transportation of goods.
Notification No.9/17-IT(R) dated 20.6.17
23
Heading 9966 or Heading 9973
Services by way of giving on hire –
(a) to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers; or
(b) to a goods transport agency, a means of transportation of goods.
Nil
Nil
Notification No.8/17-IT(Rate) dated 20.6.17 (Serial No.10) does not contain the word,"Hiring". So it is not relevant. You are talking of hiring and not renting.
Reply By MSM ASSOCIATES:
The Reply:
Mr. Kasturi Shethi, w.r.t above query i have a further doubt :-
Since the term "Hire" is not defined under GST act, what shall be the meaning of "Hire basis"?
Case 1) ABC Ltd gives on hire to XYZ Ltd, 10 trucks on a fixed hire Charges of ₹ 50000 per truck per month for t

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Vehicle ? Even then I am expressing views as under :
1. Difference between 'Hiring' and 'Renting.
As per the Law Lexicon, the Encyclopaedic Law Dictionary, when A person gives motor vehicle to B person, A is providing renting service of motor vehicle (may be car, truck, van, metadoor, tipper etc.) and B is hiring that motor vehicle from A. .
2. Exemption on 'hiring basis' of vehicle meant for transportation of goods is available to GTA only,. if truck is supplied to GTA only. It is clearly mentioned at serial no. 22 of Notification no. 12/17-CT(R) dated 28.6.17 as amended. (extract of notification already given above. If truck is supplied to the person other than GTA, no exemption is available. In that situation, the activity of hiring and renting both are covered under the category of 'Renting of Motor Vehicle' e.g. we hire cab (Uber Co.) and Uber Co. provides renting service.
3. In the cases No.1 and 2 mentioned by you, if XYZ Ltd. is registered under

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

effective control is the person who has rented the truck.
This are my views,
Thanks
Reply By KASTURI SETHI:
The Reply:
Yes. This is also an other aspect opined by Sh.Alkesh Jani Ji.
Reply By KASTURI SETHI:
The Reply:
The category of "Right to use of tangible goods services" does not include trucks (means of transportation of goods by road). It includes machinery, equipments, excavators, cranes, wheel loaders etc..See HSN 9973
Reply By Alkesh Jani:
The Reply:
Dear Shri Kasturiji Sir,
I was trying to simplify the term "Hiring" and "Renting", where effective control or right to enjoy without transferring the title.
Further, In GST "Goods" has been defined at Section 2(52) of CGST Act,2017 and is reproduced below for ready reference
"(52) “goods” means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed t

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

renting of machinery, equipments etc. only. It does not talk of hiring of motor vehicles.
What I want to say is that hiring of truck by GTA from an other person is exempted. Govt.does not want to burden GTA because GTA will pay tax. Hiring charges (without GST) will also form part of transportation charges/cost which will be recovered from the person who bears the freight (may be consignor or consignee). It is like the inclusion of cost of captively consumed goods in the manufacture of final product. (just for comparison) If truck is given to a person other than GTA, it will be considered under the category of "Renting of Motor Vehicles" and tax will be charged accordingly.
Now if we classify truck (means of transportation of goods) under the category of "Right to Use of Tangible Goods Services" without transfer of possession and effective control as opined by you, even then exemption will not be available. Motor Vehicle was not included in this category even

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

export fo services
Query (Issue) Started By: – Madhavan iyengar Dated:- 12-1-2019 Last Reply Date:- 20-1-2019 Goods and Services Tax – GST
Got 9 Replies
GST
A indian Company X in new delhi has received a contract for submission of a quality audit report, for one of the clients based in haryana india of an overseas company B located in US.
X will raise invoice in USD and receive money in foreign exchange
Whether the aforesaid services provided by X will fall under export of services as all conditions for export will be satisfied (but doubt on performance of services will it be held that POPS is in India ????)
Reply By PAWAN KUMAR:
The Reply:
As per my view, place of supply of service is in india which is different from the place of supplier, therefore it is qualify as inter-state supply and liable to IGST. Export of service is not qualify
all the conditions should satisfy for export of service :
-supplier of service is in india
-receiver of service is outside india

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

DVANCE RULING, MAHARASHTRA , to qualify a transaction of supply of service as export of services that transaction has to satisfy all five ingredients of the definition of export of services simultaneously. So in your situation the condition at (iii) of the above definition is not satisfied. Go through the whole decision carefully. It answers your query.
Reply By Madhavan iyengar:
The Reply:
sirs When we talk of gst as a destination based tax the taxes will follow the goods / services here the destination of the service is the recipient located abroad, suppose let us mirror the transaction in india then definitely the destination of the services is in india.
going a step further the foreign party which receives the quality audit report will based on the report decide to do business in india and then there will be imports of those goods into india
just because the performance of the service is in india the recipient will receive the quality audit report abroad and he is consuming the

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

gst the service provider is located in maharashtra and deputes his person to other state ie haryana and the service is completed and thereafter the person comes to Maharahstra base office and the report will be submitted
Further the invoice will be raised by the office in maharashtra in USD on foreign party since we cant collect the tax from foreign vendor can we arrive the amount inclusive of tax and then discharge the tax suppose we raise invoice for 100USD gross and then tax will be calculated in reverse way and discharged
Reply By Madhavan iyengar:
The Reply: Market research, survey for overseas group, parent entity, not 'intermediary service', constitutes 'export of service': AAR of Maharashtra
Fact: M/s. Asahi Kasei India Private Limited = 2019 (1) TMI 1091 – AUTHORITY FOR ADVANCE RULINGS MAHARASHTRA (“the applicant”) is a Indian subsidiary company of Asahi Kasei Corporation, Japan ("Asahi Japan"). Asahi Japan is the flagship company of the Asahi Kasei group. Asahi K

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

rvices provided by the applicant is an export of services as defined under Section 2(6) of the IGST Act 2017?
Held: The Hon'ble AAR of Maharashtra vide its Advance Ruling No. GST-ARA-35/2018-19/B-108 dated September 05, 2018 = 2019 (1) TMI 1091 – AUTHORITY FOR ADVANCE RULINGS MAHARASHTRA stated as follows:
1. (i) The services provided by the applicant in the nature of Research on the matter related to functioning of the holding of company such as – corporate accounting, corporate finance, corporate personnel and labour relations, corporate research and development, quality assurance and corporate intellectual property, and provide Party A with its report of the research thereon would fall under service code tariff 99859 as other support services nowhere elsewhere classified.
(ii) The services provided by the applicant in the nature of Information on Market in the territory which includes – Economic, industrial and technical information on the products falling under the category of t

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Non-reduction of MRP invokes Anti-profiteering law
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 12-1-2019

The National Anti-profiteering Authority (NAA) has held that non-reduction of prices (MRP) after GST rate reduction amounts to indulgence in profiteering so as to invoke section 171 of the CGST Act, 2017 on anti-profiteering measures.
In the matter of DGAP, CBIC, New Delhi v. JP & Sons, Delhi (2018) 12 TMI 472 (NAA), the NAA vide its Order dated 06.12.2018 has directed the business entity to reduce the prices of products by making commensurate reduction in prices vis-à-vis reduction in tax rates and pass on the benefit to buyers, besides depositing the amount so profiteered alongwith interest @ 18 percent to the Government exchequer. It also found the business entity guilty of issuing wrong invoices by not showing the correct basic prices and held it liable for offence committed under section 122(l)(i) of the CGST Act, 2017 for which penalt

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Gms.
87.67
18%
103.45
The business entity who was distributor of Johnson & Johnson Pvt. Ltd. (J & J) was supposed to sell the above goods on the base prices which were being charged by him before 15.11.2017 and levy GST so that the benefit of reduction in the rate of tax could be passed on to the customers.
Submissions by Distributor
On notice, it was contended by the business entity that :
* Billing software was being controlled by J & J and distributor could not do any changes / modification therein..
* GST rate was reduced but it took few days to make changes in the billing software.
* Price charged was not more than the MRP mentioned on products.
* Invoices taken as evidence were generated prior to updation of software by J & J.
* It was bound to use the J & J software only and its ownership rights etc were with company only.
* Base prices could be changed by the company only and not by distributor.
* It was bound to charge the increased prices as per the term

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

to Consumers
Upto
14.11.17
W.e.f
17.11.17
Upto
14.11.17
W.e.f
17.11.17
Upto
14.11.17
W.e.f
17.11.17
Base Price
74.76
79.74
80.82
86.21
93.75
100.00
Tax
20.93
14.35
22.63
15.52
26.25
18.00
Invoice Price
95.69
94.09
103.45
101.72
120.00
118.00
JB Shampoo (TBP) 100 ml. (In Rs.)
Particular
J&J to Distributor
Distributor to Retailer
Retailer to Consumers
Upto
14.11.17
W.e.f
17.11.17
Upto
14.11.17
W.e.f
17.11.17
Upto
14.11.17
W.e.f
17.11.17
Base Price
52.95
54.06
57.25
58.45
66.41
67.80
Tax
14.83
9.73
16.03
10.52
18.59
12.20
Invoice Price
67.78
63.79
73.28
68.97
85.00
80.00
DGAP Findings
The DGAP investigation revealed that by increasing the base prices of these products and having maintained the pre-GST rate reduction MRPs, the benefit of GST rate reduction was not passed on to the customers by the business entity. From the price list, it was observed that it had raised the base prices of both the produc

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

2 HSN codes out of which 134 products comprising of 14 HSN codes were affected by the reduction in the rate of GST from 28% to w.e.f. 15.11.2017.
In the case of 123 products, it was observed that the base prices of 121 products were increased after 15.11.2017 and in the case of 2 products, the base prices were reduced after 15.11.2017. Therefore, the DCAP concluded that in respect of the 130 products, supplied by the business entity during the period between 15.11.2017 to 31.03.2018, the amount of profiteering came to ₹ 5,01,646/- on account of increase in their base prices.
NAA Findings & Conclusion
The NAA observed that the Central Government vide Notification No. 41/2017- Central Tax (Rate) dated 14.11.2017 had reduced the rate of GST from 28% to in respect of the subject two products with effect from 15.11.2017, the benefit of which was required to be passed on to the recipients by the business entity as per the provisions of Section 171.
Based on documentary evidences,

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

0 products which it was selling. It cannot escape the legal obligation which was imposed upon it by the said Notification by shifting its accountability on the ground that it had no control over billing.
Moreover, it had also not produced any evidence to show that it had made any correspondence with J & J to inform that he was bound to reduce the prices due to reduction in the rate of tax and J & J should either not increase the base prices or compensate it for the benefit it was bound to pass on to his customers, 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.
Further, mere charging of the tax @ 18% after 15.11.2017 cannot be construed to have resulted in passing on of the benefit when the base prices had been deliberately increased.
It had increased the base prices illegally and also forced its customers to pay additional GST on the increased prices otherwis

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ering in terms of Section 171 with the following directions / orders:
* To reduce the prices of these products as per the provisions of Rule 133 (3) (a) of the CGST Rules, 2017 by making commensurate reduction in their prices keeping in view the reduction in the rate of tax so that the benefit is passed on to the recipients.
* To deposit the profiteered amount of ₹ 5,01,646/- along with the interest to be calculated @ 18% from the date when the amount was collected from customers till the said amount is deposited.
* Since the buyers were not identifiable, directed the DGAP to get the amount of profiteering of ₹ 5,01,646/- along with interest deposited from the business entity in the Consumer Welfare Fund of the Central and the concerned State Governments as per the provisions of Rule 133 (3) (c) of the CGST Rules, 2017.
* In case of non-deposition of this amount within 3 months, directed DGAP to initiate recovery as per the CGST Act.
* Since investigation in the i

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

GST ON HEALTHCARE SERVICES
By: – Ritesh Mehta
Goods and Services Tax – GST
Dated:- 12-1-2019

Good health and good sense are two of life's greatest blessings. However with the recent action of taxmen both of these seems to be in jeopardy. In a recent article in the leading national daily, it was brought to our notice that the hospitals are getting GST notices for implants and the details of medicines and implants supplied to IPD (hospital in patient care) were being sought from these hospitals. One wonders that when health care services are exempt, the intention of the taxmen to levy GST on medicines and implants used on patients would lead to a long drawn court battle. This article focuses on the taxability or otherwise of GST on healthcare services.
Exemptions notification on Health Care services under GST:
Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 has exempted health care services vide Sr. No. 74 which is reproduced as under:
Services by way of:

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ty, abnormality or pregnancy in any recognised system of medicines in India, or a place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases;
“authorised medical practitioner” means a medical practitioner registered with any of the councils of the recognised system of medicines established or recognised by law in India and includes a medical professional having the requisite qualification to practice in any recognised system of medicines in India as per any law for the time being in force;
Other Exemptions related to healthcare:
Sr. No. 46: Services by a veterinary clinic in relation to health care of animals or birds.
Sr. No. 73: Services provided by the cord blood banks by way of preservation of stem cells or any other service in relation to such preservation.
Sr. No. 74: Transportation of Patients in Ambulance
With these above exemption notification, it is clear that health care services are exempt fr

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

consultants/ technicians hired by the hospitals, whether employees or not, are healthcare services which are exempt.
2. Retention money: Hospitals charge the patients, say, ₹ 10000/- and pay to the consultants/ technicians only ₹ 7500/- and keep the balance for providing ancillary services which include nursing care, infrastructure facilities, paramedic care, emergency services, checking of temperature, weight, blood pressure etc. Will GST be applicable on such money retained by the hospitals?
Clarification: The entire amount charged by them from the patients including the retention money and the fee/payments made to the doctors etc., is towards the healthcare services provided by the hospitals to the patients and is exempt.
3. Health care services provided by the clinical establishments will include food supplied to the patients; but such food may be prepared by the canteens run by the hospitals or may be outsourced by the Hospitals from outdoor caterers. When outsource

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

business, one of which is a principal supply
In case of healthcare industry, healthcare Services will be the predominant element of this composite supply whereas medicines, implants and food supply are ancillary to it and does not in itself become principal supply.
The tax liability on a composite supply shall be rate of tax applicable on supply of principal supply. In case of health services, the principal supply i.e health services is liable to tax at Nil rate and hence Nil rate will be considered the rate of tax applicable on the composite supply of health care services and supply of implants and medicines to IPD.
SAIFEE HOSPITAL TRUST (MSTT – SA NO. 190 OF 2016)
In the erstwhile VAT era as well, the issue of taxability of medicine drugs, stents, and implants during the course of medical treatment under MVAT was argued before the Hon'ble Maharashtra Sales Tax Tribunal. The tribunal after discussing all the facets of sales, deemed sales, works contract, intention behind sale of

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

privilege for the hospitals that are dispensing medicine to outpatients. Therefore pharmacy run by hospital dispensing medicine to outpatient or by standers or others can be treated as individual supply of medicine and not covered under the ambit of health care services. Hence such supply of medicines and allied goods are taxable.
Ruling:- The supply of medicines and allied items provided by the hospital through the pharmacy to the in-patients is part of composite supply of health care treatment and hence not separately taxable. The supply of medicines and allied items provided by the hospital through the pharmacy to the out-patients is taxable.
Other taxable income of hospitals:
Though it is clear from above discussion that the health services are exempted vide exemption notification, there are multiple heads of income for a hospital which are liable to tax under GST. These may include income from renting of premises from canteen or pharmacy, sale of scrap, sale or disposal of a

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Sweet Shop-Cum-Restaurant With Takeaway Facilities
By: – CA Akash Phophalia
Goods and Services Tax – GST
Dated:- 12-1-2019

Introduction
Globalization has changed different aspects of the Indian society including food habits. In its swing, Food and Beverages (F&B) Industry has also changes the nature of its service cum supply. Nowadays, it is common to find Sweetshops cum restaurant cum takeaway facilities under one roof. In this article the author aims to throw light on the applicability of tax rate on the various kinds of supplies made by such shops under one roof on the basis of advancing ruling recently decided [2018 (19) GSTL 356 (AAR-GST) Before the Authority for Advance Ruling under GST, Uttarakhand, Re : Kundan Misthan Bhandar 2018 (11) TMI 1266 – APPELLATE AUTHORITY FOR ADVANCE RULING, UTTARAKHAND ].
Background
The assessee is running a shop where it sale and serve sweetmeats, namkeens, cold drinks and other edible items and also runs restaurant. The dilemma

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply;
(74) ”mixed supply” means two or more individual supplies of goods or services, or any combination thereof, made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply
(90) ”principal supply” means the supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary;
(102) ”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.
Mixed supply and Composite supply
The concept of mixed or composite supply has evolved from the con

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ry course of business, it shall be treated as provision of a single service which gives such bundle its essential character'
Under GST law, supplies which are bundled with two or more supplies of goods or services or combination of goods and services are classified, with distinct characteristics, as :
(i) Composite Supply
(ii) Mixed Supply
If we look at the definitions (supra), Composite supply is one where two or more goods or services or both are supplied together, in a natural bundle and in a normal course of business, provided one of which is a principal supply. However, principal supply will be that supply which is predominant over other supplies. This means that the goods and services are bundled owing to natural necessities. The composite supply is taxed at the rate applicable to the principal supply whereas a Mixed supply means two or more individual supplies of goods or services, or any combination thereof, made in conjunction with each other by a taxable person for a sing

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ices from the restaurant is a principle supply which provides a bundled supply of preparation & sale of food, and serving the same and therefore it constitutes a composite supply. It further satisfied the following conditions of a composite supply:
(i) Supply of two or more goods or services or both together
(ii) Goods or services or both are usually provided together in the normal course of business.
In the instant case the nature of restaurant services is such that it may be treated as the main supply and the other supplies combined with such main supply are in the nature of incidental or ancillary services. Thus restaurant services get the character of predominant supply over other supplies. Therefore in the present case the supply shall be treated as supply of service and the sweet shop shall be treated as extension of the restaurant in as much as the said activity covered under Schedule II of the Act ibid and the relevant portion of the same read as under:
6. Composite su

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

ided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the premises where such food or any other article for human consumption or drink is supplied, other than those located in the premises of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff of any unit of accommodation of seven thousand five hundred rupees and above per unit per day or equivalent.
Explanation. -“declared tariff' includes charges for all amenities provided in the unit of accommodation (given on rent for stay) like furniture, air conditioner, refrigerators or any other amenities, but without excluding any discount offered on the published charges for such unit
Provided that credit of input tax charged on goods and services used in supplying the service has not been taken.
Conclusion
Thus, in view of the above discussion, the classification of supply shall be of restaurant services and

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Taxpayer's IGST Refund Rejection Overturned; Revenue Authority to Reassess After Ignoring Response to Deficiency Memo.
Case-Laws
GST
Refund of integrated tax (IGST) – rejection of application

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

GST Refund in case of Service Export
Query (Issue) Started By: – DEEPAK J Dated:- 11-1-2019 Last Reply Date:- 17-2-2019 Goods and Services Tax – GST
Got 3 Replies
GST
Hello,
We are into business of services providing in India and outside India. We have taken input credit of ₹ 50 Lacs from Service Tax to GST by Tran 1. As we have less supply of services in india, Service Tax input which is taken in GST and GST input from july 2017 to present is accumulated in our gst credit account.
1) Can we claim refund of Service Tax Input which is taken GST by Tran 1 amount of ₹ 90 Lacs?
2) As per GST law, it says file refund with IFRC/BRC no in case of export of service of accumulation of ITC. Can we file with transaction adv

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

o be calculated using the formulae given in the said sub-rules. The formulae use the phrase 'Net ITC' and defines the same as “input tax credit availed on inputs and input services during the relevant period other than the input tax credit availed for which refund is claimed under sub-rules (4A) or (4B) or both”. It is clarified that as the transitional credit pertains to duties and taxes paid under the existing laws viz., under Central Excise Act, 1944 and Chapter V of the Finance Act, 1994, the same cannot be said to have been availed during the relevant period and thus, cannot be treated as part of 'Net ITC'.
Reply By KASTURI SETHI:
The Reply:
Query-wise reply is as under:
1. I am of the view that you must file two refund claims. One

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Advance Authorization
Query (Issue) Started By: – Kaustubh Karandikar Dated:- 11-1-2019 Last Reply Date:- 28-1-2019 Goods and Services Tax – GST
Got 11 Replies
GST
Vide Notification No. RE 53 under Foreign Trade Policy (Ministry of Commerce), restriction of exemption on IGST for Import under Advance Authorization only if it is imported First Is removed.
1) Does this mean that there is exemption even if you Export first and Import later?
2) If that is correct, can we Export first paying IGST and claim refund of IGST paid and later Import under Advance Authorization without payment of IGST? Is this Permissible?
Reply By KASTURI SETHI:
The Reply:
Dear Sir, . Query wise reply is as under :-. 1. Yes. 2.Yes.
Reply By Kaustubh Karandikar:
The Reply:
Respected Sethi Ji
Thanks for your valuable advice. your answer to my Query No. 2, In my view, the notification does not say that the provision applies only if goods were exported without payment of IGST. Hence what you say see

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

oncerned authorities for deletion of the pre-import condition. Taking cognizance of the representations of the council/trade, the O/o Directorate General of Foreign Trade, New Delhi has issued Notification No 53/2015-20 dated 10/01/2019 regarding Amendment in Para 4.14 and 4.16 (ii) of the Foreign Trade Policy 2015-20 .
As an effect of this notification, Para 4.14 of FTP 2015-20 is amended to remove pre-import condition to avail exemption from Integrated Tax and Compensation Cess and exemption from Integrated Tax and Compensation Cess is also extended to deemed supplies. For further details, please refer DGFT Notification No. 53 Dt. 10.01.2019 as attached herewith.
Further, the Department Of Revenue, Ministry Of Finance has also issued its corresponding Notification No.01/2019 Dt. 10.01.2019 Seeking to remove pre-import condition and include specified deemed export supplies for exemption from integrated tax and Compensation cess for materials imported against Advance Authorizations a

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

Board of Indirect Taxes and Customs (CBIC) had issued a notification removing pre-import conditions and included specified deemed export supplies for exemption from integrated tax and Compensation cess for materials imported against Advance Authorization and Advance Authorizations for Annual Requirement. As per the Notification issued in 2015, Advance Authorization and/or materials imported there under will be with actual user condition. It will not be transferable even after completion of export obligation. However, Authorization holder will have the option to dispose of product manufactured out of duty-free inputs once export obligation is completed. In case where CENVAT credit facility on inputs have been availed for the exported goods, even after completion of export obligation, the goods imported against Advance Authorization shall be utilized only in the manufacture of dutiable goods whether within the same factory or outside (by a supporting manufacturer), for which the authori

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

materials in his factory or in the factory of his supporting manufacturer for the manufacture and supply of taxable goods (other than nil rated or fully exempt supplies) and to submit a certificate from a chartered accountant within six months from the date of clearance of the said materials, that the imported materials have been so used.” This is subject to a condition that if the importer pays integrated tax and the goods and services tax compensation cess leviable on the imported materials under sub-section (7) and sub-section (9) respectively of section 3 of the said Customs Tariff Act on the imported materials but for the exemption contained herein, then such imported materials may be cleared without furnishing a bond specified in this condition.
Reply By CAHemanth Kumar B:
The Reply:
Dear Members,
This amendment would be of prospective in nature as it does not specify retrospectively. Therefore from 13.10.2017 to 10.01.2019, pre-import, physical export conditions would apply a

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

RECENT ADVANCE RULINGS IN GST (PART-11)
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 11-1-2019

Advance rulings are important in any tax law as it provides a forum for clarification and possible interpretation of statutory provisions. Moreover, it conveys the legislative intention from the revenue's view point. Provisions of advance ruling are contained in section 95 to 106 of CGST Act, 2017 and State / UT GST enactment. Rules 103 to 107 of also provide for forms, manner, certification etc.
The Authority for Advance Rulings (AAR) have been set up in all the states and we have now over 300 advance rulings on different issues already pronounced by various State Authorities. The appellate mechanism for filing appeals against AAR rulings is also in place and we have about twenty five such appellate orders confirming or modifying the AAR orders. One major issue presently being faced is about multiple authorities (equal to number of States), each pronouncing

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

hority which is receiving services from IIT, Mumbai which falls under the definition of Government in terms of Section 2(53) of the Central Goods and Services Tax Act, 2017 wherein “Government” means the Central Government.
The Authority for Advance Ruling ruled that the Serial No. B of Part 3 of GST Tariff-Services [Chapter 99] provides the list of nil rated/fully exempted services, on going through the said list, we find that Government/Authority providing services to other Government/Authority is exempted from GST and in view of the above, the services received by the applicant from IIT, Mumbai is exempted from GST. [In Re: IT Development Agency (ITDA) (2018) 6 TMI 1126; ].
Advance Ruling on composite / mixed supply of goods or services
The applicant was engaged in business of fabrication of bus bodies/supply of bus bodies mounting/fitting on chassis supplied by various dealers/customers. The bus bodies were constructed and fitted under a written contract as per the specification

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

customers.
Thus, it emerged that the customer is providing only the chassis. All inputs/materials required for fabrication of bus body, had to be used by the applicant from its own account. Under such situation it is the bus body which is being fabricated and also being mounted on the chassis provided by the customer. Therefore, it is not merely job-work. Rather it is supply of bus body and an activity of fitting/mounting of bus body on chassis is an ancillary activity to the principal activity of supply of bus-body. Hence, in terms of the clarification issued by the CBEC vide Circular No. 34/8/2018-GST, dated 3-3-2018, the impugned activity is a composite supply, with principal supply being supply of bus body.
The Authority for Advance Ruling ruled that the activity of fabrication and fitting and mounting of bus bodies on the chassis supplied by the other party is a composite supply with supply of goods, i.e., bus bodies, being principal supply and same is covered under HSN Code 87

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

en referred and it is submitted that the job work means undertaking any treatment or process by a person on goods belonging to another registered taxable person; that the person who is treating or processing the goods belonging to other person is called 'job worker' and the person to whom the goods belong is called 'principal'. Further, the computation of Job Work Charges has been described at clause 6 of the agreement entered into between the assesee and M/s. Essar.
The job work charges agreed by the assessee and M/s. Essar is the sole consideration payable by M/s. Essar to the applicant for the agreed activity to be carried out by the applicant. Thus, the Authority for Advance Ruling ruled that the activity undertaken by the assessee falls under the 'Job Work' as defined under Section 2(68) of the Central Goods and Services Tax Act, 2017 and the Gujarat Goods and Services Tax Act, 2017. [In Re: Inox Air Products (P.) Ltd. 2018 (6) TMI 518 – AUTHORITY FOR ADVANCE RULI

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

INTEREST ON ITC AVAILED BUT NOT UTILIZED UNDER GST
By: – Vivek Jalan
Goods and Services Tax – GST
Dated:- 11-1-2019

Across the country objections have raised by the GST Department on erroneously availed but not utilized ITC. In this article we will discuss on such objections and the legal provisions in this regard.
First as per Sec 50(3) read with sec 42(10) of CGST Act, payment of interest is only triggered where there is a reduction in output tax liability. Hence in instances where there is no reduction in output tax liability but only erroneous availment of excess input credit, which has not been utilized by the assessee, interest liability is not triggered.
Secondly there is no financial benefit of availment of excess

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

xpayer. The Press Note stated as under –
“Amendment of section 50 of the CGST Act to provide that interest should be charged only on the net tax liability of the taxpayer, after taking into account the admissible input tax credit, i.e. interest would be leviable only on the amount payable through the electronic cash ledger”.
Hence in our view, in the cases where the excess input credit was erroneously availed but not utilized and was reversed through unutilized credit balance available in the electronic credit ledger in the GST Portal , there was no amount payable through the electronic cash ledger. Therefore there is no question of interest at all.
The above submission is also supported by the following judgements –
The Punjab & Haryan

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =

n trade without any justification and would be in violation of Articles 14, 19 & 301 of The Constitution of India.
Reply By Himansu Sekhar as =
Sir,
The provision of interest in my view depends upon the language of the statutory provisions. In Ind Swift case Hon'ble Apex Court analysed the situation as per the provisions of Rule 14 of CCR 2014 and held that interest is payable when the credit has been availed. Later on Rule 14 was amended and interest was charged after the credit was utilised.
With regards
Himansu Sekhar Sha
Dated: 11-1-2019
Reply By L D Raj & Co as =
Many cases were decided in Excise in favour of assessee, and later CCR were also amended that interest were leviable only on the ITC utilised erroneously and not

= = = = = = = =

Plain text (Extract) only
For full text:-Visit the Source

= = = = = = = =