Goods and Services Tax

GST – States – G.O.Ms.No. 290 – Dated:- 5-6-2018 – GOVERNMENT OF ANDHRA PRADESH REVENUE (COMMERCIAL TAXES-II) DEPARTMENT G.O.Ms.No.290, Dated: 05-06-2018 NOTIFICATION In exercise of the powers conferred by section 128 of the Andhra Pradesh Goods and Services Tax Act, 2017 (Act No.16 of 2017), the Government, on the recommendation of the Goods and Services Tax Council, hereby waives the late fee payable under Section 47 of the said Act for failure to furnish the return in FORM GSTR-3B by the due

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2018 (6) TMI 325 – CESTAT CHENNAI – TMI – Refund of double payment of duty made – For the month of June, 2014, the appellant paid duty of ₹ 17,44,041/- vide challan dated 02.02.2014, in the name of M/s. Kanishk Steel Industries inadvertently. On realising the mistake on the same date, they paid the amount of ₹ 17,44,041/- in their own name – The refund has been denied stating that the amount so paid is lying in the PLA account of M/s. Kanishk Steel Industries and, therefore, the appellant is not eligible for refund.
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Held that:- The Hon’ble High Court of Madras, in the case of M/s. Sundaram Industries Ltd. Vs. CCE Madurai [2015 (5) TMI 416 – MADRAS HIGH COURT], had considered a similar issue, and on production of No Objection letter from the company concerned, it was held by the High Court that refund has to be granted – In the present case also, the disclaimer certificate furnished by the appellant along with the refund claim – rejection of refund is without any lega

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hk Steel Industries inadvertently. On realising the mistake on the same date, they paid the amount of ₹ 17,44,041/- in their own name. Pursuant to such double payment by the appellants, they filed the refund claim. Show Cause Notice was issued, proposing to reject the claim which, after due process of law, the original authority rejected. In appeal, the Commissioner (Appeals) upheld the same. Hence, this appeal. 2. On behalf of the appellant, the learned Counsel Shri S. Venkatachalam, submitted that the appellant has produced the bank statement to show that on 07.07.2014 the amount was wrongly paid into the Central Excise Account of M/s. Kanishk Steel Industries Ltd. On realizing the mistake on the very same day, the appellant had paid the amount to their own Central Excise Account/ECC. The refund has been denied stating that the amount so paid is lying in the PLA account of M/s. Kanishk Steel Industries and, therefore, the appellant is not eligible for refund. He adverted to par

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Sponge Iron Division) 6. The only ground on which the refund has been rejected is that the amount is lying in the PLA account of M/s. Kanishk Steel Industries and, therefore, without proper No Objection Certificate from the said company the appellant cannot be granted refund. The Hon ble High Court of Madras, in the case of M/s. Sundaram Industries Ltd. Vs. CCE Madurai 2015 (321) ELT 37 (Madras), had considered a similar issue, and on production of No Objection letter from the company concerned, it was held by the High Court that refund has to be granted. In the present case also, the disclaimer certificate furnished by the appellant along with the refund claim, reads as under: We hereby undertake that the amount of refund Viz., ₹ 17,44,041-00 (Rupees Seventeen lacks fourty four thousand fourty one only ) will not be claimed by us. The same may please be refunded to CHENNAI FERROUS INDUSTRIES LTD., Gummidipoondi. 7. Thus, it is stated by M/s. Kanishk Steel Industries Ltd. that th

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Goods and Services Tax – Started By: – RAVINDRA SANCHETI – Dated:- 4-6-2018 Last Replied Date:- 9-6-2018 – Hello One of the client is a company registered as Non Profit Organisation and providing services of Commercial Pilot License Training to students. Query – Whether the company is liable for GST on Training Fees collected from their students on Training for Commercial Pilot License ? Please give reference of circular or notification if exempt. – Reply By Alkesh Jani – The Reply = Sir, In my point of view GST is applicable.Our experts may correct me if mistaken.Thanks – Reply By Alkesh Jani – The Reply = Sir, The training of commercial pilot can be classified under HSN 99929. No Exemption is available. Therefore, GST is applicable. Our experts may correct me if mistaken. Thanks, – Reply By YAGAY and SUN – The Reply = We endorse the view of Mr. Jani. – Reply By RAVINDRA SANCHETI – The Reply = Sir,Thanks for reply In service tax commercial pilot training was exempted since it is cons

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s and other conveyances except when they are used- (i) for making the following taxable supplies, namely:- (A) further supply of such vehicles or conveyances ; or (B) transportation of passengers; or (C) imparting training on driving, flying, navigating such vehicles or conveyances; From above, it is clear that you are eligible to take ITC of motor vehicles and other conveyances (in your case air-craft, gliders etc.) and you can take ITC only if you are to make taxable supplies, i.e. imparting training on flying. The exemption by an educational institute to its student and staff is limited to services mentioned and is not applicable in your case, moreover, in your case, if skill development corporation has declared any such scheme then you can avail that exemption, but as far as my knowledge permits no such scheme is declared, therefore, you are not eligible for this exemption also. Concluding, it can be said that you are required to pay GST. Hope now it is be clear for you. Thanks, –

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dents, faculty and staff; Nil Nil Term educational institute has been defined under Clause (y) of Para 2 of the Notification No. 12/2017 Central tax and Notification No. 12/2017State Tax (Rate) as educational institution means an institution providing services by way of- pre-school education and education up to higher secondary school or equivalent; education as a part of a curriculum for obtaining a qualification recognised by law for the time being in force; education as a pat of an approved vocational education course; A perusal of the entry 66 of the exemption notifications make is very clear that the exemption provided therein is very broad in scope and a blanket exemption from levy of CGST and TGST has been provided on any intra-state supply of services by an educational institution to its student, faculty and staff. No restriction has been made on the basis of nature of services. Only criteria for availing exemption is that supplier of service must qualify as educational institu

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rs Dictionary is bringing up or training; strengthening of the powers of body or mind; culture. In Advanced Law Lexicon (P. Ramanatha Aiyar, 3rd Edition, 2005, Vol.2) 'education' is defined in very wide terms. It is stated: Education is the bringing up; the process of developing and training the powers and capabilities of human beings. In its broadest sense the word comprehends not merely the instruction received at school, or college but the whole course of training moral, intellectual and physical; is not limited to the ordinary instruction of the child in the pursuits of literature. It also comprehends a proper attention to the moral and religious sentiments of the child. And it is sometimes used as synonymous with 'learning'. Hon ble Supreme Court in case of P.A. Inamdar and Ors. v. State of Maharashtra and Ors, AIR 1976 SC 10 while dealing with the basic concept of education has expressed the view as follows: Education is continued growth of personality, steady dev

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ein while dealing with the conception of education their Lordships have observed thus: Education means the systematic instruction, schooling or training given to the young in preparation for the work of life. It also connotes the whole course of scholastic instruction which a person has received…what education connotes is the process of training and developing the knowledge, skill, mind and character of students by formal schooling. D.4 From the above it is very clear that the term education as in literal sense and as defined by the Hon ble Supreme Court, is much wider. Term education encompasses every learning, experience and knowledge gained consciously or unconsciously. Education is a process by which latent capabilities and qualities of a person got polished and refined and makes that person a whole new one in terms of intellectual, social and moral. In a nutshell what education connotes is the process of training and developing the knowledge, skill, mind and character of student

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o service Tax on Flying Training Institute and Aircraft Engineering Institutes under Commercial Training or Coaching Services? (ii.) Whether, the course Completion Certificate offered by such Institutes, to successful students, qualifies as any certificate of diploma or degree or any educational qualification recognized by law for the time being in force or not? The assessee, namely M/s Garg Aviations Limited is a company registered under the Companies Act, 1956 and is running a Flying Training Institute and Aircraft Maintenance Engineering Institute at Kanpur. It is engaged in providing training and coaching to individuals in the field of flying of aircraft for obtaining Commercial Pilot License from the Director Civil Aviation (DGCA), New Delhi. It is also engaged in providing training for obtaining Basic Aircraft Maintenance Engineering Licence. A similar issue arose before the Delhi High Court in Indian Institute of Aircraft Engineering (Supra). The Delhi High Court held as follows

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n 65(27) making such exclusion has been deleted but the Notification dated 25th April, 2011 supra issued in exercise of powers under Section 93 of the Finance Act has exempted coaching or training leading to grant of a certificate or diploma or degree or any educational qualification which is recognized by any law from the whole of Service Tax leviable under Section 66 of the Finance Act . 14. We have wondered, what could be the reason for exempting from payment of service tax those training or coaching centres, even though commercial, whose certificate/degree/diploma/ qualification is recognized by law. The only plausible reason, according to us, can be to exclude from ambit of service tax those training or coaching centres which are otherwise regulated by any law in as much as recognition of certificate/degree/diploma/qualification conferred by such training or coaching centres will necessarily entail regulation by the same law of various facets of such training or coaching centres.

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ose of eligibility for obtaining ultimate licence/approval for certifying repair/maintenance/airworthiness of aircrafts. The Act, Rules and CAR distinguish an approved Institute from an unapproved one and a successful candidate from an approved institute would be entitled to enforce the right, conferred on him by the Act, Rules and CAR, to one year relaxation against the DGCA in a Court of law. The inference can only be one, that the Course Completion Certificate/training offered by such Institutes is recognized by law. 26……….. 27……….. 28. We are therefore of the view that the Instruction aforesaid holding the petitioner to be assessable to Service Tax is contrary to Section 65(27) and the Notification dated 25th April, 2011. Accordingly the said Instruction and the show cause notices given to the petitioner are quashed. The Rule is made absolute and the writ petition is disposed of. Learned counsel appearing for the revenue has not been able to persuade the Court to take a

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ining and coaching provided by flight training institutes are exempted from GST. it may be noted that words commercial training or coaching has not been used in GST. Hence there is no point in discussing whether any activity of imparting knowledge would qualify as coaching or training or education. any service provided by an educational institution shall be exempted and to qualify as an educational institution, such institution must provide education (which could be either pure theoretical knowledge or practical knowledge ore even training in some sport) which is part of the curriculam for obtainining a qualification recognised by law for the time being in force. it may gains be noted that under GST they do not words a degree diploma certificate but qualification which is wider in nature and very well covered commercial pilot license. services – Reply By Alkesh Jani – The Reply = Sir,I welcome the opinion expressed by Sh. Akash Deep ji, but the views expressed by him refer to Sl.No. 66

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Goods and Services Tax – GST – Dated:- 4-6-2018 – Q.1 Whether Banks are required to capture the details of ATMs in registration certificate as a place of business ? Ans. No. Banks are not required to provide the details of ATMs while applying for registration. For the purposes of registration, ATM on its own does not constitute a place of business, as defined in the CGST Act, 2017. Q.2 As per RBI guidelines, Banks can use third party ATMs, Business Correspondents (BC), Customer Service Points (CSP) or third party warehouses. Are Banks required to include these third party places also in their GST registration? Ans- No. Third party places are neither places of business nor fixed establishments from where Banks ordinarily carry on their business. These are independent service providers to the Bank which are subject to GST. Thus, these places are not required to be declared as place of business by the Bank. Q.3 What will be the time of supply in respect of services rendered upto 30th Jun

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n made (prior to issuance of invoice) as advance before the 1st of July, 2017, the tax would be payable under the law prevalent prior to 1st July, 2017, as the point of taxation had arisen before this date to the extent of advance. Q5. Is it necessary for Banks / insurers to report the details of exempt and non-GST supplies in Table 8 of GSTR-1? Ans. Yes. In the absence of any specific exemption to the Banks / insurers, the information is required to be provided in the said table. Q6. Is it necessary for Banks / insurers to report the details of invoices in Table 13 of GSTR-1? Ans. Rule 54(2) of the CGST Rules, 2017 provides that in case of an insurer or a banking company or a financial institution, including a non-banking financial company, the tax invoice or any other document in lieu thereof, may not be serially numbered. But this does not mean that such document will not have any identification number which is required for the purpose of matching. The said entities are, therefore,

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cases where the turnover in States/Union Territories for the previous financial year is not available. Therefore, in such cases, for the quarters after July 2017 to September 2017, the State/UT-wise turnover for the purposes of ISD can be determined based on the turnovers for the quarter of July 2017 to September 2017. For the months of July, August and September, 2017, the turnover for the month of July, 2017 may be considered for the purposes of distribution of credit. Q9- Is the condition to make payment for the value of supply plus the GST thereon required to be complied with by the recipient to claim the input tax credit where supplies for services are made between distinct persons? Ans. No, this condition is not required to be complied with by the recipient. As per the proviso to sub rule (1) of Rule 37 of the CGST Rules, 2017 the value of supplies made without consideration as specified in paragraph 2 of Schedule I of the CGST Act, 2017 shall be deemed to have been paid for the

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es / document for supply of its services, how will the service recipient get credit for GST on the services provided by the bank? Ans. Under Rule 54(2) of the CGST Rules, 2017 a banking company or a financial institution including a NBFC or an insurer can issue an invoice or any other document in lieu thereof whether or not serially numbered and whether or not containing the address of the recipient but containing other information as mentioned under Rule 46. There is no restriction on the invoice/document being a consolidated invoice/document but it must bear an identification number, which need not necessarily be serially numbered. The recipient of service will get the credit for GST so long as the bank, etc. uploads the details of the invoice / document under that number with GSTIN of the recipient in its statement if FORM GSTR-1. Q12. Is the registered person procuring goods or services from a supplier outside India required to raise a self-invoice, debit note or credit note in res

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it note for each such supply should be reported in the GST return of the month in which the supply takes place as per the provisions of section 12(3) or 13(3) of the CGST Act, 2017. As the import of goods would be under the cover of a bill of entry, there is no need to raise a self-invoice. It may, however, be noted that section 9(4) of the CGST Act, 2017 / section 5(4) of the IGST Act, 2017 has been suspended vide notification No. 38/2017-Central Tax, as amended from time to time. Q 13. For supply of taxable services, can a digitally signed invoice be issued in duplicate, with the original being marked as Original and the duplicate copy being marked as Duplicate ? Ans. In the context of digitally signed documents, the requirement of issuing original and duplicate invoices does not arise. A digitally signed invoice can be retained by the supplier and also be made available to the recipient. Q 14. Is there a requirement to issue a payment voucher at the time of making payment to the for

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he location of the third party service providers and after repairs, the equipment may be moved to a central / regional location for the purpose of programming, encryption, reconfiguration, etc. and thereafter to that place of business from where the equipment had been sent earlier. The equipment can be moved between such locations on the basis of a delivery challan . Q 16. Is a Bill of Supply to be issued by a bank for exempt services like interest on loans and advances, inter-se sale or purchase of foreign currency amongst banks? Ans. As per clause (c) of sub-section (3) of section 31 of the CGST Act, 2017 read with Rule 49 of the CGST Rules, 2017, there is a requirement for issuance of bill of supply for supply of exempt services by Banks. It may be noted, however, that there is no need to issue a separate bill of supply in case any invoice or document has already been issued in accordance with the provisions of any other law. Further, in view of the provisions contained in sub-rule

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for reversal of 5o percent will also apply to bullion purchased by the Bank? Ans. In terms of Section 2(94) read with Section 25(4)&(5) of the CGST Act, 2017, a person required to obtain more than one registration within a State or more than one State shall be treated as a distinct person for each such registration. Section 17(4) of the CGST Act, 2017 is applicable qua each registration and not for the Bank as a whole, provided each of the business verticals is separately registered. Therefore, a bank engaged in trading in bullion may not opt for 5o percent reversal in respect of its purchases of bullion, where it is separately registered as a business vertical. Q 19. Where there is a supply of goods or services between registered branches of a banking company on which GST is paid, will the recipient branch/office be eligible for i00% credit of the GST charged on such supply where the bank elects the 5o% option to avail input tax credit on inputs, capital goods and input services?

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versal. Q 21. Whether the provision of section 18(6) for reversal of input tax credit availed on capital goods be applicable to banks only to the extent of the input tax credit availed? Ans. Yes. The provisions of section 18(6) of the CGST Act, 2017 for reversal of input tax credit availed on capital goods would be applicable to banks only to the extent of the input tax credit availed by it. In case the Bank opts to avail input tax credit to the extent of 5o% in terms of the second proviso to Section 17(4) of the CGST Act, 2017, reversal of credit would be in proportion to the actual credit availed by the Bank i.e. only with reference to 50% of the input tax credit availed by it on capital goods. Q 22. Can a Bank / insurer defer the availment of input tax credit for a month or quarter and avail of the same in subsequent months? Ans. Yes. As per section 16(4) of the CGST Act, 2017, availment of input tax credit can be deferred and availed upto the due date of furnishing of return for th

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ds of the supplier of services if services are provided to an unregistered person. Address available on records of the insurance company, which is ordinarily used for communication with the customer, may be considered as the Place of Supply . Q 24. With respect to registered customers, whether the Bank / insurance company is required to ascertain the place of consumption of service or whether the Bank can rely upon the GSTIN provided by the Customer? Ans. The Bank / insurance company can rely upon the GSTIN provided by the customer. 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

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ersonal use or for the use of the family members of diplomatic agents or career consular officers posted therein? Ans. Yes, the bank / insurer is required to charge GST in such cases. However, as per section 55 of the CGST Act, 2017, subject to such conditions and restrictions as may be prescribed, such service recipients would be entitled to claim a refund of taxes paid on the notified supplies of services received by them. Q 29. Who is liable to comply with GST on charges levied by Overseas Correspondent Banks facilitating trade and other cross border transactions? Ans. In this case, there are two supplies namely, from bank in India to the importer/exporter and one from the overseas correspondent banks to the bank in India. So the liability to discharge GST on such supplies will be required to be determined accordingly. Q 30. Will the second proviso to Rule 28 apply in the case of a banking company that selects the 5o% option to avail input tax credit set out in section 17(4) of the

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ted without consideration. Therefore, where the services are supplied by a supplier without consideration to an unrelated recipient or a person other than a related or distinct person, the same would not amount to supply and not liable to GST. Q 32. Can value of services be enhanced by invoking the CGST Rules in case of services provided by banks at a concessional / differential rate to a recipient other than related party / distinct person ? Ans. Banks provide various services to customers for a charge. However, at times, account holders / customers are provided services free or at a concessional / differential rate. The free or concessional / differential rate is offered considering factors such as credit rating and stability of the customer, size of relationship, expected future business or the opportunity presented in the market elsewhere etc. As a result, the charges for the same service may differ from customer to customer. Such services provided to persons who are not related pe

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of section 2 of the Securities Contracts (Regulation) Act, 1956 (SCRA). Derivatives are included in the definition of securities under section 2(h)(ia) of the SCRA. In terms of section 2(ac) of SCRA, derivative includes (A) a security derived from a debt instrument, share, loan, whether secured or unsecured, risk instrument or contract for differences or any other form of security; (B) a contract which derives its value from the prices, or index of prices, of underlying securities. The definition of derivatives in SCRA is an inclusive definition. As derivatives fall in the definition of securities, they are not liable to GST. However, if some service charges or service fees or documentation fees or broking charges or such like fees or charges are charged, the same would be a consideration for provision of service and chargeable to GST. Q 35. What is the nature of income / expenditure on Collateralized Borrowing and Lending Obligations (CBLO) transactions? Ans. In CBLO transaction, the

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T Act, 2017, future contracts are not chargeable to GST. But where the future contracts have a delivery option and the settlement of contract takes place by way of actual delivery of underlying commodity/currency, then such forward contracts would be treated as normal supply of goods and liable to GST. Further, if some service charges or service fees or documentation fees or broking charges or such like fees or charges are charged, the same would be a consideration for supply of service and chargeable to GST. Q 37. Would forward contracts in commodities or currencies be within the ambit of definition of supply ? Ans. A forward contract is an agreement, executed, to purchase or sell a pre­determined amount of a commodity or currency at a pre-determined future date at a pre-determined price. The settlement could be by way of actual delivery of underlying commodity/currency or by way of net settlement of differential of the forward rate over the prevailing market rate on the settlemen

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rowing funds by selling securities with an agreement to repurchase the securities on a mutually agreed future date at an agreed price which includes interest for the funds borrowed. Section 45U (d) of the RBI Act, 1934 defines reverse repos as an instrument for lending funds by buying securities with an agreement to re-sell the securities on a mutually agreed future date at an agreed price which includes interest for the funds lent. Repos and reverse repos are financial instruments of short term call money market that are normally used by banks to borrow from or lend money to RBI. The margins, called the repo rate or reverse repo rate, in such transactions are nothing but interest charged for lending or borrowing of money. Thus they have the characteristics of loans and deposits for interest and are accordingly exempt from GST [serial no. 27 of the table of notification No. 12/2017-Central Tax (Rate) dated 28th June, 2017, as amended]. Q 39. Would income from Commercial Paper (CP) or C

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7-Central Tax (Rate) dated 28th June, 2017, as amended]. Further, promissory note is included in the definition of money as given in clause (75) of Section 2 of the CGST Act, 2017 and hence not liable to GST. However, if some service charges or service fees or documentation fees or broking charges or such like fees or charges are charged, the same would be a consideration for supply of services and chargeable to GST. Q 40. Whether assignment or sale of secured or unsecured debts is liable to GST? Ans. Section 2(52) of the CGST Act, 2017 defines goods to mean every kind of movable property other than money and securities but includes actionable claim. Schedule III of the CGST Act, 2017 lists activities or transactions which shall be treated neither as a supply of goods nor a supply of services and actionable claims other than lottery, betting and gambling are included in the said Schedule. Thus, only actionable claims in respect of lottery, betting and gambling would be taxable under GS

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epresent taxable consideration and hence liable to GST. Q 43. To what extent is invoice discounting or cheque discounting or any other similar form of discounting exempt under GST? Ans. Discounting of invoices or cheques falls within the meaning of services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount . Such discounting is exempt from payment of GST, as such discounting is nothing but a manner of extending a credit facility or a loan. However, if some service charges or service fees or documentation fees or broking charges or such like fees or charges are charged, the same would be a consideration for supply of service and chargeable to GST. Q 44. Is interest on debt instruments exempt from GST? Ans. Yes. As debt instruments such as debentures, bonds etc. are in the nature of loans, interest thereon will be exempt from GST. Q 45. Is GST required to be paid on additional interest charged in case of default i

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osits, loans or advances in so far as the consideration is represented by way of interest or discount (other than interest involved in credit card services) is exempt. But, in a financial lease the ownership of the asset is with the bank. In essence, it is a purchase the asset and lend it further transaction for bank. Therefore, neither the services are purely in the nature of extending loans nor the consideration for a financial lease is purely in the nature of interest. Thus, interest on finance lease transactions will be taxable under GST. Q 48. Where GST is charged on a supply of service and the amounts due from the customer become irrecoverable as a bad debt in commercial practice, would such GST paid on accrual basis be refundable to the service provider by the Government? Ans. The adjustment of GST already paid is allowed only by way of issuance of credit /debit note in terms of Section 34 of the CGST Act, 2017. The proviso to section 34(2) of the CGST Act, 2017 provides that no

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rs located outside India is the location of the service provider i.e. banking company. Account has been defined in Explanation (a) to section 13(8) of the IGST Act, 2017 to mean an account which bears interest to the depositor, and includes a non-resident external (NRE) account and a non-resident ordinary (NRO) account. Services provided to holders of demand deposits, term deposits, NRE account and NRO account outside India will be covered by the definition of account referred to above. Examples of such services are: (i) services linked to or requiring opening and operation of bank accounts, such as, lending and deposits; (ii) transfer of money including telegraphic transfer, mail transfer, electronic transfer etc. Q 51. Which services do not qualify as services provided to account holder as per Section 13(8) of the IGST Act, 2017 and thus the place of supply will be the location of the recipient of services? Ans. Following are examples of services that are generally not provided by a

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is the location of the supplier in case of banking and other financial services where multiple locations are involved in providing the services to a customer? Ans. Banking services emanate from the bank account opened by a customer with the branch of a bank or through a contractual relationship between the branch of a bank and the customer. The branch holding the customer s account is referred to as the Account Branch or the Home Branch . An account would include all types of accounts – viz. interest bearing, non- interest bearing, loan account, deposit account, etc. In the present day of anywhere banking , the customer avails banking services through mobile/ internet banking or by visiting any branch of the bank. At times the services are provided through branches / locations other than the Account Branch or the Home Branch . It is clarified that the services provided by the other branches are actually services provided to the Home branch and are ultimately billed to the home branch.

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s like cheques, drafts, pay orders, promissory notes, letters of credit, etc. Therefore, activities that are only transactions in such instruments would be outside the definition of service. This would include transactions in Commercial Paper ( CP ) and Certificate of Deposit ( CD ) (as they are in the nature of promissory notes), issuance of drafts or letters of credit, etc. While these transactions would be outside the ambit of supply, the related activity, for which a separate consideration is charged, would be chargeable to GST if other elements of taxability are present. Therefore, GST would be levied on service charges normally charged for various transactions in money including charges for making drafts, issuance charges for letter of credit etc. Definition of securities includes derivatives . Transactions in instruments like interest rate swaps, and foreign exchange swaps would be excluded from the definition of supply since such instruments are derivatives, being securities, b

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in view of the sub-clause (v) of section 2(6) of the IGST Act, 2017 read with Explanation 1 to section 8 of the IGST Act, 2017. Q 55. Will the management oversight or stewardship activities performed in relation to business operations by the Head Office of a Bank to a Branch in India be considered as a supply of services by the Head Office even when there is no consideration charged by the Head Office, nor any expenditure recorded in the books of account of the Branches? Ans. As per Schedule – I to the CGST Act, 2017, supply of services between distinct entities will be a taxable supply even in absence of a consideration. Q 56. If tax is payable on provision of management oversight or stewardship services by a related person, what shall be the value of supply when no invoice is raised, no payment is made by recipient or no entry is made in the books of accounts of the recipient of service? What will be the time of supply? Ans. As per Rule 28 of the CGST Rules, 2017, the Bank may obtai

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nce of gold by the Customs. Q 58. Will there be another liability for payment of GST when the gold (metal) is appropriated or drawn from the consignment stock by the Nominated Bank? Ans. The supply of gold (metal) is already deemed to have taken place in terms of para 3 of Schedule I of the CGST Act, 2017 when the same was despatched by the overseas supplier to the Nominated Bank. Since the supply has already taken place, there will not be another supply when the gold is drawn or appropriated by the Nominated Bank from the stock. There will, therefore, not be another levy of GST. Q 59. In the case of gold (metal) loan, whether the supply of gold (metal) to the jeweller will be deemed to take place at the time of delivery of gold (metal) or at the time when the price of gold (metal) is fixed by the jeweller? Ans. The Gold (Metal) Loan Scheme approved by the Reserve Bank of India is a means of financing. The Banks deliver gold (metal) to the jewellers who appropriate and use the same in

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g. The jewellers can purchase gold (metal) from the Banks on outright basis on payment of the price. The gold (metal) loan only provides an option to the jeweller to avail a loan and pay for gold (metal) at a future date. For this facility, the jeweller pays interest to the Bank. The grant of loan and levy of interest is dependent on the purchase of gold, and therefore, part of the same transaction or facility; therefore the interest, which is the consideration, will not be exempt as per provisions of section 15(2)(d) of the CGST Act, 2017. Q 61. What will be the place of supply in cases where the account is held in a bank in one State but some services are availed in a different branch of the same bank in another State. Ans. As per the provisions of Section 12(12) of the IGST Act, 2017, the place of supply of services for a bank is the location of the recipient of the services on the records of the supplier of services. In general, this will be the State in which the account exists. F

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ange fees on card settlement fees paid/shared by banks? Ans. Fees charged for card settlement is a consideration which is part of a separate transaction between the banks which are parties to this transaction and shall be liable to GST. This is a B2B supply and credit of this transaction is available. Q 65. What is the leviability of GST on securitization transactions undertaken by banks? Ans. Securitized assets are in the nature of securities and hence not liable to GST. However, if some service charges or service fees or documentation fees or broking charges or such like fees or charges are charged, the same would be a consideration for provision of services related to securitization and chargeable to GST. INSURANCE SECTOR Q. 66 What is the location of the supplier of service for fund management charges in ULIP policies? Ans. The fund management charges are charges towards managing and administering the fund. These funds are managed by the Fund Management team. The location of the su

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vertible foreign exchange or from the NRE Accounts? Ans. No. The amounts paid from the Non-Resident External Accounts are paid in Indian Rupees and are not received in convertible foreign exchange. Therefore, the conditions for export of services as provided under section 2(6) of IGST Act, 2017 are not satisfied. Life Insurance services in such cases would be treated as inter-State supplies and subject to GST. Q. 69. Will the requirements of Letter of Undertaking or Bond be required to be complied with in the case of Life Insurance Premium where the conditions of export of services are satisfied before or at the time of supply of the Life Insurance Service? Ans. Yes. As per Section 16(3) of the IGST Act, 2017, read with Rule 96A of the CGST Rules, 2017, an exporter is required to submit a Letter of Undertaking or Bond in case the export of service is made without payment of integrated tax. Q. 70. What would be the time of supply of life insurance services? Ans. Insurance policies are c

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CGST Act, 2017 specifically provides for refund of tax paid under the Finance Act, 1994 in respect of services not provided. The same shall be disposed off in accordance with the provisions of the Chapter V of the Finance Act, 1994. Q. 72. Can the input tax credit of Krishi Kalyan Cess be carried forward? Ans. No. It is not permitted in terms of section 140(1) of the CGST Act, 2017 read with Rule 117(1) of the CGST Rules, 2017. Q. 73. In the case of group insurance policies, a Master Policy is issued; the beneficiaries of the Master Policy may be located in more than one State. In such cases, what will be the place of supply of services? Ans. In the case of issuance of Master / Group Policy to a registered person where the premium charged is a single premium and not segregated based on the beneficiaries of the insurance policies, the place of supply for such policy will be the location of the registered person paying the premium. Q. 74. What is the time of supply of services for depos

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case of stock broking, whether stamp duty or securities transaction tax or other Central or State taxes would be considered as a part of the value of supply as prescribed under Section 15 of the CGST Act, 2017, for levy of GST? Ans. GST is not payable by the stock brokers on these recoveries as long as the conditions of pure agent as provided in Rule 33 of the CGST Rules, 2017 are met. If not, then valuation will be done as per section 15 of the CGST Act, 2017 read with Rule 27 of CGST Rules, 2017. Q. 78. Is brokerage earned in stock broking service liable to Goods and Services Tax? Ans. Yes. Since the stock brokers are engaged in the business of supplying the stock broking service, appropriate GST is payable on the same. Q.79. Can a person take voluntary registration under the Act? Ans. Section 25(3) of the CGST Act, 2017 states that a person, though not liable to be registered under section 22 or section 24 of the CGST Act, 2017 may get himself registered voluntarily, and all provis

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of supply shall be determined as per section 13(8) of the IGST Act, 2017 i.e. as an intermediary. Q.82. Do stock brokers fall in the definition of intermediary under section 2(13) of the IGST Act, 2017? Ans. Yes. Since stock brokers arrange the supply of securities between two or more persons, stock brokers would be covered by the definition of intermediary Q.83. Would sub-brokers/ Authorized Persons fall in the definition of agent under Section 2(5) of the CGST Act, 2017? What would be the registration requirement for subbrokers/ Authorized Persons in the context of the Goods and Services Tax Regime? Ans. As per Stock Brokers and Sub Brokers Regulation, 1992 issued by SEBI, a subbroker means any person, not being a member of stock exchange, who acts on behalf of a stock broker as an agent or otherwise for assisting the investors in buying, selling or dealing in securities through such stock brokers . It is, therefore, apparent that the sub broker may not only be providing services to

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or (ii) a place where a taxable person maintains his books of account; or (iii) a place where a taxable person is engaged in business through an agent, by whatever name called. In case of operations of a stock broker, it is required by law that all transactions would be via screen based trading on the Stock Exchanges. Therefore, the following would be the place of business in case of stock brokers: (i) All the branches of the stock broker where the Stock Exchange Trading terminals are located and where trade is carried out on behalf of clients; (ii) Main office/ Head office/ Registered Office/ Branch office where back office operations are carried out including issuing of bills/ contracts/ tax invoices/account statements to the clients. In case of sub-brokers / Authorised Person office, where the premises are neither owned by the stock broker nor rented/ leased in favour of the stock broker and there are no employees on the payroll of the stock broker in such an office, then such prem

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17 a registered person who has paid integrated tax on a supply considered by him to be an inter-State supply, but which is subsequently held to be an intra-State supply, shall be granted refund of the amount of integrated tax so paid in such manner and subject to such conditions as may be prescribed . Under section 19(2) of the IGST Act, 2017 a registered person who has paid Central tax and State tax or Union territory tax, as the case may be, on a transaction considered by him to be an intra-State supply, but which is subsequently held to be an inter-State supply, shall not be required to pay any interest on the amount of integrated tax payable . Therefore, in case a registered person has paid Integrated tax instead of Central tax and State tax or Union territory tax, then he shall be granted refund of the amount paid as Integrated tax and he will have to pay Central tax and State tax or Union territory tax. Further, no interest will be payable on the Central tax and State tax or Unio

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Can the stock broker continue to issue bills and contracts under the normal Stock Exchange mechanism and issue a monthly tax invoice for the purpose of Goods and Services Tax? Ans. The stock broker can issue bills and contracts under the normal Stock Exchange mechanism mentioning the GST amount but will have to issue a tax invoice as envisaged under Section 31(2) of the CGST Act, 2017 read with Rule 47 of the CGST Rules, 2017. Q.89. What is considered as securities under the Goods and Services Tax Act? Are they taxable under GST? Ans. Section 2(101) of the CGST Act, 2017 defines securities to have the same meaning as assigned to it in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956. Section 2(52) of the CGST Act, 2017 defines goods to mean 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 to be severed before supply or under a c

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ndividual goods or services or a group of related goods or services which is subject to risks and returns that are different from those of the other business verticals. Explanation.-For the purposes of this clause, factors that should be considered in determining whether goods or services are related include- (i) the nature of the goods or services; (ii) the nature of the production processes; (iii) the type or class of customers for the goods or services; (iv) the methods used to distribute the goods or supply of services; and (v) the nature of regulatory environment (wherever applicable), including banking, insurance, or public utilities . It is the choice of the taxable person to build all the services provided in one vertical or separate verticals based on their business models and requirements. They may choose to obtain separate registration as a business vertical in terms of the proviso to section 25(2) of the CGST Act, 2017. Q.91. Whether GST will be levied on the exit-load on m

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Goods and Services Tax – Started By: – SURYAKANT MITHBAVKAR – Dated:- 4-6-2018 Last Replied Date:- 7-6-2018 – To file Trans-2 due date is 30th June-18 Who is eligible to file trans-2 We have file Trans-1 for traders stock details. – Reply By Alkesh Jani – The Reply = Sir, The TRAN-2 is to be filed under Rule 117 (4) (b) (iii), same is given below:- (iii) The registered person availing of this scheme and having furnished the details of stock held by him in accordance with the provisions of claus

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Goods and Services Tax – Nature of supply – divisible contract [Supply of goods & Supply of Services] or an indivisible contract [works contract] – Construction of power lines, erection of transmissio

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GST – States – S.O.75/P.A.5/2017/S.128/2018 – Dated:- 4-6-2018 – GOVERNMENT OF PUNJAB DEPARTMENT OF EXCISE AND TAXATION (EXCISE AND TAXATION-II BRANCH) NOTIFICATION The 4th June, 2018 No. S.O.75/P.A.5/2017/S.128/2018.-In exercise of the powers conferred by section 128 of the Punjab Goods and Services Tax Act, 2017 (Punjab Act No.5 of 2017), and all other powers enabling him in this behalf, the Governor of Punjab, on the recommendations of the Council, is pleased to waive the late fee payable un

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GST – States – G.S.R.38/P.A.5/2017/S.164/Amd.(14)/2018 – Dated:- 4-6-2018 – GOVERNMENT OF PUNJAB DEPARTMENT OF EXCISE AND TAXATION (EXCISE AND TAXATION-II BRANCH) NOTIFICATION The 4th June, 2018 No. G.S.R.38/P.A.5/2017/S.164/Amd.(14)/2018.-In exercise of the powers conferred by section 164 of the Punjab Goods and Services Tax Act, 2017 (Punjab Act No.5 of 2017), and all other powers enabling him in this behalf, the Governor of Punjab, on the recommendations of the Council, is pleased to make the following rules further to amend the Punjab Goods and Services Tax Rules, 2017, namely:- RULES 1. (1) These rules may be called the Punjab Goods and Services Tax (Sixth Amendment) Rules, 2018. (2) They shall be deemed to have come into force on and with effect from the 18th April, 2018. 2. In the Punjab Goods and Services Tax Rules, 2017 (hereinafter referred to as the said rules), in rule 89, for sub-rule (5), the following shall be substituted, namely:- (5) In the case of refund on account o

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the amount of integrated tax determined under sub-section (5) of section 54 of the Central Goods and Services Tax Act, 2017, read with section 20 of the Integrated Goods and Services Tax Act, 2017, shall be deposited in the Fund. (2) Where any amount, having been credited to the Fund, is ordered or directed to be paid to any claimant by the proper officer, appellate authority or court, the same shall be paid from the Fund. (3) Accounts of the Fund maintained by the Central Government shall be subject to audit by the Comptroller and Auditor General of India. (4) The Government shall, by an order, constitute a Standing Committee (hereinafter referred to as the Committee ) with a Chairman, a Vice-Chairman, a Member Secretary and such other members as it may deem fit and the Committee shall make recommendations for proper utilization of the money credited to the Fund for welfare of the consumers. (5) (a) The Committee shall meet as and when necessary, generally four times in a year; (b) th

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ments, or commodities in custody and control of the applicant, as may be necessary for proper evaluation of the application; (c) to require any applicant to allow entry and inspection of any premises, from which activities claimed to be for the welfare of consumers are stated to be carried on, to a duly authorised officer of the State Government, as the case may be; (d) to get the accounts of the applicants audited, for ensuring proper utilisation of the grant; (e) to require any applicant, in case of any default, or suppression of material information on his part, to refund in lump-sum along with accrued interest, the sanctioned grant to the Committee, and to be subject to prosecution under the Act; (f) to recover any sum due from any applicant in accordance with the provisions of the Act; (g) to require any applicant, or class of applicants to submit a periodical report, indicating proper utilization of the grant; (h) to reject an application placed before it on account of factual in

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selective basis) for reimbursing legal expenses incurred by a complainant, or class of complainants in a consumer dispute, after its final adjudication; (d) for making available grants for any other purpose recommended by the Central Consumer Protection Council (as may be considered appropriate by the Committee); (e) for making available up to 50% of the funds credited to the Fund each year, for publicity/ consumer awareness on GST, provided the availability of funds for consumer welfare activities of the Department of Consumer Affairs is not less than twenty five crore rupees per annum. Explanation.- For the purposes of this rule, (a) 'applicant' means, (i) the Central Government or State Government; (ii) regulatory authorities or autonomous bodies constituted under an Act of Parliament or the Legislature of a State or Union Territory; (iii) any agency or organization engaged in consumer welfare activities for a minimum period of three years, registered under the Companies Ac

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time; (c) 'Central Consumer Protection Council' means the Central Consumer Protection Council, established under sub-section (1) of section 4 of the Consumer Protection Act, 1986 (68 of 1986), for promotion and protection of rights of consumers; (d) 'Committee' means the Committee constituted under sub-rule (4); (e) 'consumer' has the same meaning as assigned to it in clause (d) of sub-section (1) of section 2 of the Consumer Protection Act, 1986 (68 of 1986), and includes consumer of goods on which central tax has been paid; (f) Fund means the Fund established by the State Government under section 57 of the Punjab Goods and Services Tax Act, 2017; (g) 'proper officer' means the officer having the power under the Act to make an order that the whole or any part of the state tax is refundable.". 4. In the said rules, in FORM GST ITC-03, after entry 5 (e), for the instruction against ** , the following shall be substituted, namely:- ** The value of ca

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t tax credit/Tax payable (whichever is higher) (Rs.) Central tax State Union territory tax Integrated tax Cess 1 2 3 4 5 6 7 8 9 10 11 12 8 (a) Inputs held in stock (where invoice is available) 8 (b) Inputs contained in semi-finished or finished goods held in stock (where invoice is available) 8 (c) Capital goods/plant and machinery held in stock 8 (d) Inputs held in stock or inputs as contained in semi-finished /finished goods held in stock (where invoice not available) 9. Amount of tax payable and paid (based on Table 8) Sr. No. Description ITC reversible/ Tax payable Tax paid along with application cancellation of registration (GST REG-16) Balance payable (3-4) Amount paid through debit to electronic cash ledger Amount paid through debit to electronic credit ledger Central Tax State/ Union territory Tax Integrated Tax Cess 1 2 3 4 5 6 7 8 9 10 1. Central Tax 2. State/Union territory Tax 3. Integrated Tax 4. Cess 10. Interest, late fee payable and paid Description Amount payable Amou

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ner on which input tax credit has been availed. 3. Following points need to be taken care of while providing details of stock at Sl. No.8: (i) where the tax invoices related to the inputs held in stock or inputs contained in semi-finished or finished goods held in stock are not available, the registered person shall estimate the amount under sub-rule (3) of rule 44 based on prevailing market price of the goods; (ii) in case of capital goods/ plant and machinery, the value should be the invoice value reduced by 1/60th per month or part thereof from the date of invoice/purchase taking useful life as five years. 4. The details furnished in accordance with sub-rule (3) of rule 44 in the Table at Sl. No. 8 (against entry 8 (d)) shall be duly certified by a practicing chartered accountant or cost accountant. Copy of the certificate shall be uploaded while filing the details. 6. In the said rules, for FORM GST DRC-07, the following shall be substituted, namely:- FORM GST DRC-07 [See rule 142(

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2018 (7) TMI 1823 – KERLA HIGH COURT – 2018 (18) G. S. T. L. 792 (Ker.) – Release of seized Jewellery – petitioner is unable to furnish bank guarantee in terms of sub-rule (1) of Rule 140 of the Rules – Held that:- It was pointed out that the seized articles belong to third parties, entrusted to the petitioner for Hall Marking and the owners of the articles are prepared to furnish bank guarantee so as to enable the petitioner to claim release of the seized articles – there is no stipulation anywhere that the security shall be furnished by the party claiming release of the seized articles.
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The writ petition is disposed of directing the third respondent to release the seized articles in accordance with sub-section (6) of Section 67 of

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tion proceedings before the third respondent in furtherance to the seizures are yet to be over. The petitioner seeks directions to the third respondent to release the seized jewelery pending confiscation proceedings. 2. Heard the learned counsel for the petitioner as also the learned Government Pleader. 3. Sub-section (6) of Section 67 of the Act confers power on the third respondent to release the seized articles on provisional basis, upon execution of a bond and furnishing of a security, in such manner and of such quantum, respectively, as may be prescribed or on payment of applicable tax, interest and penalty payable, as the case may be. Sub-rule (1) of Rule 140 of the Kerala State Goods and Service Tax Rules (the Rules) provides that th

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m release of the seized articles. I do not find any stipulation anywhere that the security shall be furnished by the party claiming release of the seized articles. In the circumstances, the writ petition is disposed of directing the third respondent to release the seized articles covered by Exts.P9 and P9(a) orders to the petitioner in accordance with sub-section (6) of Section 67 of the Act and sub-rule (1) of Rule 140 of the Rules. If the petitioner is unable to furnish bank guarantee in terms of sub-rule (1) of Rule 140 of the Rules, the bank guarantees furnished by the third parties for the said purpose shall be accepted. It is made clear that this Court has not adjudicated the contentions of the petitioner. – Case laws – Decisions –

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2018 (7) TMI 1691 – AUTHORITY FOR ADVANCE RULINGS MAHARASHTRA – 2018 (15) G. S. T. L. 404 (A. A. R. – GST) – Levy of GST – Classification – composite supply – EPC Contract – standalone contract for transportation of Equipment for which separate consideration is received – procurement and supply of goods, transportation of goods from vendor, assembly and erection and commissioning – appellant is not a goods transport agency (GTA) as he is not issuing any consignment note – Whether transportation charges received by the applicant are liable to GST, especially when the applicant is not a goods transport agency (GTA)? – N/N. 12/2017 Central Tax (Rate) dated 28/06/2017.
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Held that:- From the co-joint reading of the clauses of the agreement, it can be safely concluded that the contract is a single contract. As such this agreement for Engineering Procurement and construction of Solar Power plant constitute composite supply in the nature of Works Contract. Thus impugned Supplies constit

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T-ARA-36/2017-18/B-43 Mumbai, dt. 04/06/2018 PROCEEDINGS (under section 98 of the Central Goods and Service Tax Act, 2017 and the Maharashtra Goods and Service Tax Act, 2017) 1. The present application has been filed under section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as the CGST Act and MGST Act ] by Dinesh Kumar Agrawal, the applicant, seeking an advance ruling in respect of the following questions : Question No. 1 Whether Standalone Contract of transportation merits classification under Service code 9965 and whether same is exempt under Entry No. 18 of Notification No. 12/2017-CentraI Tax (Rate) dated 28 June 2017? Question No. 2 Whether composite supply of transportation and insurance merits classification under Service code 9965 and whether same is exempt under Entry No. 18 of Notification No. 12/2017-Central Tax (Rate) dated 28th June 2017? Question No. 3 Whether composite supply of 'lo

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ransit insurance' under EPC Contract merits classification under Service code 9965 and whether same is exempt under Entry No. 18 of Notification No. 12/2017-Central Tax (Rate) dated 28 June 2017? At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act/MGST Act would be mentioned as being under the GST Act . 02. FACTS AND CONTENTION – AS PER THE APPLICANT The submissions, as reproduced verbatim, could be seen thus – STATEMENT OF RELEVANT FACTS HAVING A BEARING ON THE OUESTION(S) ON WHICH ADVANCE RULING IS REQUIRED. Description of the Applicant The Applicant, an individual, is proposing

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for services (Service Contract). Under the Supply Contract, each line item is classified under appropriate HSN heading is priced separately and contractor do itemized billing to the customer. Similarly, for each component of the Service Contract, contractor do itemized billing to the customer. Supply Contract and Service Contract have separate consideration but also contains cross-fall breach clause in the contracts which ensure that the performance of both contracts are treated as a single-point responsibility and non-performance of any portion of any contract is treated as a breach of the other contract also. Typically, the scope of works under the EPC Contract and also the Service Contract, inter alia, includes 'loading of goods at the premises of the supplier, transportation in own/hired trucks to the project site, unloading and handling of goods at project site and in-transit insurance' ( SOW ), Standalone Contract: Parties may also have a standalone transportation contrac

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on the questions on which Advance Ruling is required as above. On hearing the applicant it was specifically informed to Shri. Dinesh Kumar Agarwal that his queries were very general and not having any specific details in respect to his proposed transaction and that there was not proposed draft contract. Shri. Dinesh Kumar Agarwal agreed to submit copies of draft contract at the earliest. When the matter was called for Final hearing Shri. Dinesh Kumar Agarwal submitted draft contract which is the nature of EPC contract. Applicant was also informed to submit written say within a week else the final plant as proposed in the EPC contract should not be treated as immovable property. Accordingly additional written submission given by the applicant on 08/05/2018 is as follow- Additional Written submissions given by the applicant on 08.05.2018 A Containing applicants interpretation of Law and Facts is as follows. The Applicant is a prospective contractor undertaking different works for supply

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he relevant clauses in the bid documents: 1.8 of GCC – Works – 'Works' shall mean and include the furnishing of equipment/materials at site and if required, supervision of unloading, storage, handling at site, erection, testing & commissioning and putting into satisfactory operation as defined in the Contract. 1.11 of GCC – Contract Price – The term 'Contract Price' shall mean the lump sum price quoted by the Contractor in his bid with additions and/or deletions as may be agreed and incorporated in the Letter of Award, for the entire scope of the works. 24.1 of GCC – Change of Quantity – During the execution of the Contract, the Owner reserves the right to increase or decrease the quantities of items under the Contract but without any change in unit price or other terms and conditions. Such variations unless otherwise specified in the accompanying Special Conditions of Contract and/or Technical Specifications, shall not be subjected to any limitations for the indivi

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I. Any payment under the Contract shall be made only after the Contractor's price break-up is approved by the Engineer. The aggregate sum of the Contractor's price break-up shall be equal to the lump-sum Contract Price. A Price Breakup over valuing those items of supply which will be shipped first will not be accepted. 34.7.3 of GCC – Inland transportation & Insurance – Inland transportation (including port handing) and inland insurance shall be paid to the Contractor on pro-rata to the value of the equipment received at site and on production of the invoices by the Contractor. However, wherever equipment wise inland transportation charges have been called for in the Bid Proposal Sheets and have been furnished by the Contractor, the payment of inland transportation charges shall be made after receipt of equipment at site based on the charges thus identified by the Contractor in his proposal and incorporated in the Contract. The aggregate of all such pro-rata payments shall

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id Form to indicate the following: i. Ex-works price of the equipment/materials (including tools and tackles etc.) ii. Charges for inland transportation (including port handling) and insurance for delivery of the equipment/materials up to their final destinations. iii. Lump-sum charges towards unloading, storage, insurance, erection, testing & commissioning. iv. Price break-up for spares in line with Clause 23.0 of this Section. v. Sales Tax and any other levies legally payable on the transactions between the Owner and the Bidder, vi. Any other charges as per the requirement of Special Conditions of Contract/Technical Specifications C. Nature and scope of works under EPC Contract for supply of Solar Power Plant The Applicant is a prospective contractor for supply of roof top solar power plant. As part of India's target to achieve 40 Giga Watts (GW) of rooftop photovoltaic (PV) by 2022, the Applicant foresee great demand in the present and future. A rooftop solar plant typically

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ort to the panels. Step 4: Module Installation: Once the module mounting structures are in place, solar modules (panels) are bolted onto the structures. Step 5: Cabling: Solar modules are connected in series with DC cables to the inverter, and with AC cables from the inverter to the evacuation point (customer's LT panel). Step 6: Inverter Connection and Grid Synchronization: Once the installation is ready, the inverter is charged, and begins synchronizing the solar power with the customer's existing electrical grid. Step 7: Seamless Power Distribution: Lastly, seamless power distribution begins as soon as the electrical connections are in place. Sample EPC contract comprises of 34 pages which includes Bill of Quantities. Following are the relevant clauses in the sample EPC contract: 1.1 of the Contract – definitions: Contract Price shall mean the amount to be paid by the Developer to the Contractor for the supply of goods and/or services as stipulated in Clause [please insert].

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quantity of each item delivered at Project Site. Such payment shall constitute full compensation for furnishing all Equipment and labour including testing and all other incidentals necessary to complete the Project. Any quantities which is set out in the Bill of Quantities are estimated quantities and are not to be taken as the actual and correct quantities. The Bill of Quantities list out name of the equipment, specifications, estimated quantity, price per unit and total price. It also lists out installation cost for each activity and transportation charges payable separately. Issues for consideration: D. Immovable property: The supply cannot be characterized as 'works contract' under section 2(119) of the GST Act as the activity does not relates to immovable property. As per Section 2(119) of the Act, works contract means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renova

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ilding on one hand and plant and machinery on another. The Central Board of Excise and Customs (CBEC) vide 37B Order 58/1/2002 – CX dated 15 January 2002 has clarified that if the items assembled or erected at site and attached by foundation to earth cannot be dismantled without substantial damage to its components and thus cannot be reassembled, then the items would be considered as immoveable. In the case of EPC contract for supply of roof top solar power plant, as explained above, solar panels are mounted on steel mounting structures which are mounted on the concrete blocks. Each and every item can be dismantled and disassembled without any damage and relocated to another site. In case of supply to PGCIL, the supply may result in immovable property or may not result in immovable property depending on the scope of works. Scope of supply in case of sub-station may involve erection of buildings, boundary wall and other civil works or it may be purely supply of transformers and switchge

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principal supply. Illustration.- Where goods are packed and transported with insurance, the supply of goods, packing materials, transport and insurance is a composite supply and supply of goods is a principal supply. Applicant understand that where a single price is charged for supply of goods, packing materials, transport and insurance, it would be considered as composite supply and tax will be payable at the rate applicable to principal supply. However, there is ambiguity on taxability when the Applicant charges separate price for transport and insurance. The customer is at liberty to take delivery of goods and transport the same in his own carriage or in a hired one. And therefore, such arrangement should not fall within the mischief of section 2(30) of the Act. F. Taxability If such transporter is considered as GTA, tax would be payable by the customer and if such transporter is not a GTA, no tax would be payable as same is exempt under entry 18 of Notification No. 12/2017-CentraI

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by road except by GTA is exempt (iv) Thus, as the Applicant is not a GTA, no tax should be payable on the transportation charge received from the customer, In light of the above, the Applicant prays the authority to issue rulings. Thus having regards to written submission dt. 08/05/2018 and the draft contract the question raised before this is reframed for consideration as below – Whether transportation charges received by the applicant are liable to GST, specially when the applicant is not a goods transport agency (GTA) . 04. HEARING The case was taken up for Preliminary hearing on dt. 03.04.2018 with respect to admission or rejection of present application when Sh. Dinesh Kumar Agrawal himself appeared. It was specifically informed to Sh. Dinesh Kumar Agrawal that his queries were very general and not having specific details in respect as his transactions and there was no proposed or draft contract. Sh. Dinesh Kumar Agrawal agreed to submit copies of draft contract at the earliest. J

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ts should not be treated as immovable property. Jurisdictional Officer, Sh. R.T. Nikam, Sales Tax Officer appeared and made written submission also which is considered for the fair decision. 05. OBSERVATIONS We have heard Shri. Dinesh Kumar Agarwal on the issue and have carefully gone through the written submission, and the proposed activity represented by draft agreement for Engineering, procurement and Solar Power Plant i.e. roof top photovoltaic (PV). In short, applicants submission is that he is not a goods transport agency (GTA) as he is not issuing any consignment note or the like and hence no tax is payable by virtue of Sr. No. 18 of Notification No. 12/2017 Central Tax (Rate) dated 28/06/2017. Applicant submits that as per clause 10 – which read as follow- The Contractor shall at its own risk and expense, be fully responsible for loading, transportation, delivery to the Project Site and unloading of the Equipment. The cost of transit insurance, if any, should be borne by the co

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obtain the title in goods only upon successful installation and commissioning of the Solar Power Project. 14 Contract Price and Payment: 14.1 Contract Price Payment shall be made at the unit rate stated in the Bill of Quantities at net actual quantity of each item delivered at Project Site. Such payment shall constitute full compensation for furnishing all Equipment and labour including testing and all other incidentals necessary to complete the Project. Any quantities which is set out in the Bill of Quantities are estimated and are not to be taken as the actual and correct quantities. 30.10 Entire Agreement This Agreement, including and together with any related annexures, sets forth the entire agreement and understanding between the Parties with respect to the subject matter hereof and supersedes and cancels all minutes of meeting, term sheet, memorandum of understanding, letter of intent etc. earlier discussion and negotiations of understandings, agreements, representations, warran

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xt issue to be decided is whether this composite supplies constitute Works Contract as defined U/s 2(119) of the GST Act. On this issue applicant submits that the contract is for supply of roof top Solar Plant which involves solar panels which are mounted on steel structures fixed on the roof of building. The steps involved in this regard are already mentioned above in the written submission dated 08/05/2018. He lastly submits that every item can be dismantled and disassembled without any damage and relocated to another site and as such supply of Roof Top Solar Power Plant docs not constitute immovable property. However on actual verifications of terms of agreement given in the draft contract submitted to us we find that the details in contract are not in convergence with the applicant's submissions in above para. We find the details in contract agreement as under Definitions: 'Project means the [ground/rooftop] mounted solar photovoltaic electric generation power plant of MW

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involves civil work which would be very clear from plethora of judgments of Hon. Supreme Court' and Hon. High Courts which help in understanding the term immovable property. One such decision is of the T.T.G. Industries Ltd. v, CCE, (2004) 4 SCC 751. In this case Court has observed as below:- 18. The core question that still survives for consideration is whether (he processes undertaken by the appellant at Bhilai for the erection of mudguns and drilling machines resulted in the emergence of goods leviable to excise duty or whether it resulted in erection of immovable property and not goods . 21. The appellant has placed considerable reliance on the principles enunciated and the test laid down by this Court in Municipal Corpn. of Greater Bombay (1991 Supp (2) SCC 18] to determine what is immovable property. In that case the facts were that the respondent had taken on lease land over which it had put up, apart from other structures and buildings, six oil tanks for storage of petrol

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ting on earth on their own weight without being fixed with nuts and bolts, they have permanently been erected without being shifted from place to place. Permanency is the test. The chattel whether is movable to another place of use in the same position or liable to be dismantled and re-erected at the latter place? If the answer is yes to tile former it must be a movable property and thereby it must be held that it is not attached to the earth. If the answer is yes to the latter it is attached to the earth. 22. Applying the permanency test laid down in the aforesaid decision, counsel for the appellant contended that having regard to the facts of this case which are not in dispute, it must be held that what emerged as a result of the processes undertaken by the appellant was an immovable property. It cannot be moved from the place where it is erected as it is, and if it becomes necessary to move it, it has first to be dismantled and then re-erected at another place. This factual position

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ling it, and then re-erecting it at some other place. Some of the other decisions which we shall hereafter notice clarify the position further. 24. In Quality Steel Tubes (P) Ltd. v. CCE [(1995) 2 SCC 372 : (1995) 75 ELT 17] the facts were that a tube mill and welding head were erected and installed by the appellant, a manufacturer of steel pipes and tubes, by purchasing certain items of plant and machinery in market and embedding them to earth and installing them to form a part of the tube mill and purchasing certain components from the market and assembling and installing them on the site to form a part of the tube mill which was also covered in the process of welding facility. After noticing several decisions of this Court, the Court observed that the twin tests of exigibilily of an article to duly under the Excise Act are that it must be a goods mentioned either in the Schedule or under Item 68 and must be marketable. The word goods applied to those which can be brought to market f

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erned with the exigibility to duly of mono vertical crystallisers which are used in sugar factories to exhaust molasses of sugar. The material on record described the functions and manufacturing process. A mono vertical ctystalliser is fixed on a solid RCC slab having a load-bearing capacity of about 30 tons per square metre. It is assembled at site in different sections and consists of bottom plates, tanks, coils, drive frames, supports, plates, etc. The aforesaid pails were cleared from the premises of the appellants and the mono vertical crystalliser was assembled and erected at site. The process involved welding and gas-cutting. The mono vertical crystal User is a lull structure, rather like a tower with a platform at its summit. This Court noticed I hat marketability was a decisive test for dutyability. It meant that the goods were saleable or suitable for sale, that is to say. They should be capable of being sold to consumers in the market, as it is. without anything more. The Co

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turbo alternator on a concrete base specially constructed on the land cannot be treated as a common base and, therefore, it follows that installation or erection of turbo alternator on the platform constructed on the land would be immovable property, as such it cannot be an excisable goods falling within the meaning of Heading 85 02. In reaching this conclusion this Court considered the earlier judgments of this Court in Municipal Corpn. of Greater Bombay (1991 Supp (2) SCC 18]. Quality Steel Tubes 1(1995) 2 SCC 372: (1995) 75 ELT 17] and Mittal Engg. Works (P) Ltd [(1997) 1 SCC 203 (1996) 88 ELT 622] as also the earlier judgment of this Court in Sirpur Paper Mills Ltd v. CCE [(1998) 1 SCC 400: (1998) 97 ELT 3]. This Court observed: (SCC pp. 35-36. para -14) 14. There can be no doubt that if an article is an immovable property, it cannot be termed as excisable goods 'for purposes of the Act. From a combined reading of the definition of 'immovable property' in Section 3 of t

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he earth like a building or a tree. 27. Keeping in view the principles laid down in the judgments noticed above, and having regard to the facts of this case, we have no doubt in our mind that the mudguns and the drilling machines erected at site by the appellant on a specially made concrete platform at a level of 25 feet above the ground on a base plate secured to the concrete platform, brought into existence not excisable goods but immovable property which could not be shifted without first dismantling it and then re-erecting it at another site. We have earlier noticed the processes involved and the manner in which the equipments were assembled and erected. We have also noticed the volume of the machines concerned and their weight. Taking all these facts into consideration and having regard to the nature of structure erected for basing these machines, we are satisfied that the judicial member of CEGAT was right in reaching the conclusion that what ultimately emerged as a result of pro

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d the drilling machines are really a component of the plant and machinery of the steel plant, but we are satisfied that having regard to the manner in which these machines are erected and installed upon concrete structures, they do not answer the description of goods within the meaning of the term in the Excise Act. Thus, it can be seen that the Hon. Supreme Court while holding the machines as immovable property took into account facts such that the machines could not be shifted without first dismantling it and then re-erecting it at another site. It was also sought to distinguish as to how a concrete base meant just to prevent wobbling of the machine would not place the machine in the category of 'immovable property' as something attached to the earth. We would also look at the decision of the Hon. Supreme Court in the case of Commissioner of Central Excise, Ahmedabad v. Solid and Correct Engineering Works [(2010) 5 SCC 122]. The facts in this case were thus – 3. M/s Solid and

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hasers of such plants. It is common ground that Solidmec advertises its products and undertakes contracts for supplying, erection, commissioning and after-sale services relating thereto. It is also admitted that all the five concerns referred to above are closely held by Shri Hasmukhbhai, his brothers and the members of their families. 5. An inspection of the factories of the respondents by a team of officers from the Central Excise. Preventing Wing, Headquarters, Ahmedabad, led to the issue of a notice dated 30-11-1999 to the four manufacturing units as well as to Solidmec calling upon them to show cause why the amounts mentioned in the said notice be not recovered from them towards Central excise duty. The notice accused the four manufacturing units of having wrongly declared and classified parts and components being manufactured by them as complete plants/systems, even when they were merely parts and components and not machines or plants functional by themselves. The erroneous class

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antly. the end product, namely, asphalt drum/hot mix plants became exigible to Central excise duty, which duty Solidmec had successfully avoided. The notice also proposed to levy penalties upon all the five concerns under appropriate provisions of the Central Excise Act. The Hon. Court has very elaborately dealt with the issue and it would be useful to go through the observations – 22. Section 3 of the Transfer of Property Act, 1882 does not spell out an exhaustive definition of the expression immovable property . It simply provides that unless there is something repugnant in the subject or context. immovable properly under the Transfer of Property Act, 1882 does not include standing timber, growing crops or grass, Section 3(26) of the General Clauses Act. 1897 similarly, does not provide an exhaustive definition of the said expression. It reads: 3. (26) 'immovable properly' shall include land, benefits to arise out of land, and things attached to the earth, or permanently fast

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enjoyment of that to which it is attached. 25. It is evident from the above that the expression attached to the earth has three distinct dimensions, viz. (a) rooted in the earth as in the case of trees and shrubs (b) imbedded in the earth as in the case of walls or buildings or (c) attached lo what is imbedded for the permanent beneficial enjoyment of that to which it is attached. Attachment of the plant in question with the help of nuts and bolts to a foundation not more than 1= feet deep intended to provide stability to the working of the plant and prevent vibration/wobble free operation does not qualify for being described as attached to the earth under any one of the three clauses extracted above. That is because attachment of the plant to the foundation is not comparable or synonymous to trees and shrubs rooted in earth. It is also not synonymous to imbedding in earth of the plant as in the case of walls and buildings, for the obvious reason that a building imbedded in the earth i

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ed in the earth so as to become immovable property is decided on the same principles as those which determine what constitutes an annexation to the land in English law. The English law has evolved the twin tests of degree or mode of annexation and the object of annexation 27. In Wake V. Halt (1883) 8 App Cas 195 Lord Blackburn speaking for the Court of Appeal observed: The degree and nature of annexation is an important element for consideration: for where a chattel is so annexed that it cannot be removed without great damage to the land, it affords a strong ground for thinking that it was intended to be annexed in perpetuity to the land. 28. The English law attaches greater importance to the object of annexation which is determined by the circumstances of each case. One of the important considerations is founded on the interest in the land wherein the person who causes the annexation possesses articles that may be removed without structural damage and even articles merely resting on t

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it is built. 30. The courts in this country have applied the test whether the annexation is with the object of permanent beneficial enjoyment of the land or building Machinery for metal-shaping and electro-plating which was attached by bolls to special concrete bases and could not be easily removed, was not treated to be a part of structure or the soil beneath it. as the attachment was not for more beneficial enjoyment of either the soil or concrete. Attachment in order to qualify the expression attached to the earth, must be for the beneficial attachment of that to which it is attached. Doors, windows and shutters of a house are attached to the house, which is imbedded in the earth. They are attached to the house which is imbedded in the earth for the beneficial enjoyment of the house. They have no separate existence from the house Articles attached that do nor form part of the house such as window blinds, and sashes, and ornamental articles such as glasses and tapestry fixed by tena

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erved that the expression attached to the earth has three distinct dimensions – (a) rooted in the earth as in the case of trees and shrubs (b) imbedded in the earth as in the case of walls or buildings or (c) attached to what is imbedded for the permanent beneficial enjoyment of that to which is attached It has been categorically observed that the attachment of the plant to the foundation at which it rests does not fall in the third category attached to what is imbedded for the permanent beneficial enjoyment of that to which it is attached], for the reason that an attachment to fall in the third category it must be for permanent beneficial enjoyment of that to which the plant is attached. The Hon. Court even went on to distinguish and record with approval earlier decisions on the issue of 'immovable property'. We may have a look at the same, too. 33. In Sirpur Paper Mills Ltd. (1998) 1 SCC -400] this Court was dealing with a near similar situation as in the present case. The qu

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y and also fur sec win Thai will not make the water pump an item of immovable property. Some of the components of the water pump may even be assembled on site. That too will not make any difference to the principle. The lest is whether the paper-making machine can be sold m the market The Tribunal has found as a fact that it can be sold, in view of that finding, we are unable to uphold the contention of the appellant that the machine must be treated as a part of the immovable property of the Company. Just because a plant and machinery are fixed in the earth for better functioning, it does not automatically become an immovable property 38. Reliance was placed by Mr. Bagaria upon the decision of this Court in Quality Steel Tubes (P) Ltd. v. CCE [(1995) 2 SCC 372 (1995) 75 ELT 17] and Mittal Engg. Works (P) Ltd. v. CCE [(1997) 1 SCC 203 : (1996) 88 ELT 622]. In Quality Steel Tubes (P) Ltd. case [(1995) 2 SCC 372 (1995) 75 ELT 17] this Court was examining whether -the tube mill and welding

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273]. the facts and circumstances of each case shall have to be examined for determining not only the factum of fastening/attachment to the earth but also the intention behind the same. 40. In Mittal Engg. Works (P) Ltd. case [(1997) 1 SCC 203 : (1996) 88 ELT 622] this Court was examining whether the mono vertical crystallisers erected and attached by a foundation to the earth at the site of the sugar factory could be treated as goods within the meaning of the Central Excise Act, 1944. This Court on facts noted that mono vertical crystallisers are fixed on a solid RCC slab having a load bearing capacity of about 30 tonnes per square metre and are assembled at site with bottom plates, tanks, coils, drive frames, supports, plates, distance places, cutters, cutter supports, tank ribs, distance plate angles, water tanks, coil extension pipes, loose bend angles, coil supports, railing stands, intermediate platforms, drive frame railings and flats, oil trough, worm wheels, shafts, housing,

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n these appeals as we are not dealing with the case of a machine like mono vertical crystallisers which is permanently embedded in the structure of a sugar factory as was the position in Mittal Engg. Works (P) Ltd. case [(1997) 1 SCC 203 : (1996) 88 ELT 622]. The plants with which we are dealing are entirely over ground and are not assimilated in any structure. They are simply fixed to the foundation with the help of nuts and bolts in order to provide stability from vibrations during the operation. 42. So also in T.T.G. Industries Ltd. v. CCE [(2004) 4 SCC 751: (2004) 167 ELT 501], the machinery was erected at the site by the assessee on a specially made concrete platform at a level of 25 ft height. Considering the weight and volume of the machine and the processes involved in its erection and installation, this Court held that the same was immovable property which could not be shifted without dismantling the same. 43. It is noteworthy that in none of the cases relied upon by the asses

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which there is no assimilation of the machine with the structure permanently, would stand on a different footing. 44. In the instant case all that has been said by the assessee is that the machine is fixed by nuts and bolts to a foundation not because (he intention was to permanently attach it to the earth but because a foundation was necessary to provide a wobble free operation to the machine. An attachment of this kind without the necessary intent of making the same permanent cannot, in our opinion, constitute permanent fixing, embedding or attachment in the sense that would make the machine a part and parcel of the earth permanently. In that view of the matter we see no difficulty in holding that the plants in question were not immovable property so as to be immune from the levy of excise duty. Our answer to Question 1 is accordingly in the affirmative. Thus, from the judgments referred above we find clearly that the intent of the person at the time of erecting and operationalizing

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2018 (7) TMI 1531 – CESTAT HYDERABAD – TMI – Reverse Charge Mechanism – Classification of services are not clear – Demand is sought to be made on the ground that there is a difference between the ledger amounts and the amounts reflected in the Service Tax returns filed by the appellant – Held that:- Hon’ble Supreme Court in the case of Ranbaxy Laboratories Limited vs. Union of India [2011 (10) TMI 16 – SUPREME COURT OF INDIA], held that it is a well settled proposition of law that a fiscal legislation has to be construed strictly and one has to look merely at what is said in the relevant provision; there is nothing to read in; nothing to be implied and there is no room for any indentment”. The order fastening a liability on the assessee has to pass this test.
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On going through the Order-in-Original, it is found that Ld. Commissioner has not examined as to how each of the items of expenditure discussed above amount to services received by the appellant in India and how they are ch

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with a specific direction to compute the demand after specifying how each of the items of the expenditure are chargeable to service tax – appeal allowed by way of remand. – Appeal No. ST/31175-31177/2016 – A/30677-30679/2018 – Dated:- 4-6-2018 – Mr. M.V. RAVINDRAN, MEMBER (JUDICIAL) And Mr. P.V. SUBBA RAO, MEMBER (TECHNICAL) Shri Y. Srinivasa Reddy, Advocate for the Appellant. Shri Arun Kumar, Dy. Commissioner/AR for the Respondent. [Order per: P. VENKATA SUBBA RAO] 1. These appeals are filed by the appellant against the Order-in-Original passed by the Commissioner of Service Tax, Hyderabad. 2. The appellants are manufacturers of pharmaceutical drugs with manufacturing units located across India and also outside India. They have branches and associate companies in countries such as Mexico, Russia, Dubai and Vietnam. These Branches and the Associate companies are located in their own premises and maintain their infrastructure with manpower and are registered as permanent establishments

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ces are chargeable to service tax under Reverse Charge Mechanism and the appellant had not discharged the service tax on these services for which he had paid. As they have not disclosed these amounts in their Service Tax Returns, extended period of demand was invoked and interest under section 75 and penalties under sections 76 & 77 were also proposed to be imposed on the appellant. After following due process of law, Ld. Commissioner confirmed the demand and imposed penalties and interest upon them. The current appeals are against these orders of Ld. Commissioner. Earlier, vide Miscellaneous Order No. M/30081-30084/2018, dated 25.04.2018, the appellant s request for an early hearing was allowed as the amount of service tax liability confirmed is substantial. Accordingly, the matter was listed for hearing today. 3. Heard both sides and perused the records. 4. The appellants have submitted a list of 91 expenses incurred by them on various items on which the service tax is proposed t

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ceipt of IPR through their branch offices. The appellant argues that these are not IPR charges and no IPR service is received in India. In fact, these are the amounts which they have paid to the Governments of those countries to register their intellectual proprietary rights in those countries. Since registration is a statutory function done by the Governments, these services are covered by the negative list of services under Section 66 D of chapter-V of the Finance Act, 1994. It is his further submission that during the relevant period, all services rendered by the government or local authority excluding some specified in that section were exempted. It is only w.e.f. 14.05.2015, the statutory definition for Government has been introduced through Section 65 B(26A) restricting the scope of government to the departments of Central Government, State Governments and Union Territories. Therefore, these services rendered by the respective governments and for which they have aid, appropriate

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so much amount on these charges and no claim for relief is made out by the appellant. The appellants argument is that salaries and other office expenditure are not liable to tax and at any rate without specifying the authority of law, no demand of service tax can be made on these amounts. (f) Sl.No. 35 to 45: These expenses pertain to Clinical Test Charges, Consultancy Charges, Consumption of innovatory samples and testing charges. The department sought to classify the clinical test charges as technical testing and analysis service and Scientific Consultancy Service and had not made any specific classification of the remaining services. Appellant argues that these services were received and consumed outside India and hence no service tax needs to be paid on them. (g) Sl.No. 46 to 91: These are pertain to variety of charges such as Factory Audit Expense, Translation Charges, Audit Expenses, Bank Interest, Factory Maintenance, Repair and Maintenance of computers, Membership and subscript

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ble service has been provided is not correct. In respect of the demand under the category of Business Auxiliary Service, it is alleged by the appellant that the amounts taken by the department for some orders were wrong in the first notice. In respect of one entry head under the head audit expenses , demand was made on an amount of ₹ 31,97,77,299/- whereas the actual amount was only ₹ 3,19,77,299/- thus inflating the amount by ₹ 28.00 crores. They further argued that the department found a difference between the ledger amounts and the ST-3 returns because the ledger amounts reflected the provision made whereas the liability to pay service tax in the case of reverse charge mechanism is on making the payment. The amounts mentioned in the Ledger would include the amounts paid, amounts for which provision was made, amounts relating to past period and amounts which are written off. Therefore, the demand of service tax simply based on the Ledger amount is incorrect. 6. The

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rsed by them. The department s proposal to charge these as business promotion expenses and charge them under reverse charge mechanism is not correct. The appellant relied on the following case laws: (a) Milind Kulkarni and others vs. CCE, Pune [2016-TIOL-709-CESTATMumbai] (b) Genym biotech vs. CCE,Nasik [2016(42)STR 918 (Tri.-Mum.] (c) KPIT Cummins Info System Ltd. CCE Pune [2013-TIOL-1568- CESTAT-Mumbai] (d) CCE Bangalore vs. Pragati Concrete Products Pvt. Ltd [2015(322)ELT 818 (SC)] (e) Sunil Forging & Steel Industries vs. CCE, Belapur [20176(332)ELT 341 (Tri.-Mum.)] (f) CCE Bangalore vs. MTR Foods Ltd [2012(282) ELT 196 (Kar.)] (g) Trans Engineers India Pvt. Ltd. vs. CCE, Pune [2015(40)STR 490 (Tri.-Mum.)] 8. Ld. DR reiterated the arguments made in the Orders-in-Original and vehemently opposed the appeal. It is his submission that the appellant was bound to have filed the returns reflecting the actual amount of services and the service tax liability thereon and paid the service

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ices. 9. We have considered the arguments on both sides and perused the records. The demand is sought to be made on the ground that there is a difference between the ledger amounts and the amounts reflected in the Service Tax returns filed by the appellant. The amounts in the Ledger reflects the amounts transferred by the appellant to their branch offices or associate companies in foreign currency. The Department viewed these as payments made for services rendered by the overseas service provider and consumed by the appellant in India. The appellant argues that the expenses included several expenses which are the office expenses including salaries incurred by their branch offices which are being supported by the appellant. It is also their argument that there were several services for which no classification was made by the department, hence it is impossible to understand and show why the service tax under reverse charge mechanism is not payable on such expenses. 10. As has been held b

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liable to charge to service tax under reverse charge mechanism. It has been held in the case of DHL Express India Pvt. Ltd. (supra) that consideration received from a recipient of service for the services rendered by the provider alone is taxable and the demand for alleged short paid tax must be based on a finding that a specific taxable service has been provided as agreed to be provided and on the consideration that was paid or payable by the recipient of the service to the provider of the service. Similarly, in the present case, where the appellant is supposed to have received the services and is liable to pay service tax under reverse charge mechanism, it is essential that the department say what services were received by the appellant and how they were unclassifiable and how they were liable to be charged under reverse charge mechanism and compute their tax liability accordingly. This is an original work to be done with respect to each of the specific items of expenditure on which

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GST – States – 11/2018 – Dated:- 4-6-2018 – GOVERNMENT OF TELANGANA COMMERCIAL TAXES DEPARTMENT TGST Notification No. 11/2018 CCT s Ref No. A(1)/115/2017, Dt. 04-06-2018 Sub:- Extension of Time limit for filing FORM GSTR-6. In exercise of the powers conferred by sub-section (6) of Section 39 read with Section 168 of the Telangana Goods and Services Tax Act, 2017 (23 of 2017) (hereinafter referred to as the said Act) and in supersession of Commissioner of State Tax Notification No. 6/2018-State

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2018 (6) TMI 676 – MADRAS HIGH COURT – TMI – 100% EOU – Refund of CENVAT credit – denial of refund on the ground of Non-Registration of premises Held that:- Reliance placed in the case of MPORTAL INDIA WIRELESS SOLUTIONS (P.) LTD. VERSUS COMMISSIONER OF SERVICE TAX [2011 (9) TMI 450 – KARNATAKA HIGH COURT], where it was held that Registration not compulsory for refund – refund allowed – appeal dismissed – decided against Revenue. – C.M.A. No. 1052 of 2018 Dated:- 4-6-2018 – S. Manikumar And V. Bhavani Subbaroyan, JJ. For the Appellant : Mrs. Aparna Nandakumar JUDGMENT ( Judgment of this Court was delivered by S. Manikumar, J. ) Civil Miscellaneous Appeal is directed against the order of the Customs Excise and Service Tax Appellate Tribunal, South Zonal Bench, Chennai (CESTAT) dated 31.07.2017 in Final Order No.41584 of 2017. 2. It is the case of the appellant that M/s.BNP Paribas Sundaram Global Securities Operations Private Limited, Chennai, respondent is an 100% EOU, engaged in pro

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44 04 Unregistered premises at Mumbai 86947 The premises were not registered 05 Unregistered premises at Principal Tower, College Road, Chennai 11293 06 Services received at 4th and 5th Floor of Menon Eternity, New Door No.165, St.Mary's Road, Alwarpet, Chennai-18 1486920 The premises were not registered at the time of export but subsequently obtained Registration. 07 Services received at International Tech Park Unit No.1 to 4, 11th Floor, Taramani Chennai. 1144872 3. Aggrieved by the above orders, the respondent filed an appeal before Commissioner (Appeals). The first appellate authority, Commissioner (Appeals) vide combined Order-in-Appeal No.24/2016 dated 18.02.2016 set aside a portion of the order of the original authority, and allowed refund as detailed above: S. No. Services Sanctioned by Commissioner (Appeals) Sl.No. As in table at para 2 above. 01 Car Parking charges 111240 2 02 Services received at 4th and 5th Floor of Menon Eternity, New Door No.165, St.Mary;s Road, Alwar

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n respect of Car parking charges, Commissioner (Appeals) observed that the parking area cannot be considered as a separate area and it is a part of the premises occupied by the respondent. He also held that the service tax paid on the rental charges is eligible for CENVAT credit, then service tax paid on the car parking charges is equally eligible for CENVAT credit and set aside the disallowance of CENVAT credit and upheld the disallowance of CENVAT credit in respect of Event Management service. 6. While the decision of the Commissioner (Appeals) allowing the credit in respect of Car Parking Charges was found acceptable, the decision in respect of credit availed on the inputs received in the premises which was not registered prior to export, but subsequently obtained Registration was found to be not legally correct and hence the Department filed an appeal before CESTAT. 7. Contentions of the appellant herein were not accepted by CESTAT, Madras and vide FO No.40778 dated 22/05/2017 dism

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follows: 7.2. From the grounds of appeal and statement of facts at page 17 of the appeal folder, it is seen that Revenue is aggrieved that the Commissioner (Appeals) has not appreciated the judgment of the Hon'ble Madras High Court in the case of Commissioner of Central Excise, Coimbatore Vs. Sutham Nylocots as reported in 2014(306) ELT 255 (Mad.). No doubt, the Hon'ble High Court in the said judgment had ruled that credit accrued can take effect only after the date of registration, however, the Hon'ble High Court in the subsequent judgment passed on 10.4.2017 in the case of Scioinspire Consulting Services, referred to supra, have distinguished the facts contained in Sutham Nylocots observing that the said case was dealing with the provisions of Section 11AB of the Central Excise Act, 1944 and that the only ground rejection of the refund therefor was that the additional building was not registered with the concerned authority. The Hon'ble High Court agreeing with the v

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es, that has been pointed out in the present case, we follow the ratio already laid down in the above said final order of the tribunal and dismiss the appeal of the department." 8. Aggrieved over the same, instant Civil Miscellaneous Appeal is filed on the following substantial questions of law. 1. Whether the decision of Customs, Excise & Service Tax Appellate Tribunal, South Zonal Bench, Chennai (CESTAT for short) in allowing refund of CENVAT credit even without registration is correct? 2. Whether CESTAT, i.e. 1st respondent is erred in not considering the safeguards, conditions and limitations as stipulated in the Appendix to the Notification No.27/2012-CE(NT), dated 18.06.2016 . 9. Supporting the prayer sought for, Ms.Aparna Nandakumar, learned counsel for the revenue submitted that: (i) Registration is an act by which every manufacturer / assessee / service provider comes under the ambit of Central Excise Act, 1944 / Finance Act, 1994. In order to avail any substantive be

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ification No.5/2006-CE(NT) dated 14.03.2006 {Condition No.3(b)} where in it is stated that refund of CENVAT credit shall be allowed only in respect of the registered premises of the service provider from where the output services are exported. (iv) It has been held that registration was not a pre-requisite to claim refund under Rule 5 of CENVAT Credit Rules, 2004. However, the Larger Bench of CESTAT, New Delhi in the case of Steel Strips Vs. CCE, Ludhiana 2011 (269) ELT (Tri-Del) vide para 5.16 has categorically stated that Modvat law has codified procedure for adjustment of duty liablity against Modvat Account. That is required to be carried out in accordance with law and unadjusted amount is not expressly permitted to be refunded. In absence of express provision to grant refund, that is difficult to entertain except in the case of export. There cannot be presumption that in the absence of debarment to make refund, in other cases that is permissible. Refund results in outflow from tre

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ror by stating that the respondent was entitled to credit and refund in view of non-taxability of export service. This is for the reason that Rule 4 of Export of Service Rules, 2005 permitted a service provider to export services without payment of service tax, and thus, there is liability to pay service tax on export of service, but for this rule. Hence, for export of service by a service provider, registration is a sine qua non for procedural and substantive compliance. (vi)The judgment of the Hon'ble High Court of Madras in the case of Commissioner of Service Tax, Chennai-III Vs. M/s.Scionispire Consulting Services (India) P Ltd., applied by CESTAT for deciding the appeal in favour of the respondent was accepted by the department due to monetary limit and not on merits, and therefore, it is humbly submitted that the ratio of the said judgment should not have been taken as a binding precedent in view of Section 35R (3) of the Central Excise Act, 1944 read with Section 83 of the F

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ny credit it would accrue only subsequently to the date of the registration with the Department'. Hence, the refund of unutilized input CENVAT credit taken towards rendering the input services availed and used in providing the taxable output services exported, would not arise prior to the date of registration. 10. Heard Ms.Aparna Nandakumar, learned senior counsel for the revenue and perused the materials available on record. 11. Going through the material on record, and adverting to the submissions duly supported by the grounds of challenge, we are of the view that the issue is no longer res integra and is covered by a decision of this Court in Commissioner of Services Tax-III, Chennai Vs. M/s. Scioinspire Consulting Services India Private Limited, Chennai and another, in C.M.A.No.860 of 2017, wherein the following substantial questions of law were framed:- "1. Whether the decision of CESTAT i.e. Respondent No.1 in allowing refund of Cenvat credit even without registration is

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minds, a bare perusal of the said notification would show that it only sets out the procedure for claiming refund of unutilized input service credit. The only clause of the notification, which, perhaps, the Department could have relied upon, is Clause 3, which, to our minds, has no bearing on the issue arising in the instant case. For the sake of convenience, the relevant part of the said notification is extracted hereafter : "Notification No.05/2006-Central Excise (N.T.) 14th March 2006 G.S.R. (E) In exercise of the powers conferred by rule 5 of the CENVAT Credit Rules, 2004 (hereinafter referred to as the said rules), and in supercession of the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.11/2002 – Central Excise (NT), dated 1st March, 2002, published in the Gazette of India Extraordinary, vide number G.S.R.No.150(E), dated 1st March 2002, the Central Government hereby directs that refund of CENVAT credit shall be allowed in res

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uated, along with a copy of the invoice and a certificate from the bank certifying realization of export proceeds." 7.2. A bare perusal of the clause would show that in so far as the provider of output services is concerned, for making an application for refund of CENVAT Credit, he is required to file an application in the prescribed form, i.e., Form A, which is annexed to the notification, and the said application is required to be made to the Deputy Commissioner of Central Excise, or, the Assistant Commissioner of Central Excise, as the case may be. In so far as the jurisdiction of the concerned Officer is concerned, the same is fixed, in consonance with the location of the registered premises of the service provider, from which, the output service are exported. Furthermore, the application is required to be accompanied with a copy of the relevant invoices and a certificate from the bank, indicating therein, the realization of export proceeds. 7.3. Apart from the aforesaid, ther

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laim relates, i.e., Maximum refund ? total CENVAT credit taken on input services during the given period X export turnover / Total turnover ………" 7.5. Therefore, there is no merit in the submission advanced on behalf of the Revenue that the said notification would disentitle the claim of the Assessee qua refund of CENVAT credit." 13. On Questions of Law 1 and 3, the Hon'ble Division Bench, at paragraph Nos.8.4 to 8.7, considered thus "8.4.What is relevant to note is that Rule 5 of the 2004 Rules does not stipulate registration of premises as a necessary prerequisite for claiming a refund. 8.5.In so far as the Assessee in this case, is concerned, it had obtained registration of its premises way back on 23.01.2009. The record shows that allegation of non-registration of premises relates to another building, which was taken on lease by the Assessee and is located in Alwarpet, Chennai. Concededly, services were exported to a overseas Company, from this building whic

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and was located at Alwarpet, Chennai", was not registered. 14. After considering the provisions, relevant notifications and decisions in M/s.mPortal India Wireless Solutions Private Limited V. Commissioner of Service Tax, Bangalore, reported in 2012 (27) S.T.R.134 (Kar.); in Commissioner of Service Tax V. Tavant Technologies India Private Limited, reported in 2016 (3) TMI 535; in Commissioner, Service Tax Commissionerate V. Atrenta India Private Limited, reported in 2017 (2) ADJ 590; and in Commissioner of Central Excise, Coimbatore Vs. Sutham Nylocots, reported in 2014 (306) E.L.T. 255 (Mad), a Hon'ble Division Bench, answered the above said substantial questions of law, raised therein, against the revenue. 15. As facts and grounds of challenge are duly covered by the abovesaid decision, we have no hesitation in dismissing the instant Civil Miscellaneous Appeal, holding the substantial questions of law against the revenue. Civil Miscellaneous Appeal is dismissed. No Costs. –

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2018 (6) TMI 247 – CESTAT CHENNAI – TMI – GTA Service – CENVAT credit – input services – Outward transportation of goods up to the buyer’s premises – period involved is after 01.04.2008 – whether the appellant is eligible to avail the Cenvat Credit of service tax paid on the GTA service received by them for outward transportation of final products from the factory gate up to the premises of the buyer when the sales are on FOR basis? – penalty.
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Held that:- The said issue has been decided in the case of M/s. Ultratech Cement Ltd. [2018 (2) TMI 117 – SUPREME COURT OF INDIA] by the Hon’ble Apex Court, wherein it has been held that credit is eligible up to 01.04.2008 and after such date, the assessee is not eligible for credit – credit not allowed.
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Penalty – Held that:- Taking into consideration that the issue was under litigation and was in favour of assessee at the Tribunal level as also decided by various High Courts and got settled only by the decision of the Hon’ble Apex C

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e, show-cause notices were issued, proposing to recover the wrongly availed credit along with interest and for imposing penalties. After due process of law, the original authority confirmed the demand, interest and penalties. In appeal, the Commissioner (Appeals) upheld the same. Hence, these appeals. 3. On behalf of the appellant, the learned Counsel Ms. S. Yogalakshmi submitted that the appellants had sold the manufactured products on FOR (Destination) basis, as the appellant had an obligation to deliver the goods at the customer s premises and the ownership of the said goods got transferred to their client only at that stage. The price quoted to their clients is inclusive of the freight charge incurred by the appellant for the outward transportation. The appellant had paid excise duty on the assessable value, which is inclusive of the freight charges thus incurred. It is submitted that the actual credit availed by the appellant pertains to service tax paid on 25% of the gross amount

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th effect from 01.04.2008, an amendment has been made by notification 10/2008 CE NT dated 01.03.2008, wherein the words clearance of final products from the place of removal , is substituted with the words clearance of final products up to the place of removal . For the period prior to the above amendment, the issue is settled by the judgement in the case of CCE Vs. ABB Ltd., {2011 (23)STR 97 Kar.}. It was held therein that the expression clearance of the final products from the place of removal would cover such transportation services up to the customer s place, and the same cannot be restricted by the expression outward transportation up to the place of removal . The judgement has also made it clear that the position post 01.04.2008 is not examined. Hence, when the definition has been amended from 01.04.2008, restricting the credit entitled for clearance of final products up to the place of removal, read with outward transportation up to the place of removal, would lead to the meanin

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sportation, the CBEC came out with another Circular No. 988/12/2014 dated 20.10.2014. The Circular clarified that the place where sale has taken place or when the property, in goods, passes from the seller to the buyer, is the relevant consideration to determine the place of removal. The effect of the above Circulars is that if the transfer of property in the goods happens to be at the buyer s place, in terms of the provisions of the Sale of Goods Act, 1930, then such buyer s place would be the place of removal, and, hence, any service tax paid on GTA services availed for transporting the goods till the buyer s premises would be eligible for Cenvat Credit. 5. That, while this being so, it is submitted by her that the Hon ble Apex Court in the case of Ultratech Cement Ltd. (supra) has not noticed that the clarification contained in the Circular has got nothing to do with the amendment. The Circular only clarifies that the buyer s place can become place of removal if the three conditions

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R, Shri K.P. Muralidharan, supported the findings in the impugned order. He submitted that the issue stands settled by the decision in the case of M/s. Ultratech Cement Ltd. 2018-TIOL-42 SC-CX. 7. Heard both sides. 8. The period involved is after 01.04.2008. The issue involved in both the appeals is whether the appellant is eligible to avail the Cenvat Credit of service tax paid on the GTA service received by them for outward transportation of final products from the factory gate up to the premises of the buyer when the sales are on FOR basis. The said issue has been decided in the case of M/s. Ultratech Cement Ltd. by the Hon ble Apex Court, wherein it has been held that credit is eligible up to 01.04.2008 and after such date, the assessee is not eligible for credit. Though the learned Counsel for appellant has put forward lengthy arguments in the written submissions, I am afraid the same does not find any merit in view of the decision of the Hon ble Apex Court in the case cited supra

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Goods and Services Tax – F. No. 31013/16/2017-ST-I-DoR – G.S.R. 524(E) – Dated:- 4-6-2018 – MINISTRY OF FINANCE (Department of Revenue) NOTIFICATION New Delhi, the 4th June, 2018 G.S.R. 524(E).-In exercise of the powers conferred by section 53 read with section 17 of the Central Goods and Services Tax Act, 2017 (12 of 2017), sections 17 and 18 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017) and section 21 of the Union Territory Goods and Services Tax Act, 2017 (14 of 2017), the Central Government hereby makes the following further amendments in the Goods and Services Tax Settlement of Funds Rules, 2017, namely:- 1. (1) These rules may be called the Goods and Services Tax Settlement of Funds (Second Amendment) Rules, 2018. (

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Goods and Services Tax – Started By: – YUWRAJ KOTHARI – Dated:- 2-6-2018 Last Replied Date:- 7-6-2018 – Dear Experts,My Client has a business of Cement (Reseller). Whereas Company send Cement bags via rail to a particular destination. After that Company provide Transport facility to send cement bags to client but during the transit client request transporter to send Cement bags directly to the 3 customer situated at three different places. My queries is whether we have to generate e way bill and if yes then HOW or Transporter will take care of such transaction. – Reply By YAGAY and SUN – The Reply = One can transport goods through different modes of transportation – Road, Rail, Air, Ship. However, PART-B of e-way bill have to be updated wi

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ucks(16 km distance). In that case how to update part-B of e-Way bill. – Reply By YAGAY and SUN – The Reply = Where the goods are transported by railways or by air or vessel, the Part B of the e-way bill can be updated either before or after the commencement of movement. But, where the goods are transported by railways, the railways shall not deliver the goods, unless the e-way bill as required under these rules is produced to them, at the time of delivery.One e-way bill can go through multiple modes of transportation before reaching destination. As per the mode of transportation, the EWB can be updated with new mode of transportation by using Update Vehicle Number .Let us assume the goods are moving from Cochin to Chandigarh through road,

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Goods and Services Tax – GST – Valuation of a supply – Goods transferred to branches in another state – recipient eligible for full input tax credit – assessee has the option to choose the value decla

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Goods and Services Tax – GST – By: – CA.Ram Akshya – Dated:- 2-6-2018 – 1. Introduction Maintenance of books of account and documentation is one of the important compliance requirement under any tax law. The tax payer or the assessee is required to record all transactions in his books of account and keep all the documents entered into for any transaction in safe custody up to a particular period of time. Different tax law specifies different period for which records, documents etc. should be preserved. Further, the correct assessment, audit, verification of compliances are based on proper maintenance of books of accounts and records keeping. Goods and Service Tax (GST) is mainly self-assessment based system where the registered person is required to assess his liability and pay it by filing applicable returns. Off course, the basis for this is underlying records for a particular transaction. The GST law has also prescribed documents required to be issued by different kinds of supplier

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or paper include books of account, deeds, vouchers, writings, documents, minutes and registers maintained on paper or in electronic form. As per Section 2(13) of Companies Act 2013, books of account includes records maintained in respect of- (i) all sums of money received and expended by a company and matters in relation to which the receipts and expenditure take place; (ii) all sales and purchases of goods and services by the company; (iii) the assets and liabilities of the company; and (iv) the items of cost as may be prescribed under section 148 in the case of a company which belongs to any class of companies specified under that section. As per Section 2(36) of Companies Act 2013, document includes summons, notice, requisition, order, declaration, form and register, whether issued, sent or kept in pursuance of this Act or under any other law for the time being in force or otherwise, maintained on paper or in electronic form. Basis the above, it may be summarised that the document

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ained electronically, a log of every entry edited or deleted is required to be maintained. Further, proper electronic back up of all the records is required to be maintained and preserved so that in case of destruction of such records due to any reason, it may be restored within a reasonable period of time. The person maintaining electronic records is to submit the relevant records, documents in hard copy or in electronic readable format, duly authenticated by him to the appropriate authority if demanded. Further, the details of files stored electronically, password of such files and explanation for codes used etc. is also required to be provided on demand. 4. Location of maintenance of books of accounts The GST law requires every registered person to maintain the books of accounts at his places of business respectively. In case, there is multiple business locations in a State, the books of accounts pertaining to principal place of business is required to be kept at principal place of

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nt of: Manufacture of goods To maintain monthly production accounts showing quantitative details of raw material or services used in the manufacture and quantitative details of goods so manufactured including waste and by-products Inward & outward supply of goods or services Stock of goods Input tax credit availed Output tax payable and paid It should contain the details of tax payable including payable as per Section 9(3) & Section 9(4), tax collected and paid, input tax, input ta credit claimed together with a register of tax invoice, credit notes, debit notes, delivery challan issued or received during any tax period Import or export Supplies attracting payment of tax on reverse charge basis Relevant documents including invoices, bills of supply, delivery challans, credit notes, debit notes, receipt vouchers, payment vouchers and refund vouchers A separate account of advances received, paid and adjustments made thereto Stock of goods received and supplied It should contain p

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ame till the expiry of seventy two months (six years) from the due date of furnishing the annual return. The due date of filing of annual return is 31st December from the end of the relevant financial year. Thus, the books of accounts or other records must be preserved at least seventy nine months from the end of the relevant financial year. In case, there is any appeal or revision or investigation or any other proceeding/case going on, the books of accounts and other records pertaining to such proceeding is required to be preserved for a period of one year after final disposal of such proceeding/case or till the expiry of seventy two months from 31st December of relevant financial year, whichever is later. 7. Conclusion From the above, it is derived that the GST law has extensive accounting and record keeping requirements. However, the more cumbersome excise law requirements applicable for manufacturing entities have been removed under GST law. So, it is the duty of professionals to u

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Goods and Services Tax – Started By: – Riya Jain – Dated:- 2-6-2018 Last Replied Date:- 2-6-2018 – Sir In Gst refund form of inverted duty structure ,where output tax is 12% and 18% and input tax 18% and 28% , it asks for turnover of inverted supply of goods, in that will only be 12 percent will be taken or 12% and 18‰ both turnover.Also if only 12% turnover is to be taken, then it becomes contradictory with gst user manual where it says u have to input the sales as mentioned in column 3

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GST revenue collection for May 2018 – Goods and Services Tax – GST – Dated:- 1-6-2018 – GST revenue collection for May 2018 Rs 94,016 Crore of total gross GST revenue collected in May2018 Gross revenue collection in may is much higher than the monthly average of GST collection in the last financial year The total gross GST revenue collected in the month of May2018 is Rs. 94,016 crore of which CGST is ₹ 15,866 crore, SGST is ₹ 21,691 crore, IGST is ₹ 49,120 crore (including ₹ 24,447 crore collected on imports) and Cess is ₹ 7,339 crore (including ₹ 854 crore collected on imports).The total number of GSTR 3B Returns filed for the month of April up to 31st May, 2018 is 62.47 lakh. The total revenue earned by

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Goods and Services Tax – Classification of supply – Activity of Printing content supplied by the customers on photographic paper – Activity is in the nature of supply of service – classifiable under S

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Goods and Services Tax – Started By: – Yugank Goel – Dated:- 1-6-2018 Last Replied Date:- 8-6-2018 – Dear All,Suppose we have not depsited tax on time then what is the interest rate that we will be liable to pay.Is it 18% or 24%??If 18%, then when we got liable for 24%. – Reply By YAGAY and SUN – The Reply = Interest on Late GST PaymentAn interest of 18 percent is levied on the late payment of taxes under the GST regime. The interest would be levied for the days for which tax was not paid after

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Goods and Services Tax – Started By: – Yugank Goel – Dated:- 1-6-2018 Last Replied Date:- 7-6-2018 – Dear All, There is a issue which I had discussed with many consultants but I found that this is debatable as every consultant comes with their own view which is different from others. Please help me to solve this. We have not submitted the GSTR 3B returns for past 3-4 months but we have deposited the tax amount timely. We just want to know that when we will file the return, shall we have to pay interest also on amount which we have already paid in advance as we have not setoff our GST liability or there will be only penalty for late filing. – Reply By YAGAY and SUN – The Reply = CBEC withdraws the reduction in Late fees for GSTR-5A charged

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re any provision that tax paid in advance without being setoff the liability in GSTR3B still be liable for interest for the output liability????? – Reply By Praveen Nair – The Reply = Dear Yugank If there are no change in the Output liability and the amount paid advance (credit / cash) is unutilized as on the date of filing the GSTR3B return, which you desire to file with the late payment fees, it is a matter of representation to the right authority. No interest is leviable. Regards Pravin Nair – Reply By Mahadev R – The Reply = In GST law, tax amounts are deemed to be paid only when they are adjusted with the liability in liability register which can happen only on filing the return. Just deposit without filing return would attract interes

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Customs – 15/2018 – Dated:- 1-6-2018 – OFFICE OF THE COMMISSIONER OF CUSTOMS CITY CUSTOMS COMMISSIONERATE, P.B. NO. 5400, C.R. BUILDING QUEEN'S ROAD, BENGALURU 001560. C.NO.VIII/09/ 09/2018 City Cus. Tech Dated: 01.06.2018 PUBLIC NOTICE NO. 15/2018 Subject: Sanction of pending IGST refund claims where the records have not been transmitted from the GSTN to DG Systems Reg. Attention of all Customs Brokers, Exporters, Importers, Members of the Trade and other stake holders is invited to Board&

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2018 (7) TMI 1495 – AUTHORITY FOR ADVANCE RULINGS HARYANA – 2018 (15) G. S. T. L. 107 (A. A. R. – GST) – Composite supply of services – nature of supply – rate of tax – Exam Support Services – place of supply – conducting of exams – applicant is a subsidiary of the British Council which is the U.K.'s International Organisation for cultural relations and educational opportunities. International English Language Testing System – Applicant has agreed to provide ‘Exam Support Services’ and Student Facilitation Services to BCUK.
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Whether alt the activities involved in the exam support services constitute a mixed supply or a composite supply?
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What will be rate of GST applicable on these exam support services?
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What is the place of supply of these exam support services rendered by the Applicant BCKU?
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Held that:- A perusal of the pan-A, B & C of schedule-I appended to the copy of proposed agreement submitted on record, reveals the type of services as mentioned in part-B

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it is covered under Service Code 999299 Group 99929 and Heading 9992 as education support service and therefore taxable @ of 18% (9% CGST and 9% HGST) vide sr. no. 30 of notification no. 11/2017-Central Tax (Rate) dated 28.06.2017 and corresponding State notification no. 46/ST-2 Dt. 30.06.2017. – AAR No. HAR/HAAR/R/2017-18/11 Dated:- 1-6-2018 – SANGEETA KARMAKAR AND VIJAY KUMAR SINGH, MEMBER Present for the Applicant: Sh. Amar Pratap Singh, Advocate and Sh. Ankit Awal, C.A. Present for the department: – Factual Background 1. As per the statement of facts submitted by the Applicant, it is a subsidiary of the British Council which is the U.K.'s International Organisation for cultural relations and educational opportunities. International English Language Testing System (hereinafter referred as IELTS') is a highly regarded English Language proficiency test developed, managed and owned by the British Council, U.K. (hereinafter referred to as 'BCUK ). 2. BCUK furthers its chari

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hedule 1B of the agreement, the Exam Support Services would cover the following: (i) To source and manage the running of suitable test centre venues in India for the examination: (ii) To receive registration information from BCUK and its registration agents for IELTS; (iii) To maintain supplies of Test Materials for administration and comply with security requirement set by BCUK and relevant external exam boards in relation to logging in and out. To distribute test materials to candidates on the test day and collect them after test administration for processing; (iv) To manage test administration and logistics for test days, including scheduling of the Applicant's staff and liaison with the test centres; (v) To provide back office support in relation to financial controls and accounting processes in respect of examinations held at test centres managed by the Applicant; (vi) To print IELTS result in paper form from BCUK's global system and distribute certificates on BCUK's b

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hree questions: 1. Whether alt the activities involved in the exam support services constitute a mixed supply or a composite supply? 2. What will be rate of GST applicable on these exam support services? 3. What is the place of supply of these exam support services rendered by the Applicant BCKU? Comment of the Officer under section 98 (1) of the CGST, HGST Act 2017 The Assistant Commissioner, Division East-II, Central GST, Gurugrum vide his comments dated 17.05.2018 has stated as follows: 1. Regarding question no. 1 The impugned services proposed to be provided by the Applicant constitute a composite supply of conduction of examination and other back end support Services. 2. Regarding question no. 2 The principal supply is of the conducting exams which is taxable @ 18%. 3. Regarding question no. 3 The place of supply the impugned service shall be the location of the recipient of the service. Record of Personal Hearing The applicant was afforded a personal bearing for 24.05.2018 and on

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parts. As per schedule-I appended to the copy of agreement submitted on record part-A is for responsibilities of service recipient, part-B specifies 8 types of exam support services and pan-C specifies to services pertaining to student facilitation services. The Ld. Counsel for the applicant had argued that the proposed services as per part-B in schedule -I appended to the copy of agreement are exam support services and constitute a composite supply of conduction of examination and the services mentioned in part-C of said agreement are other back end support services which are so bundled together that such back end support services cannot be said to have an independent existence. These are only ancillary to conduction of examination. The bundle of these services is classifiable as other educational support services under service code 999299 group code 99929 and beading 9992 as per scheme of classification of services appended to notification no. 11/2017 Central Tax (Rate) dated 28.06.2

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se laws and particularly to section 2 (6) of the IGST Act. After hearing these present in detail the decision on admissibility of the application was pronounced and as regard decision on question 1 & 2, on which the application was admitted, was reserved which is being released today. Discussion and finding of authority Since the ruling is restricted only to the question of nature of supply and rate of tax applicable, it is relevant to understand the provisions of law on these issues. 1. Section 2(30) of the CGST/HGST Act 2017 defines a composite supply to mean a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the course of business, one of which is a principal supply. 2. Further Section 2(90) Of CGST/HGST Act 2017 defines a principal supply to mean the supply of goods or services which constitutes the predomi

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with security requirement set by BCUK and relevant external exam boards in relation to logging in and out. To distribute test materials to candidates on the test day and collect them after test administration for processing; (iv) To manage test administration and logistics for test days, including scheduling of the Applicant's staff and liaison with the test centres; (v) To provide back office support in relation to financial controls and accounting processes in respect of examinations held at test centre; managed by the Applicant; (vi) To print IELTS result in paper from from the BCUK's global system and distribute certificates on BCUK' s behalf to successful candidates in India; (vii) To recruit, train and monitor invigilators, examiners and test paper markers for the IELTS tests, in accordance with the standards set by BCUK and their own administrative and management staff; (viii) To periodically inspect the quality of test centres and provide documented evidence on thei

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