Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 14-3-2019 – In certain cases, authorities charges fees or charge or surcharge, called by different names, from vehicles for maintenance of road and ancillary facilities. At times, it is in the nature of toll charges. The question of taxability of such charges came up for deciding the taxability before the Authority for Advance Ruling and Appellate Authority of Uttarakhand recently in the case of Divisional Forest Officer, Dehradun 2018 (6) TMI 430 – AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND In the instant case, the assessee was a Regional Forest Officer (Forest Division Dehradun) and sought an advance ruling on the question whether GST is leviable on the Marg Sudharan Shulk and Abhivahan Shulk charged by Forest Division, Dehradun from the non-government, private and commercial vehicles engaged in mining work in lieu of use of forest road. The said mining is being undertaken at Saung and Jakhan Rivers falling under the
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
udharan shulk is nothing but toll charges collected by the assessee from the users for using forest road and the said toll charges are being used for the maintenance of forest road. Therefore it concluded that no GST is leviable as on date on the said marg sudharan shulk charged and collected by the applicant. Further, Abhivahan Shulk cannot be termed as toll tax and rather is a form of consideration received by the applicant in lieu of services provided to the person for carrying forest produce and since the services provided by the assessee are not mentioned in the list of exempted services, the applicant is liable to pay GST @ 18% on the said Abhivahan Shulk under Service Code 9997 and to be treated as other services . Appellate Ruling Aggrieved by the Order passed by the Authority for Advance Ruling, the appellant preferred an appeal before the AAAR. The AAAR has confirmed the ruling vide Order dated 20.04.2018 and reported in IN RE : DIVISIONAL FOREST OFFICER, DEHRADUN (2018) 9 TM
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
7 It was observed that a fee is charged in lieu of some service granted to a particular class of persons from whom it is being charged. Such fees are to offset the expenses (partly or fully) incurred in rendering the said service and co-relation between the two with exact mathematical precision is not important and in some instances such as license fee, which are regulatory in nature, the quid pro quo also is not essential. The Abhivahan Shulk (transit fee) is different from the Marg Sudharan Shulk (both of which are collected by the forest department under statute of State Government) in as much as the latter is collected for the upkeep and maintenance of roads within the forest area and the same is collected from all the vehicles, whether loaded or empty. Thus the Marg Sudharan Shulk is used for the benefit of public in general who may use the roads of the forest area and not only to a particular class of people who are paying the said fee. The rates of Abhivahan Shulk, on the other
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
e forest produce and ensuring the continued availability of the forest produce and its safe transit through the jurisdiction of forest department. These services are restricted only to the persons who are carrying the forest produce and have paid the Abhivahan Shulk. Thus, only a particular class of people, who are registered with the forest department and paying the said fee, in terms of The Uttarakhand Transit of Timber and Other Forest Produce Rules, 2012, enjoy these services. Abhivahan Shulk fulfils all the criteria, which are required to be established for a Government levy, for it to be termed as 'fee'. The very nature of it being a fee ensures that a quid pro quo has to be there and therefore, rendering of some form of service comes in built, which is also established as discussed above. Thus, this shulk collected against the services rendered, is liable to be taxed under the provisions of Goods and Service Tax Acts, unless otherwise exempted. Merely the fact that the t
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
ry No. 5 of the said notification relates to functions entrusted to Panchayat. On the other hand, Serial No. 6 of the said notification states that Services by the Central Government, State Government, Union territory or local authority excluding the following services – (a) ………………(b) ………………(c) ………………(d) any service, other than services covered under entries (a) to (c) above, provided to business entities are to be taxed at 'NIL' rates. Abhivahan Shulk does not fall under exclusion clauses (a) to (c) and hence they are to be treated as any service provided to a business entity, as per clause (d) and accordingly the fee does not fall under the category of 'NIL' rate. The Heading number 9997 at entry serial no. 35 of Notification no. 11/2017-Central Tax (Rate), dated 28.06.2017 reads – Other services (washing, cleaning and dyeing services; beauty and physical well-being services; and other miscellaneous services including services nowhe
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =