The Karnataka Authority of Advance Ruling (AAR) ruled that the 18% GST payable on the supply of Vouchers.
The applicant, M/s Premier Sales Promotion Pvt. Ltd. is mainly involved in the business of providing Marketing Services. The nature of services provided to each customer depends on the requirement and depends on the tailored agreement with each customer. During the course of business, the applicant receives orders for the supply of e-vouchers wherein the applicant sources e-vouchers for such customers as per the order received and acts as an intermediary for buying and supplying of e-vouchers.
The applicant has sought advance ruling whether the vouchers themselves, or the act of supplying them is taxable, and at what stage, for each of the three categories of transactions undertaken by the applicant and if the answer to the is in the affirmative, what would be the rate of tax at which this would be taxable, i.e. which category would this be taxed.
The applicant submitted that the term “voucher” is defined in Section 2(118) of the CGST Act which reads as “voucher” means an instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services or both and where the goods or services or both to be supplied or the identities of their potential suppliers are either indicated on the instrument itself or in related documentation, including the terms and conditions of use of such instrument.
The two-member bench of Dr. M.P.Ravi Prasad and Mashood Ur Rehman Farooqui ruled that the supply of Vouchers are taxable as goods and the time of supply in all three cases would be governed by Section 12(5) of the CGST Act 2017 and 18 % GST as per Entry No. 453 of Schedule 3 of Notification No.1/2017-Central Tax (Rate) dated June 28, 2017.
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