The Karnataka Authority for Advance Ruling (AAR) has held that they can’t rule on the utilization of ITC available in the Electronic Credit Ledger under the provision of Central Goods and Service Tax(CGST), 2017.
M/S. Preethi Granite Exports, the applicant isa Partnership firm engaged in the manufacture and sale of granites, falling under tariff heading 2516 12 00 of the Customs Tariff Act. They have their quarry and buy quarry blocks from other suppliers.
They export the granite slabs, after cutting & polishing, to various countries. They have a small number of finished goods, which will be supplied on payment of tax within a short period and have a balance ofunder CGST, under KGST Rs.9,990/under Cess, in the Electronic Credit Ledger and Rs.37,955/- under CGST & Rs.37,955/- under KGST in the Electronic Cash Ledger.
The first question is whether the applicant can continue with existingregistration for discharge of GST liability and also for filing returns relating totheir new business. The applicant intends to know whether a separate registration needs to be taken or otherwise for the conduct of his new business. From the said question, it is seen that the applicant does not intend to know whether they are required to be registered.
The second question is about utilising the ITC in their Electronic Credit Ledger. The applicant claims that the said question is covered under the issue of admissibility of an input tax credit of tax paid or deemed to have been paid, in terms of Section 97(2)(d) of the CGST Act 2017.
A two-member authority comprising Dr M. P. Ravi Prasad and Sri. Kiran Reddy T observed that the issue of utilization of ITC is available in the Electronic Credit Ledger and the question is not covered under the issues specified in Section 97(2) of the CGST Act 2017. The third question is about the utilization of the amount available in their Electronic Cash Ledger towards discharge of GST liability on rental/lease income, which is not covered under the issues specified in Section 97(2) of the CGST Act 2017.
The authority observed that the application is not maintainable as the questionson which advance ruling is sought by the applicant are not covered under the issues specified in Section 97 (2) of the CGST Act 2017 and rejected the application.
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