This weekend summary provides an analytical synopsis of the most major stories of Goods and Service tax Authority for Advance Ruling (AAR) and Appellate Authority for Advance Ruling (AAAR) that were authored at Taxscan.in during the two week from to March 18 to April 1, 2023.
The Haryana bench of Sunder Lal and Kumud Singh , Authority for Advance Ruling (AAR) ruled that Good and Services Tax (GST) is applicable on export of pre-packaged and labelled rice up to 25kg.
The bench determined that that GST is applicable to all supplies of pre-packaged and labelled rice bags made to foreigners. In addition, the bench noted that regardless of whether the rice is being sold for internal use or export, 5% GST will be applied if it is being delivered in pre-packaged and labelled bags with a capacity of up to 25 kg.
The Rajasthan Authority for Advance Ruling (RAAR) ruled that advance ruling may not be requested. The bench concluded that the application is not covered by advance ruling as a result.
Moreover, they observed that the applicant filed their application before the Rajasthan AAR on 14.10.2022 i.e. much later from the supply of services. The Applicant was discharging his GST liability since starting on the service supplied by him and asked for advance ruling when subsidy has not been given to him from the concerned department. We observe that the applicant’s motto is to find out whether the mechanism opted by him for payment of GST on said service is right or wrong, which is against the spirit of advance ruling
Haryana bench of Sunder Lal and Kamud Singh for Advance Rulings (AAR) ruled thermal based fogging machine attracts 18% of the GST
The bench observed that in general and technical terms a fogging machine is a mechanical appliance. As a fogging machine convert the liquid inside it into another state of matter before disbursing the same in the form of a haze. These vapours are transported via the machine’s nozzle and released into the atmosphere. The disinfectant or chemical liquid administered through a fogging machine spreads on both surfaces as well as in the air itself. The micro-droplets of disinfectant or chemical solution remain on surfaces for a longer period. The thin fog penetrates smaller and hidden surfaces and even reaches into corners and difficult regions.
he Authority for Advance Ruling ( AAR ), bench of Sunder Lal, and Kumud Singh, Haryana, has recently, in an application filed before it, held that PVC cushion mats taxable at 18% GST,
The bench observed that “The supply of the said goods i.e., PVC cushion matts fall under chapter 39 of the GST tariff rates. And the applicable tax rate of the same is 18%
The Haryana Authority for Advance Rulings (AAR) ruled that water supply activities done by the developer for residential house attracts 18 % GST.
The AAR bench concluded that for any supply to be covered under the Pure Services that there should be no supply of goods, the recipient should be Central government/State government/Union territory/ Local Authority and services should be by way of any activity about any function entrusted to a panchayat under article 243G of the constitution or about any function entrusted to a Municipality under Article 243 W of the Constitution. Exclusion in this entry is already mentioned.
The Haryana bench of Sunder Lal, and Kumud Singh Authority for Advance Ruling (AAR), observed that the Fees for Gastroenterologist services received by M/s Asian exempt from GST.
The Bench,noted that “Fee/charges for Health Care Services received by M/s Asian is exempt under GST except for the services mentioned under heading 9993 clause no. 3 IA vide notification no. 13.07.2022.”
The Haryana bench of Sunder Lal, and Kumud Singh Authority for Advance Rulings ( AAR ) ruled security services by Limited Liability Partnership ( LLP ) to any registered person are not covered under Reverse Charge Mechanism (RCM).
The bench observed that an LLP is a Body Corporate for the Companies Act, 2013 and the same would apply to the term body corporate for notification no. 13/2017-CGST(Rate) dated 28.06.2017 and as amended on 31.12.2018 vide notification no. 29/2018. The Authority ruled that an LLP is a body corporate and so excluded from entry no. 14 of notification no. 13/2017 dated 28.06.2017 and notification no. 29/2018 dated 31.12.2018. The applicant is required to charge applicable tax on the security services supplied by him as per section9 (1) of the CGST/HGST Act, 2017 read with the relevant provision of the IGST Act, 2017.
The Rajasthan bench of Umesh Kumar Garg, and Mahendra Singh Kavia, Authority for Advance Ruling (AAR), held that the Services of Construction and Recarpeting of Commercial Complex Road to Rajasthan Housing Board attracts 18% GST.
The Bench observed that “We further observe that GST rates of Works contract involving construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of following rendered to Government or Local authority increased to 18% vide Notification No. 03/2022- Central Tax (Rate) I Dated: 13th July, 2022.”
The Bench also noted that applicant filed their application before the Rajasthan Authority for Advance Ruling (RAAR) on 02.06.2022 i.e. much later from the execution of contract dated 08.09.2021 and that the applicant is registered with GST authorities and well aware about the type of supply its notification, circular, discharging his GST tax liability and submitting his GST returns in accordance to them with effect from execution of contract
The Haryana bench of Sunder Lal and Kamud Singh ,Authority for Advance Rulings (AAR) ruled that the engagement of system integrator for MRBD services for water supply & sewerage connections under the jurisdiction of Municipal corporations are taxable services which attract 18% of GST.
The bench concluded that the services provided by the applicant to MC, Gurugram is a taxable supply. Engagement of system integrator for implementation water revenue management system, creation and maintenance of database, spot billing/meter reading and bill distribution (MRBD) services for water supply & sewerage connections under the jurisdiction of Municipal Corporation, Gurugram is covered under which SAC 998633of the CJST Act, 2017.
According to the decision made by the Odisha bench of G.K. Pati and P.K. Mohanty ,Authority for Advance Ruling (AAR), the applicant (registered person), who obtained the service by renting residential space to use as a guest house, is subject to the Goods and Services Tax (GST) under the Reverse Charge Mechanism (RCM) in light of the Notification No. 05/2022-Central Tax (Rate) dated July 13, 2022.
The bench highlighted the notification No. 05/2022-Central Tax (Rate) dated the 13th July, 2022 CBIC, notified that with effect from 18th July 2022, service by way of renting of residential dwelling to a registered person shall be attracting GST under RCM. It was observed that the liability to pay GST @ 18% under the RCM will arise on the recipient (tenant), if he is a registered person under GST with no other condition.
Further, it may be noted that type or nature/purpose of use of residential dwelling i.e. for residence or otherwise by the recipient, has not been a condition in the said RCM notification. Hence, service of renting of residential dwelling to a registered person, would attract RCM irrespective of the nature of use.
The Uttar Pradesh Authority for Advance Ruling (AAR) consisting of members Harilal Prajapati and Rajendra Kumar ruled that sugarcane juice attracts 12% Goods and Services Tax (GST).
The authority observed that as per chapter heading 2009, it includes “fruit juices (including grape must) and vegetable juices, unfermented and not containing added spirit, whether or not containing added sugar or other sweetening matter”. Since sugarcane is not a fruit or vegetable. Hence it shall fall into tariff item 20098990, “others”.
Further stated that although, there is no specific entry for the product ‘Sugarcane Juice in Notification NO. 1/2017-Central Tax (Rate) dated 28.06.2017, there is an entry most akin to the product and process (at sr. No. 41 of Schedule 2 of Notification No.1/2017 CENTRAL TAX (Rate) Dated 28-6-2017 and attracts 6% CGST and 6% SGST or 12% IGST under tariff item 20098990.
The Karnataka Authority for Advance Rulings (AAR ) ruled that no GST exemption to Aircraft Type Ratings (ATR) training for commercial pilots since it does not result in qualification but only course completion.
The Authority ruled that the impugned services of the applicant are not covered under entry number 66(a) of the Notification 12/2017-CentraI Tax (Rate) dated 28-06-2017, as and hence do not qualify for the exemption.
The supply of the aircraft type rating training services to commercial pilots, by the training curriculum approved by the Directorate General of Civil Aviation for obtaining the extension of aircraft type ratings on their existing licenses, does not result in qualification as the applicant imparts training and issues only course completion certificate and thus the impugned services are not covered under Sl. No. 66 (a) of Notification No. 12/2017Central Tax (Rate) dated 28.6.2017 and are eligible for GST under the CGST / KGSTAct 2017.
Karnataka Authority for Advance Ruling (AAR) consisted of members Dr. M. P. Ravi Prasad and Kiran Reddy T. ruled that the transition of sale of one of the independent business divisions along with its assets and liabilities on a going concern basis in terms of business agreement comes under the purview of transaction of supply under section 7 of CGST/KGST Act, 201.
The applicant intended to sell the staffing business in the course of his business and thus the third limb also is fulfilled. Thus the panel observed that the applicant satisfied all the 3 parts and thus the transaction constitutes ‘Supply’. Also, it was also ruled that 18% of GST has to be paid in terms of Entry No.15(vii) of the Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017, as amended.
The Karnataka Authority for Advance Rulings (AAR) ruled that the supply of goods to overseas customers is neither supply of goods nor supply of services under Entry 7 of Schedule III of Central Goods and Services Tax Act (CGST), 2017.
The observed that the goods are supplied from a location outside India to a location outside India. That is both the places are outside India. The supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India. Thus it was ruled that the said transaction shall treated as neither as a supply of goods nor supply of services.
The Gujarat bench of Amit Kumar Mishra and Milind Kavatkar Authority for Advance Ruling ( AAR ) has ruled that 28% GST is payable on the supply of PVC floor mats for cars.
The bench of has observed that the floor mats used for four-wheel motor vehicles (cars) supplied by the applicant are principally for use in motor vehicles. The applicant’s contention is that the product would merit classification under CTH 3918, as the product in question is a floor covering of plastic. The concluded by noting that the impugned goods i.e. PVC floor mats for use in cars supplied by the applicant is classifiable under CTH 8708 & applicable rate of GST would be 28% [14% each of CGST and SGST].
The Gujarat Authority for Advance Ruling ( AAR ) has held that 28%Goods and Service Tax ( GST ) attracts on the supply of unmanufactured tobacco leaves coated with natural edible gum.
The authority ruled that on purchase of tobacco leaves/bhukko from the agriculturist, the applicant is liable to pay GST on RCM basis at 5% [2.5% CGST and 2.5% SGST] in terms of notification No. 1/2017-Central Tax (Rate), Sr. No. 109 of Schedule I.
The AAR held that in case of a supply of unmanufactured tobacco leaf consequent to coating the same with natural edible gum, the applicant is liable to pay GST at 28% [14 % CGST and 14 % SGST] in terms of notification No. 1/2017-Central Tax (Rate), Sr. No. 13 of Schedule IV
The Odisha bench of G K Pati and P K Mohanty, Authority for Advance Ruling has recently ruled that service received by a registered person by way of renting of residential premises used as a guest house of the registered person is subject to Goods and Services Tax (GST) under Reverse Charge Mechanism (RCM).
The bench observed by the that the decision to bring the renting of residential dwellings under the tax net was taken in the 47th GST Council Meeting held in June 2022 by partially removing the exemption and including the same under RCM services when provided to a registered person.
It was thus ruled that, wherein the Applicant (Registered person) has received the service by way of taking residential premises on rent for use as its guest house, it is observed that the said service received by the Applicant (Registered person) is subject to GST under Reverse Charge Mechanism in view of the Notification No. 05/2022- Central Tax (Rate) dated 1 July, 2022.
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