The Authority for Advance Rulings (AAR), Gujarat has held that the exemption for inland waterways under the Goods and Services Tax (GST) Act is not available for providing service relating to transportation of goods in the water way, i.e. from Magdalla Port to its General Lighterage Area (Anchoring Point of Mother Vessel).
The applicant approached the authority seeking clarification regarding the applicability of GST for the service relating to transportation of goods in the water way, i.e. from Magdalla Port to its General Lighterage Area (Anchoring Point of Mother Vessel) or vice versa. This waterway is a part of the Arabian Sea. Whereas, the term “Other waterway on any inland water” covers any canal, river, lake or other navigable water within a State only. The length of the waterway, between which the service of transport is performed by the applicant, is the part of the “Arabian Sea” and not a part of any canal, river, lake or other navigable water within a State.
Before the authority, the applicant argued that the transportation is being done on the inland waterway falling within the state, appears to be incorrect.
The authority noted that the Arbian Sea is not a part of the State of Gujarat and, hence, not covered under the term “Other waterway on any inland water” so as to be eligible for exemption of the Services by way of transportation of goods by inland waterways.
“In view of the above, we conclude that the service of transportation of goods in barrages from mother vessel to daughter vessel from Magdalla Port, Surat to its General Lighterage Area of Magdalla Port is neither covered in the definition of ‘national waterways’, as defined in Clause (h) of section 2 of the Inland Water Ways Authority of India Act, 1985 nor covered in the definition of ‘other waterway on any inland water’, as defined under Clause (b) of Section 2 of the Inland Vessels Act, 1917. Consequently, the same does not qualify for exemption contained at Sr. No.18 of the Notification No. 12/2017-Central Tax (Rate), dated 28.06.2017,” the authority said.
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