No Error Apparent on Record: AAR Rejects Rectification Request over GST Rate on Body-Building Activity [Read Order]

The Authority for Advance Ruling, Tamil Nadu, has ruled that no error apparent on the face of record exists in its earlier decision classifying bus body-building activity as a supply of services under the Goods and Services Tax ( GST ) Act, rejecting the rectification application seeking further clarification on the applicable rate of tax under Section 102 of the Central Goods and Services Tax Act, 2017 and the Tamil Nadu Goods and Services Tax Act, 2017.

The Applicant, M/s. Kailash Vahn Private Limited, had sought rectification against Advance Ruling No. 19/ARA/2024 dated 23 September 2024. The applicant submitted that the operative portion of the ruling should specifically clarify that services performed on chassis supplied by registered customers would constitute “job work”, while services provided on chassis belonging to unregistered persons should be covered under Entry 26(iv) of Notification No. 11/2017 – Central Tax (Rate) dated 28 June 2017 and still attract 18% GST.

The applicant represented by S. Narayanan, contended that paragraph 7.14 of the original ruling already recognised the distinction between registered and unregistered customers for job-work classification and that the omission to explicitly reflect this distinction in the ruling portion amounted to an error apparent on the face of record.

Therefore, it was requested that the ruling be amended to include the classification of body-building activity on chassis belonging to unregistered purchasers under Entry 26(iv).

The jurisdictional officers of both Central and State GST participated in the proceedings, and their position, as reflected in the Authority’s reasoning, was that the ruling already addressed all queries raised in the original advance ruling application, including the rate of tax under both Entry 26(ic) and Entry 26(iv). Therefore, no rectification was warranted.

The application was decided by C. Thiyagarajan, CGST Member and B. Suseel Kumar, SGST Member, rule that rectification under Section 102 of the Central Goods and Services Tax Act, 2017 permits only correction of mistakes that are self-evident from the order.

The request to insert further clarification in the final ruling portion was considered redundant and unnecessary as the detailed reasoning in the ruling already discussed the GST rate implications where chassis are supplied by both registered and unregistered persons.

The Authority observed that the ruling had fully answered the applicant’s original queries and therefore concluded that there was no error on record requiring rectification.

Accordingly, the rectification application was rejected on grounds of being unsustainable.

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