Appellate Orders

The appeal of the applicant was remanded to AAR, Punjab to re-examine whether the application of the appellant is covered under sub-section (2) of Section 97 of the CGST Act,2017 or otherwise and pass an order on its maintainability

The order dated 22.08.2018 of the Advance Ruling Authority is quashed and the applicant may approach the Advance Ruling Authority for taking a decision afresh in accordance with law. 

1. Whether AJL would be qualified as ‘Local Authority’ under the Central Goods and Services Tax Act, 2017?
2. Whether AJL is liable to pay GST on procurement of security services received from any person other than body corporate under reverse charge mechanism, considering the exemption granted in sl. no. 3 of Notification No. 12/2017 – Central Tax (Rate) or sl. no. 3 of Notification No.09/2017 – IGST (Rate)?
3. Whether AJL is required to pay GST on advertisement services or the service recipient of AJL is required pay GST under reverse charge mechanism considering Notification no. 13/2017-Central tax (Rate) dated 28-06-2017?
4. Whether AJL is required to be registered as a deductor under GST as per the provision of Section 24 of the CGST Act?

        If AJL does not qualify to be  local  authority  under  Central  Goods  and Services Tax Act, 2017 in Part A, can be it construed  to  be  a  government entity or a governmental authority?

The order issued by the original authority for advance ruling is set aside. The appellant can avail Input tax credit of the full GST charged on the undiscounted supply invoice of goods/services by their suplliers. A proportionate reversal of the credit is not required to be done by them in case of a post purchase discount given by the supplier to them throught the C2FO platform, in the circumstances mentioned by the applellant. This is subject to their fulfilling the other conditions stipulated by law and that the GST paid by them for the said goods/services is not reversed or reimbursed/ re-credited etc to them in any manner by the supplier or on his behalf after the credit has been availed by the appellant. The ruling is limited to cases where a post purchase discount is extended by the supplier of goods or services to the appellant on account of their registering in the interactive automated data exchange arrangement setup by C2FO India LLP, which is the subject matter of this advance ruling. 

The Advance Ruling given vide HAAR Order No. HAR/HAAR/R/2018-19 /04 dated 11.07.2018 passed by the Haryana State Authority for Advance Ruling in re: M/s YKK India Private Limited, Plot No. 699, Sector-2, Plot No. 122, Sector-6, HSIIDC, Growth Centre Bawal, District-Rewari, Haryana is modified.

1. Whether the incentives received under “Atma Nirbhar Gujarat Sahay Yojna” dated 16.05.2020 declared by the Gujarat Government could be considered as subsidy and not chargeable to tax?

2. Whether the incentive received under said scheme could be considered as supply of service under the provisions of section 7 under CGST Act?

3. Whether the incentive received under said scheme if considered as supply then would it be covered under section 7(2) of CGST Act?

4. Whether the incentive received under said scheme could be considered as excluded from the value of taxable supply under section 15(2)(e) of CGST  Act, 2017.

The Appellate Authority for Advance Ruling upheld  the ruling given by the Advance Ruling Authority by observing  that since they are not providing any services in relation to the NSDC programme implemented by the NSDC, they are not eligible for the  exemption provided in the entry 69 of the Notification No. 12/2017-C.T. (Rate) dated 28.06.2017.

In reply to the questions raised by the Appellant before AAAR, The Appellate Authority for Advance Ruling  held as under:

1. The service supplied by the Respondent under the Service Agreement dated 1 March 2013 constitute a mixed supply of services falling under the Heading “ accounting services” having SAC 9982,  and under the Heading “other professional, technical and business services” having the SAC 9983. 

2. The service supplied by the Respondent under the Marketing Services Agreement dated 1 December 2012 constitute a mixed supply of Services falling under the Heading “Research and Development services” having SAC 9981, under the   Heading “Other professional, technical and business services” bearing SAC 9983, and under the Heading “other miscellaneous services” bearing SAC 9997. 3.We cannot pass any ruling in relation to the export of services, as the same would require the determination of the place of supply of services, which is not under the jurisdiction and scope of the Advance Ruling Authority.

The Appellate Authority for Advance Ruling  held that the entire gamut of activities of the Appellant is in the nature of the composite supply, of which intermediary services is the principal supply. Further, as regards the services provided by the Appellant to their Client, namely Sabre APAC is export or otherwise, we hold that we do not have jurisdiction to decide the place of supply of service, which is one of the pre requisites to determine the export of services in terms of Section 2(6) of the IGST Act, 2017 and hence we cannot pass any ruling in respect of the same.

The Appellate Authority for Advance Ruling upheld  the ruling given by the Advance Ruling Authority by observing that the ruling pronounced by the Advance Ruling Authority in as much as the activities performed by the PIL, on the goods of the Appellant, are in the nature of the Job work and accordingly attract 18% GST.