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2020 (8) TMI 908 - AAAR - GSTClassification of services - royalty paid in respect of Mining Lease - to be classified under Licensing services for the right to use minerals including its exploration and evaluation, or not - applicability of heading 9973 attracting GST at the same rate of tax as applicable on supply of like goods involving transfer of title in goods - liability to pay tax on contributions made to District Mineral foundation (DMF) and National mineral Exploration trust (NMET) as per MMDR Act, 1957 - HELD THAT:- A mining lease holder or prospecting license cum mining lease is required to pay royalty, dead rent (when it is more than royalty), money to DMF and NMET under the MMDR Act. These leases are granted to the person under the Act and he has to make payment of all the requisite amounts. lie has no choice to make payment of one or more but has to pay all the dues as per Act. The Act has bifurcated the heads for its own convenience, but the person is discharge all the liabilities. AAR in its order has already held that as per sub-clause (i) of clause (17) of section 2 of CGST Act the activity is supply and as per paragraph 5 (e) of schedule II it is a supply of services. Appellant has not contested it - these all payments are made in order to secure a mining or prospecting licence cum mining lease under the Act which are charged by Government. AAR has in its order also held that being a business entity the appellant is liable to pay tax on this supply of services under reverse charge mechanism as per notification 13/2017 central tax (rate) dated 28.06.2017. Hence, the order of AAR is confirmed.
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