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2018 (11) TMI 1264 - AAR - GSTSupply or not - amount passed on to the customer by Del Creder Agent (DCA) on account of the early payment before credit period allowed by principal - supplier/receiver in the transaction - classification of such Supply and its HSN/SAC Code and applicable GST Rate - exemption under N/N. 12/2017 Central Tax (Rate) dated 28th June 2017, applicable w.e.f. 01.07.2017 - credit of the ITC of the GST charged on such supply. Held that:- As per pricing policy of RIL dated 15.06.2018 regarding supply of goods for sale, the cash discount of ₹ 800/MT/Day is applicable on all grades except plant sweepings and waste grades and will be deducted from the basic price as per price Circular for payment of GST. Further, an additional bonus / discount of ₹ 80/ MT/ Day is available on early payment made by the applicant or the customer against such supplies made by the RIL, if such payment is made within 10 days of supply of the goods. The transaction made between DCA and the Customer for passing on the specified bonus given by the principal is nothing but an additional discount given for early payment made by the customer. In this case there is only one supply made by the principal to the customer. The additional discount relates to supply already made by the principal and passing on such bonus to the customers by DCA is in the nature of pure agent. However, any amount retained by the DCA on account of early payment is in the nature of supply made to the principal as business support services on which the DCA is already paying GST. ITC Credit on GST charged - Held that:- The invoices can be issued by the supplier of the goods and services only - In the instant case, the customer is recipient of the goods supplied by the principal and any amount due to him can be adjusted by credit notes/ debit notes in relation to that supply. As the customer is recipient of the goods or services, he is not liable to issue invoices in respect of goods or services supplied by the principal. When there is no supply to DCA by customer, the DCA is not entitled to take ITC of GST passed on to the DCA in any manner. Ruling:- The additional bonus passed on by the applicant (DCA) to the customer, is not in nature of a supply in accordance with GST Act, 2017. Since, the said transaction is not a supply by the customer; invoice cannot be raised/ issued by the customer and if any amount passes on to the DCA in any manner, the DCA is not entitled to take ITC of the said amount passed on by the customer.
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