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2021 (10) TMI 635 - AAR - GSTLevy of GST - Classification of services - HSN Code - rate of GST - proposed receipt of money in case of Arbitration claims awarded for works contract completed in the Pre-GST regime - Unpaid amounts including escalation of price for works executed in pre-GST period - Refund of excess deductions made - Interest on delayed payments of interim payment certificates - Cost of Arbitration - Liquidated damages - Interest on Arbitration Amount. Unpaid amounts including escalation of price for works executed in pre-GST period - time of supply of services - HELD THAT:- The time of supply of service according to Section 13(2) is the earliest of the date on which invoice is issued or date of provision of service or date of receipt of payment or date on which recipient shows the receipt of services in his books. As seen from the averments of the applicant the supply was made prior to introduction of GST. Therefore it is not covered by Section 13(2) of the CGST/SGST Acts. Hence the amounts claimed pertaining to the works executed earlier to introduction of GST are not taxable under CGST/SGST Acts. Refund of excess deductions made - HELD THAT:- The refund of excess deductions both statutory and non-statutory made against the bills raised for the works completed in pre-GST period do not constitute consideration for supplies made under GST period. Therefore these amounts are not taxable under CGST/SGST Acts. Interest on delayed payments of interim payment certificates - HELD THAT:- In the present case, Arbitration as service was supplied independently after the introduction of GST i.e., the tribunal was constituted conclusively on 20.11.2017 and rendered its orders on 09.05.2019 and therefore this supply is liable to tax on reverse charge basis under GST. Liquidated damages - HELD THAT:- The time of supply of the service of tolerance is the time when such determination takes place. However, the contractee/employer has not determined the cost of delay prior to arbitration award. It was determined only by arbitration award on 09.05.2019. Therefore the time of supply of this service as per Section 13 of the CGST Act is 09.05.2019. The Consideration received for such forbearace is taxable under CGST and SGSt @9%. Each under the chapter head 9997 at serial no. 35 of Notification No.11/2017- Central/State tax rate. Interest on Arbitration Amount - HELD THAT:- The applicant is claiming interest on the amounts determined by the arbitrary tribunal under various heads. Under Section 15(2)(d) of the CGST/SGST Acts interest for delayed payment against a supply is consideration which is taxable under CGST/SGST Acts. Therefore the interest on amounts exigible to tax under CGST/SGST forms part of value of taxable supply.
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