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GST - Case Laws
Showing 61 to 80 of 1965 Records
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2021 (12) TMI 885 - AUTHORITY FOR ADVANCE RULING, TAMILNADU
Scope of Advance Ruling - Completion of various compliance actions would apply to the time limit provided for the export of goods under notification no. 41/2017 - Integrated tax (rate) Dated October 23, 2017 - relaxations provided vide the notification of 35/2020-Central Tax Dated April 3, 2020 - delay of one day over and above the 90 days specified - benefit of concessional rate of 0.1% IGST - HELD THAT:- The applicant is of the view that there is no violation of Notification No. 41/2017- Integrated Tax (Rate) and the goods have been exported within the extended time limit specified in the Notification No. 41/2017 - Integrated tax (rate) Dated October 23, 2017, read with Notification No. 35/2020 - Central tax dated April 3, 2020. Accordingly, the 0.1% CGST charged by them is correct and requires no further action.
The applicant had made supply of goods vide Invoice No. 2019100603, 2019100601, 2019100605 all dated 11.03.2020, e -way bills raised and the goods had been dispatched to the recipient. Further, the applicant vide their letter dated 31.05.2021, has submitted the Proof of documents on the supply made by them vide Notification No. 41/2017 dated 23.10.2017 through mail to the Customs Jurisdictional Officer, in respect of the above invoices for which the ruling is sought before us. The applicant has contended that the question is admissible for ruling as the present application is in relation to the applicants’ transaction with the customer which is an ongoing transaction wherein the applicant supplies goods to customer as per Notification 41/2017.
In the case at hand, it is found that the question raised is in relation to the supply which had been made by the applicant and the proof of documents of such supply furnished before the concerned authorities for further action as required under Notification No. 41/2017-I.T.(Rate) dated 23.10.2017. The necessary documents have been furnished vide their letter dated 31.05.2021 and the application seeking the ruling is made on 09.07.2021 - the question raised by the applicant as to whether the benefit of the concessional rate of 0.1% IGST, would still be available to them is not admissible before this authority.
Applicability of relaxation provided under Notification No. 35/2020 C.T. - time-limit provided for the export of goods under Notification No. 41/2017 -I.T(Rate) - HELD THAT:- The questions admissible should pertain to the supply being undertaken’ or ‘proposed to be undertaken’ by such applicant only. In the facts presented, it is noticed that supply has been undertaken by the Merchant Exporter .and not by the applicant as stated in their submissions. Hence, the applicant cannot seek the ruling for the supply undertaken by the Merchant Exporter and therefore the question which seeks ruling on the applicability of relaxation in the time-limit for export is not admissible.
The Application for Advance Ruling is not admitted, under sub section (2) of section 98 of the CGST /TNGST Act, 2017 read with Section 95(a) of the Act.
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2021 (12) TMI 884 - AUTHORITY FOR ADVANCE RULING, TAMILNADU
Input tax credit - Motor cars of seating capacity not exceeding 13 (including Driver) leased or rented to customers - Motor cars of seating capacity not exceeding 13 (including Driver) registered as public vehicle with RTO to transport passengers, provided to their different customers on lease or rental or hire - Renting or Leasing or Hiring Motor Vehicles to SEZ to transport the employees of the customers without payment of IGST under LUT - Section 17(5) (a)(A) of Central Goods and Service Tax Act, 2017 - HELD THAT:- The activity undertaken by the applicant is supplying services of car hire/rentals with the drivers and the recipient uses the services received for the transportation of their staff, Associate, etc. When in respect of Schedule-I of the agreement with Amazon, the payment is made per vehicle- wise as a 'Fixed Monthly Packaged Model', the payment is calculated based on vehicle-wise/Trip-wise in the case of Fidelity Business. The terms of service to be extended in all such agreements/schedules are supply of vehicles of certain standards, fixed with tracking accessories/panic buttons & qualified drivers. The supply is restricted to the Vehicle with the Drivers. The usage, i.e., Trip Schedules, routes, etc are done by the Transport team of the Vendor - reading the full agreement clearly shows that the supply extended is only supply of services of renting/hiring of vehicles with operator classifiable under "SAC 9966 - 'Renting of Vehicles with Operators'". This stands established by the fact that the applicant in their invoices raised on Amazon and Fidelity, copies of which are provided, have mentioned the SAC as 9966.
The exception provided at Section 17(5)(a)(A) is that the ITC in respect of Motor vehicles having approved seating capacity of not more than thirteen persons are available when they are used for making further supply of such motor vehicles. The contention of the applicant is that they are buying and using the vehicles for supplying services of 'Renting of Vehicles with Operators' and the same is 'further supply of such vehicles' in as much as 'Supply' as defined under Section 7 of the Act includes all forms of supply of goods or services such as rental, lease for a consideration in the course of furtherance of business - it could be construed that Section 17(5) (a) (A) of CGST Act, 2017 allows ITC of GST paid on purchase of motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), only when the taxable person makes further supply of such motor vehicles. The applicant in this case is a service provider, who provides service of renting/leasing motor vehicles. The taxable outward supply in this case does not include further supply of such purchased motor vehicles. Hence the applicant is ineligible to avail ITC on motor vehicles as per section 17(5)(a) (A) of CGST Act 2017.
In the case at hand, from the various clauses of the agreement it is seen that the applicant is obligated to supply on rental/hire basis vehicles of particular standards with the drivers to their vendors - Therefore, it is evident that the supply made by the applicant is rental/hire of such vehicles and the activity of transportation of employee/associates is undertaken by the Vendor. Thus, in as much as the activity undertaken by the applicant is only renting/hiring of the Motor Vehicles with the operators and not undertaking transportation of passengers, the exception at S. 17(5)(a)(B) is not available to the applicant.
Whether the supply of services by way of Renting or Leasing or Hiring Motor Vehicles to SEZ to transport the employees of the customers without payment of IGST under LUT is deemed as taxable supply? - whether ITC is admissible on Motor Vehicles procured and used commonly for such supply to SEZ and other than SEZ supplies? - HELD THAT:- According to Section 7(5)(b) read in conjunction with section 5(1) of IGST Act 2017, supply of goods or services or both to a SEZ developer or a SEZ unit shall be treated as a supply in the course of interstate trade or commerce and leviable to tax under IGST Act. Also in accordance with Section 16(1) of IGST Act 2017, supply of goods or services to SEZ developer or SEZ unit is classified as "Zero rated supply". In addition, section 16(3)(a) of IGST Act 2017 enables a registered person to make zero rated supply under LUT without payment of IGST. Therefore, supply of renting/hiring of such Motor Vehicles to SEZ under LUT is a taxable supply - since the ITC of the Tax paid on purchase of such vehicles are restricted as per the provisions of S.17(5)(a) and not Excepted under S. 17(5)(a)(A).
The ITC is not admissible on the tax paid on procurement of such vehicles.
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2021 (12) TMI 883 - AUTHORITY FOR ADVANCE RULING, TAMILNADU
Classification of goods - supply of Stator Coil by the Applicant to Coral Manufacturing Works India Private Ltd.- taxable at 12% or not - HELD THAT:- Para 11 of Circular No.80/51/2018 GST dated 31.12.2018, clarifies the applicability of GST on Waste to Energy Plant. It clarifies that the benefit of concessional rate is available to such equipment, machinery, etc which fall under Chapter 84, 85 and 94 and used in the initial setting up of renewable energy plants and devices; and that GST being self assessment tax, the taxpayer is to satisfy himself with the requisite document from a buyer such as ‘supply contracts’/’Order for WTEP from the concerned authorities’ before supplying goods claiming the concession.
The requisite document from a buyer such as ‘supply contracts’/’Order for WTEP from the concerned authorities’ before supplying goods claiming the concession. The applicant has mis read the clarification and is before us considering this Advance Ruling authority as the ‘concerned authorities’ mentioned in the said circular. The circular clarifies the doubt regarding the Waste to Energy Plants and it is clearly stated in Para 11.3, that the tax being self-assessed, the supplier, before effecting the supply adopting the concessional rate, has to satisfy himself with the requisite’ documents from the recipient, such as supply contracts or order for WTEP from the concerned authorities. Therefore, the ‘Concerned authority’ specified in the said circular is not this Authority, but the buyer of such WTEP As its related parts. However, as the question raised is on the applicability of the entry of the notification, the same is answered.
In the instant case, the applicant has produced copies of Purchase orders no.PO 61 dt.21.01.2021 and PO 133 dt. 16.02.2021 received from M/s. Coral Manufacturing Works India Pvt Ltd, wherein it has been specified that the purchase orders are for the supply of Form wound coil(Stator coil) HSN 85030090, for Enercon Make, Wind Operated Electricity Generator EP3 E138. Thus, the fact of supply of stator (‘oils being meant for manufacture of WOEGs is established - GST being self assessed tax, the applicant should satisfy himself that such goods would be used in the WOEG on the basis of requisite document from a buyer such as supply contracts/orders for WOEG from the recipient before supplying goods claiming concession under said entry 234 (Now 201). Hence the onus of proving that such goods arc being supplied to WOEG is on the supplier of such goods with documentary proof to that extent.
The ‘Stator Coils’ in question falls under CTH 8503 and the supply is made to M/s. Coral Manufacturing Works Private Limited for manufacture of WOEGs and therefore in the instant ease, the rate applicable is 6% CGST as per Sl.No.201A of the Schedule II to Notification no. 01/2017-CT (Rate) dt.28.06.2017 as amended and 6% SGST as per SI. No. 201A of Schedule II to notification M.S.no.62/201 7 dt. 29.06.2017 as amended effective from 30.09.2021.
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2021 (12) TMI 840 - SUPREME COURT
Validity of Circular issued by the CBIC - Jurisdiction - Form GSTR-3B is return or not - imposition on rectification of Form GSTR-3B in respect of the period in which the error had occurred - HELD THAT:- The judgement of the High Court has been expressly overruled by a three-Judge Bench decision of this Court in Civil Appeal [2021 (11) TMI 109 - SUPREME COURT] - Learned counsel for the respondent was at pains to persuade us that the three-Judge Bench judgment can be distinguished, without realising that the three-Judge Bench judgment expressly overrules the impugned judgment. - Decided in favor of Revenue.
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2021 (12) TMI 839 - ALLAHABAD HIGH COURT
Seeking grant of anticipatory bail - event of arrest under Section 132(1)(a)(b)(c)(d) (i) Central Goods and Services Tax Act - HELD THAT:- Let the matter be listed on 12.1.2022 as fresh before the appropriate Bench.
Since the applicant no. 2 has been granted interim protection vide order dated 07.12.2021, till the next date, in the event of arrest of the applicant no. 2 Vipin Kumar, in pursuance of summoning order dated 22.3.2021, under Section 132(1)(a)(b) (c)(d) (i) Central Goods and Services Tax Act, he shall be released on interim anticipatory bail on his furnishing a personal bond of ₹ 50,000/- with two sureties each in the like amount to the satisfaction of the concerned Officer of Central Goods and Services Tax Act, with the conditions imposed.
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2021 (12) TMI 838 - GUJARAT HIGH COURT
Seeking direction against the respondent No. 3 to release the provisional attachment of the bank accounts, plant & machinery, factory premises - provisional attachment made is dehors the provisions of Section 83 of the Central Goods and Services Tax Act, 2017 - HELD THAT:- The objections have been filed by the petitioner well within time. The commissioner has also afforded opportunity of hearing. However, he needs to pass an order which since has not come, the petitioner is before this Court.
Let such order be passed within 3 days. Any further actions on the part of the respondents if aggrieved by the outcome shall be permissible under the law.
Application disposed off.
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2021 (12) TMI 837 - DELHI HIGH COURT
Validity of direction declaring the continuance of blocking of petitioner’s ITC beyond a period of one year - violation of express mandate of Rule 86A(3) of the CGST Rules, 2017 - HELD THAT:- Issue notice. Mr.Abhinav Kalia, Advocate accepts notice on behalf of the respondent. He states that he has no instructions in the present case.
Keeping in view the fact that the petitioner’s representations/letters dated 15th June 2021 and 17th September, 2021 have not been decided till date, the present writ petition is disposed of with a direction to the respondent to decide the aforesaid representations/letters by way of a reasoned order in accordance with law within four weeks.
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2021 (12) TMI 836 - MADRAS HIGH COURT
Seeking release of goods - expired E-way bill - Central Goods and Service Tax Act, 2017 and the Tamil Nadu Goods and Service Tax Act, 2017 - HELD THAT:- For the expiry of the E-Way Bill, the explanation of the petitioner in this Writ Petition is that there was torrential rain in Tamil Nadu, particularly, in Chennai District and therefore the vehicle could not move and that the journey was started later in time, by which time, the E-Way Bill generated on 27.11.2021 at about 06.23 p.m. had expired.
Considering the fact that Chennai District and the neighbouring District were experiencing the torrential rain during the last week of November, 2021 and during the first week of December, 2021, the petitioner is directed to pay the tax determined on the consignment under both the Central Goods and Service Tax Act, 2017 and the Tamil Nadu Goods and Service Tax Act, 2017 and 25% of the penalty imposed in the impugned order.
Petition disposed off.
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2021 (12) TMI 835 - CALCUTTA HIGH COURT
Prayer to file/upload GST TRAN-1 or to permit to file revised TRAN-1 form - HELD THAT:- It is clearly clearly brought out the difficulties faced by the assesses and also as to how the assesses having substantially complied with the requirement under law and having been entitled to credit on account of transition to the GST regime which is beyond the purview of the assessee and the assessee cannot be put to prejudice on account of technicalities. Thus, keeping the underlying principle in mind if the matter is examined then we are inclined to lean in favour of the writ petitioners and affirm the directions issued by the learned Single Judge.
While pondering on the face of the issue, the decision of the Punjab and Haryana High Court in the case of HANS RAJ SONS VERSUS UNION OF INDIA AND OTHERS [2019 (12) TMI 997 - PUNJAB AND HARYANA HIGH COURT]. In the said decision the Court while allowing the writ petition had granted two options one by directing opening of the portal and in case of non-opening of portal the writ petitioner/assessee will be entitled to make unutilized credit in their GST 3B forms to be filed on the monthly basis. This will be a workable solution and the Assessing Officer will be entitled to examine the legality of the claim on such form being filed by the assessee.
The substantial part of the order and the directions issued by the learned writ Court as well as reasoning given merits acceptance - the miscellaneous appeals and the connected applications are dismissed and the order and directions issued by the learned Single Judge is slightly modified by granting liberty to the writ petitioner/assessee to file individual tax credit in GSTR-3B Forms for the month of January 2022 to be filed in the month of February, 2022 and the concerned authority/Assessing Officer would be at liberty to verify the genuineness of the claim.
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2021 (12) TMI 834 - CALCUTTA HIGH COURT
Input Tax Credit (ITC) - Constitutional validity of section 16(2)(c) of the CGST/WBGST Act - non-deposit of tax in the Government account by the suppliers which have been collected from the petitioners - main contention of the petitioners in these writ petitions are that the transactions in question are genuine and valid by relying upon all the supporting relevant documents required under law - HELD THAT:- On perusal of records available, these writ petitions are disposed of by remanding these cases to the respondents concerned to consider afresh the cases of the petitioners on the issue of their entitlement of benefit of input tax credit in question by considering the documents which the petitioners want to rely in support of their claim of genuineness of the transactions in question and shall also consider as to whether payments on purchases in question along with GST were actually paid or not to the suppliers (RTP) and also to consider as to whether the transactions and purchases were made before or after the cancellation of registration of the suppliers and also consider as to compliance of statutory obligation by the petitioners in verification of identity of the suppliers (RTP).
If it is found upon considering the relevant documents that all the purchases and transactions in question are genuine and supported by valid documents and transactions in question were made before the cancellation of registration of those suppliers and after taking into consideration the judgments of the Supreme Court and various High Courts which have been referred in this order and in that event the petitioners shall be given the benefit of input tax credit in question.
Petition disposed off.
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2021 (12) TMI 833 - PUNJAB AND HARYANA HIGH COURT
Input Tax Credit - Deposit of half of the disputed amount with the GST Authorities subject to the final adjustment within a period of ten days - HELD THAT:- It is directed that the petitioner shall join the investigation and shall fully cooperate with the investigation process and on his doing so, the petitioner be released on interim bail subject to his furnishing personal bonds and surety to the satisfaction of Arresting/Investigating Officer. However, the petitioner shall continue to join the investigation as and when called upon to do so and shall abide by all the conditions as provided under Section 438(2) Cr.P.C. It is further directed that the petitioner shall forthwith deposit his passport, if any, with the SIT.
Adjourned to 11.1.2022.
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2021 (12) TMI 832 - ALLAHABAD HIGH COURT
Cancellation of GST registration - harassment of the assessee - allegation of non-submission of electricity bill - requisite documents for grant of such registration - HELD THAT:- Section 25 of CGST Act, provides detailed procedure to be followed by every person applying for registration. It further requires by the person to provide PAN and Aadhar details. Rule 8 and 9 provides how the application for registration has to be dealt with. Further Rule 9 suggests the manner in which verification has to be done. If on examination of the application accompanying the documents all found to be in order then approval should be granted within seven working days. In the event the officer is not satisfied with the documents annexed then inspection is provided and further clarification can be sought.
In the case in hand PAN and Aadhar details as well as property receipts were provided as per the provisions of the Act and Rule. The petitioner has annexed the photocopy of the Form applied for registration as Annexure No. 1, whereas the details of PAN, Aadhar and property receipts have mentioned. PAN reference has come at page nos. 25, 28 and 29; Aadhar reference has come at page 29 and 33 as well as property reference has come at page 37 - It is clear from the records that all the documents as required under the Act and law as well as in compliance to the show cause notice were furnished by the petitioner and without pointing out any defect or short coming therein, the application should not have been rejected.
The two authorities of the State have acted only with a view to harass the petitioner which cannot be accepted at any cost. This attitude of the respondents in this petition cannot be tolerated as the officers are being State functionary has to act fairly and their action must be in consonance with the provisions of the Acts as well as Rules.
The writ petition is allowed with cost of ₹ 15,000/-, which shall be deposited before the High Court State Legal Services Committee, Allahabad within a period of 20 days from today.
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2021 (12) TMI 831 - JHARKHAND HIGH COURT
Duty drawback - refund of unutilized input tax credit - despite the verification exercise carried out in terms of Annexure 1, Circular No. 131/1/2020 GST dated 23.01.2020, the tag of risky exporter is not being removed - HELD THAT:- Matter be listed in the week of 17th January, 2022.
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2021 (12) TMI 779 - ALLAHABAD HIGH COURT
Seeking release of conveyance with goods - since the Tribunal has not yet been constituted in the State of U.P., so this writ petition has been preferred - Section 129 (1) (a) of IGST/CGST Act - HELD THAT:- The matter requires consideration.
Giving the circumstances of the present case, this case is not a fit case to issue an interim order at this stage.
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2021 (12) TMI 778 - DELHI HIGH COURT
Refund under CGST and SGST Act along with interest - difference between the adjusted total turnover in FORM GSTR-3B and FORM GSTR-01 - refund rejected without assigning any reason against which the petitioner filed an appeal - HELD THAT:- Issue notice. Mr. Sumit Batra, Advocate accepts notice on behalf of respondent no.1 and Mr. Sushil Kumar Pandey, Advocate accepts notice on behalf of respondent no.2/UOI. They pray for and are permitted to file their counter-affidavits within four weeks. Rejoinder-affidavits, if any, be filed before the next date of hearing.
List on 29th March, 2022.
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2021 (12) TMI 777 - MADRAS HIGH COURT
Principles of natural justice - it is submitted that the impugned order has been passed without uploading the order as is required under the provisions of the Tamil Nadu Goods and Services Act, 2017 read with Tamil Nadu Goods and Services Rules, 2017 - HELD THAT:- There is no merits in the submission of the counsel of the petitioner that the petitioner has not been issued with the hearing notice. Be that as it may, the petitioner has an alternate remedy before the Appellate Commissioner under Section 107 of the Tamil Nadu Goods and Services Act, 2017.
The petitioner is at liberty to file an appeal before the Appellate Commissioner under Section 107 of Tamil Nadu Goods and Services Act, 2017 within a period of thirty days from the date of receipt of a copy of this order - In case, that such appeal is filed by the petitioner within such time, the Appellate Commissioner shall pass appropriate orders on merits and in accordance with law preferably within a period of three months from the date of receipt of a copy of this order after giving an opportunity of personal hearing to the petitioner.
Petition disposed off.
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2021 (12) TMI 776 - MADRAS HIGH COURT
Revocation of cancellation of GST registration of the petitioner - Section 30 of the TNGST Act - HELD THAT:- The facts on record indicate that the petitioner was issued with a Show Cause Notice dated 24.08.2021 under Section 29 2(b) of the Central Goods and Services Tax Act, 2017. The petitioner was also directed to appear before the Superintendent on 26.08.2019. However, the petitioner failed to respond to the same and under these circumstances, an order of cancellation came to be passed under Section 29 of the aforesaid Act on 24.08.2019.
The alternate remedy available to the petitioner to file an appeal before the Appellate Commissioner under Section 107 of the Central Goods and Services Tax Act, 2017 within a period of three months from the date of communication of the order dated 24.09.2019 and within another thirty days after condoning the delay properly explaining the reasons of delay had also expired.
The time for approaching the respondent stood extended up to 31.08.2020 by which time the country was under the spell of Covid- 19 and lock down. Meanwhile, the Hon'ble Supreme Court has also passed a suo motu Writ Petition in IN RE: COGNIZANCE FOR EXTENSION OF LIMITATION [2021 (3) TMI 497 - SC ORDER] and extending the limitation. Since there was a second wave of the pandemic, the Central Board of Indirect Taxes and Customs issued the Notification No.34/2021 – Central Tax dated 29.08.2021 in partial modification of the Notification No.35/2020 – Central Tax dated 03.04.2020, extended the period for filing appropriate application of revocation of cancellation by 30.09.2021.
Considering the fact that the Government had itself taken a decision to allow the persons like petitioners to approach the respondents/appropriate authorities for revocation of the registration granted, there seems to be merits in the submission made by the learned counsel for the petitioner for allowing the writ petition Under Section 30 of the CGST Act, 2017, the petitioner is also required to file the returns along with the tax which ought to have been paid by the petitioner as a condition for entertaining the application in terms of Rule(23) CGST and TNGST Act, 2017 which is also to be complied by the petitioner.
The respondents are directed to accept the returns filed in terms of proviso 2 Rule 23 of the either Rules and facilitate the payment of tax by the petitioner - Petition disposed off.
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2021 (12) TMI 775 - MADRAS HIGH COURT
Maintainability of appeal - appeal was dismissed on the ground of time limitation - Section 107 of The Central Goods and Services Tax Act, 2017 - HELD THAT:- The facts indicate that the third respondent had passed an order dated 15.06.2020 at the time when lock down was clamped on account of the out break of Covid-19 pandemic. The petitioner has filed an appeal on 05.11.2020. After the appeal was filed, the Hon'ble Supreme Court has further extended a period of limitation vide order dated 08.03.2021 and 23.09.2021. The second respondent ought to have taken note of the same and numbered the appeal and taken up the appeal for final hearing.
This writ petition stands allowed by directing the second respondent to take up the appeal filed by the petitioner and consider the same in accordance with law and on merits within a period of sixty (60) days from the date of receipt of a copy of this order.
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2021 (12) TMI 774 - AUTHORITY FOR ADVANCE RULING, MAHARASHTRA
Levy of GST - supply or not - part recovery of 'renting of motor vehicles services'/'cab services' from employees in respect of the transport facility provided to them - valuation of supply keeping in mind that employee and the applicant are related party as per provisions of GST law - admissibility of ITC in respect of GST paid on inward supply of 'renting of motor vehicles service' which are used for the employee - HELD THAT:- GST is discharged on the gross value of bills raised on the applicant by the third party vendors. We also observe that the partial amounts recovered by the applicant from its employees in respect of use of such transport facility are a part of the amount paid to the third party vendors which has already suffered GST. Therefore, in the subject case, the applicant is not providing transportation facility to its employees, in fact the applicant is a receiver of such services.
For applicant, arranging the transport facility for their employees is definitely not an activity which is incidental or ancillary to the activity of software development, nor can it be called an activity done in the course of or in furtherance of development of software as it is not integrally connected to the business in such a way that without this the business will not function.
As arranging transport facility to its employee is not a supply of service, accordingly the remaining questions become redundant and merit no discussion - application disposed off.
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2021 (12) TMI 773 - AUTHORITY FOR ADVANCE RULING, MAHARASHTRA
Levy of GST - Valuation - Electricity charges and Water charges paid by the Applicant as per meter reading and collected from the recipients at actual on reimbursement basis - Pure agent or not - scope of supply - addition of value of Electricity and Water charges to the monthly License Fee if as per terms of the contract tenant user is paying for such utility services directly to the Service Provider i.e. Electricity Power Distributor/BMC - HELD THAT:- The applicant has agreed to lease out the premises which is an immovable property. As per entry no. 5 (a) of Schedule II. Renting of Immovable Property is a supply of services and liable to tax under the provisions of GST Act. The utilities such as electricity and water supply are basic amenities subject to which competent authority will not issue occupancy certificate for conducting commercial activities/ business - The payment of rent is fixed on monthly basis which is for the occupancy and also the use of the premises whereas the variable amount of electricity and water charges (at actuals), paid by the Licensee, is for effective enjoyment of the rented premises without which the occupation of the premises could not be possible. Thus, the provision of essential services is mandatory on landlord and it is not mere facilitating the payment of electricity charges by the licensor.
The value of supply includes incidental expenses charged by the supplier in respect to renting of premises for the purpose of levy of tax except for subsidies provided by the Government and the value of discount. Therefore, the charges for electricity and water charges recovered as reimbursements, even if at actuals, have the nature of incidental expenses in relation to renting of immovable property and are includible in the value of supply and are to be considered as transaction value for the purpose of levy of tax - The concept of a “pure agent” under GST Laws is covered under the provisions of Rule 33 of CGST Rules, 2017 and as per the said Rule 33, the expenditure or cost incurred by a supplier, as a pure agent of the recipient of the supply shall be excluded from the value of supply. However, such exclusion of expenditure incurred as a pure agent is possible only where certain conditions as mentioned in the said Rules are fulfilled and benefit is available only if the conditions stipulated in the rules are satisfied by the supplier.
In the instant case, the main electric meter is in the name of the Applicant ; the service is not acquired from main supplier of electricity on the instructions from the tenant and thus the applicant does not act as pure agent of tenant in this respect. Even after the tenant leaves the premises, the main electric (or main water) meter is going to remain in the name of the Applicant. The supply under the main meter is not due to instructions from any particular tenant. With regards to a 'pure agent', the applicant contends that the reimbursement of expenses, such as electricity charges, water supply charges etc. incurred by it and received from lessee are towards payment to the third party suppliers. In present case the applicant has got the main electric connection in its own name and has created different sub connections at each location to know the actual consumption of electricity and water charges by the tenants which are to be apportioned/recovered from them as per floor space occupied. All these activities show that these supplies are on applicant's own account and is for effective enjoyment of premises.
The reimbursed electricity and water charges charged to the licensee by issuing debit note or paid by the licensee is considered monthly License fee and total value along with fixed monthly rent is to be considered as transaction value of rent for the purpose levy of tax under GST Act.
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