Recent Advance Rulings

[PRABHAKAR KS]

Issues & Jurisdiction - Before the Authority
Sub-section (2) of Section 97 & Sub-Section (1) of Section 100 of the Central GST Act, 2017 deals with certain definite questions that are eligible to raise before the AAR/AAAR. They are: 

1. Whether an applicant is required to be registered or not.
2. Classification of any goods or services or both.
3. Applicability of a Notification issued under the Central GST Act, 2017.
4. Determination of time and value of supply of goods or services or both.
5. Admissibility of Input Tax Credit (ITC).
6. Determination of the tax liability on any goods or services or both, etc.

1. Applicant – M/s. Tamil Nadu Edible Oils (P) Ltd., Advance Ruling No. 21/ARA/2019 dated 21.05.2019 [2019 (8) TMI 28 - AUTHORITY FOR ADVANCE RULING - TAMIL NADU]

The applicant is a Chennai based dealer of Edible Oils. The applicant has moved AAR – Tamil Nadu on the following question - Whether e-way bill is required for consignments pertaining to multiple invoices to multiple customers moved in the same conveyance, in which the value of each invoice is less than the limits for generation of e-way bill but in aggregate, the value of the multiple invoices exceeds the specified limit?

As said in the introductory para, the GST Law restricts the AAR to decide a certain set of issues under Section 97 (2). Since the above said issue before the Authority is sought on the 'provisions of e-way bill' not in the ambit of the authority, the Application was rejected stating the lack of jurisdiction.

2. Applicant – Sri. Rajendrababu Ambika, Advance Ruling No. 22/AAR/2019 Dated 22.05.2019 [2019 (7) TMI 809 - AUTHORITY FOR ADVANCE RULING, TAMILNADU]

The applicant under the name & style M/s. Sri. Dhanalakshmi Welding Works is engaged in the business of manufacturing, erection, commissioning, reconditioning, repairing and maintenance of milk dairy machinery and equipment.  The applicant has moved AAR – Tamil Nadu with four questions, they were –

1. Whether their dairy machinery works is liable to tax at 12 % (HSN 8434) or 18 % (HSN 8413)
2. In dairy machinery works includes milk processing, milk chilling, refrigeration system, milk handling equipment, milk packing equipment and milk allied product making machinery. For such supply and erection of dairy machinery, it involves service charges also. If so what will be the rate of tax on the service charge component?
3. Whether their nature of activities fall under works contract or not. If so what will be the rate of tax and its HSN code? Also inform the details of entries to be made in monthly return GSTR l ?
4. Whether E-way bill procedures applicable for their business activities?

After examining the statement of facts, supporting documents filed by the Applicant and comments furnished by the Commissioner, the AAR has given the following Ruling -

1. Due to absence of supply related details, the applicable classification as far as dairy machinery concerned did not pronounce.
2. The activity of Supply undertaken by the applicant is classifiable under SAC 998717 and the applicable rate of tax is 9% under Central GST and at 9% under State GST as amended.
3. Since question No (3) & (4) are purely in procedural aspects, did not answer. The AAR also held that the activity of the above applicant did not qualify as ‘Works Contract’ defined under Section 2 (119) of the CGST or State GST Act, 2017.

3. Applicant – M/s. Bauli India Bakes & Sweets (P) Ltd., Advance Ruling No. GST – ARA-108/2018-19/B-36-Mumbai Dated 08.04.2019 [2019 (7) TMI 40 - AUTHORITY FOR ADVANCE RULING, MAHARASHTRA]

The applicant is a registered company was early engaged in the business of trading in bakery products and later setup a factory for manufacture of such goods with all due permission from the erstwhile Central Excise Department during December 2016 and started the commercial productions during September 2017. With the implementation of GST w.e.f 1^st July, 2017 the applicant moved the AAR – Maharashtra with two questions, they were -    

1. Whether the ITC availed by the applicant in case of capital goods received prior to 1st July 2017 is admissible to the applicant?
2. Whether while determining the liability to pay tax on the outward supplies made by the applicant, the applicant can adjust the ITC in respect of capital goods procured by it prior to 1st July, 2017?

Since the above said issues or questions were relating to availment of ITC paid on the capital goods i.e. plant and machinery under pre-GST regime and outside the purview of the AAR, the AAR has rejected the application.

To be continued….