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2019 (1) TMI 1848 - AAR - GSTRate of GST - Mineral mining rights in lieu of which Royalty is being paid - at what GST rate should it discharge its GST liability whether at the rate of 5% (Rate applicable on extracted raw material) or 18% (Residual category)? - Applicability of the future GST liability, out of excess GST paid on such Mineral Mining Rights at the rate of 18% in the past - HELD THAT:- The mining contract has been awarded to the applicant for right to use minerals namely “Stone along with associated minor minerals”. Hence, it is argued that the services received by the applicant from state government in respect of grant mining contract are classifiable under sub heading 997337 as covered under entry 257 of the annexure appended to the notification No. 11/2017-CT (Rate) dated 28.06.2017. Further, GST on the said supply of services is payable according to the entry at sr. no. 17 of the table in said notification - Since a perusal of classification of services of right to use natural resources classify under tariff 9973 and since description of services under serial No. 17 (i) to (vii) does not cover such services of right to use minerals, therefore, it would fall under the residual entry at serial number 17 (viii). Being so, the rate of tax applicable on such services, as provide therein, shall be the same rate of tax as applicable on supply of like goods involving transfer of title in goods. Thus, it is evident that service charge by way of annual dead rent or royalty paid for services of granting right to use mineral would attract GST rate as applicable on supply of mineral which is being extracted through such mining - in view of entry at sr. no. 5 of the CGST notification no. 13/2017-CT (Rate) dated 28.06.2017, GST is payable on reverse charge basis by the recipient of above services i.e. the applicant in the present case.
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