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2018 (9) TMI 1477 - AAR - GSTClassification of services - rate of GST - person liable to discharge GST - mining lease for extracting “Stone along with associated minor minerals” - annual dead rent or royalty. What is the classification of service provided in accordance with Notification No.11/2017-CT (Rate) dated 28.06.2017 read with annexure attached to it, by the State of Haryana to M/S Pioneer Partners for which royalty is being paid? - Whether said service can be classified under 9973 specifically under 997337 as Licensing services for the right to use minerals including its exploration and evaluation or as any other service? - Held that:- A perusal of classification of services shows that services of right to use natural resources classify under tariff 9973 and since description of services under serial no. 17 (i) to (v) does not cover such services of right to use minerals therefore, it would fall under the residual entry at serial no. 17(viii). Being so, the rate of tax applicable on such services, as provided therein, shall be the same rate of tax as applicable on supply of like goods involving transfer of title in goods. What is the rate of GST on given services provided by State of Haryana to M/s. Poineer Partners for which royalty is being paid? - Held 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 - That the minerals which are extracted from the mine are classifiable under Tariff Heading 2516 and leviable to GST @ 5%. Whether services provided by State Government of Haryana is governed by applicability of Notification No 13/2017-CT (Rate) dated 28.06.2017 under entry number 5 and whether M/s. Poineer Partners is taxable person in this case to discharge GST under reverse charge mechanism or whether given service is covered by exclusion clause number (1) of entry no 5 and State Government of Haryana is liable to discharge GST on same? - Held that:- The applicant has misconstrued the entry which in fact casts a liability of tax to be discharged by the recipient on reverse charge basis - the applicant is liable to discharge the tax liability on such services provided to it by the Government on reverse charge basis. Ruling:- The services for the right to use minerals including its exploration and evaluation, as per Sr. No. 257 of the annexure appended to notification no. 11/2017-CT (Rate), dated 28.06.2017 is included in group 99733 under heading 9973. The royalty/dead rent paid/payable to the Government by the applicant is consideration against the transfer of right to use minerals including its exploration and evaluation as per the lease granted by the Government to the applicant. The services for the right to use minerals including its exploration and evaluation, as per Sr. No. 257 of the annexure appended to notification no. 11/2017-CT (Rate), dated 28.06.2017 is included in group 99733 under heading 9973. Hence it attracts the same rate of tax as on supply of the like goods involving transfer of title in goods. As per notification no. 1/2017-CT (Rate), dated 28.06.2017 under the CGST Act, 2017 and the corresponding State Tax notification under HGST Act, 2017, Schedule-I the stone boulders extracted by the applicant attract 5% GST (2.5 % CGST+ 2.5% HGST) as covered under HSN 2516 (At sr. No. 124 of the notification). As per entry no. 5 of the Notification No 13/2017-CT (Rate), dated 28.06.2017 under the CGST Act, 2017 and the corresponding Notification No. 48/ST-2 Dt. 30.06.2017 under the HGST Act, 2017, the recipient of such services, i.e., the applicant is liable to discharge the tax liability on such services provided to it by the Government on reverse charge basis.
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