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2024 (3) TMI 624 - APPELLATE AUTHORITY FOR ADVANCE RULING, WEST BENGALLiability to charge GST - Public Distribution System (PDS) - Fair Price Shop - Supply of goods i.e. S. K. Oil to ration card holders - license issued by the Government of West Bengal, authorizing as a “Dealer” as defined under Kerosene Control Order, 1968 - composite supply - HELD THAT:- The appellant purchases S.K. Oil from agents of the Oil Companies who have an agreement with the concerned Oil Marketing Company. The agents have been granted a licence authorizing him/her to carry on trade in Kerosene as Agent. Also, the appellant is obligated as a Dealer to comply with the provision of the West Bengal Kerosene Control Order, 1968, Notification No. 2567/FS/FS/Sectt/Sup/4M-16/2014 dated 03/11/2014 issued by the Department of Food and Supply, Government of West Bengal. Memorandum No. DCG-16016(99)/l/2022-SEC(DCG)-DCG-Part(l)/711 dated 13.05.2022 fixes the price of S. K. Oil at which the agent will sell S. K. Oil to the dealers and the retail price of S. K. Oil at which the Dealers will sell S. K. Oil to the consumers, i.e. the Ration Card holders. (i) Whether the applicant being a Fair Price Shop as defined under the Notification No. 2565/FS/FS/Sectt/Sup/4M-16/2014 dated 3rd November 2014 issued by the Government of West Bengal, is liable to charge GST from the State Government against the supply made by them? - The appellant in the present case, is a Fair Price Shop and is providing service to the State Government by way of distributing of S. K. Oil as agent, it decided that the afore-mentioned notification is applicable for the appellant and the appellant is entitled for the benefit extended by the said notification. Since, in terms of the said Notification, the Tax liability of the appellant while providing service to the State Government is ‘NIL’ the question of charging GST from the State Government becomes inapplicable. (ii) Whether the other charges like Dealer’s commission, Dealers Transport Charges, Stationery Charges, H&E Loss etc. would be chargeable to GST or treated as exempt? - Appellant’s sale price included components such as dealer’s commission, dealer’s transport charges, stationery charges, Compensation for Handling and Evaporation loss, among others, in order to guarantee a reasonable return on the capital invested and are actually Commission received by the appellant from the State Government. The government is able to regulate the price of S. K. Oil disseminated via PDS by granting these terms in this manner. In terms of Chapter 4 of the GST Rules, The value of supply of goods between the principal and his agent (iii) Whether the supply of “S.K. Oil” along with charges would be treated as a composite supply wherein the principal supply would be the supply of “S.K. Oil”? - Supply of “S.K. Oil” along with charges shall not be treated as a composite supply. The supply made by the appellant in the instant case, is supply of Service to the State Government. The appellant makes a single supply of service as an agent to the State Government by way of distributing S. K. Oil to the ration card holders. As a result, we conclude that no additional discussion is necessary, and this case does not qualify as “Composite Supply” under the GST Act of 2017.
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