TMI Blog2019 (2) TMI 922X X X X Extracts X X X X X X X X Extracts X X X X ..... ded therein, shall be the same rate of tax as applicable on supply of like goods involving transfer of title in goods. 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 - That the minerals which are extracted from the mine are classifiable under Tariff Heading 2516 and leviable to GST @ 5%. The applicant has misconstrued the entry which in fact casts a liability of tax to be discharged by the recipient on reverse charge basis on licensing services for the right to use minerals including its exploration and evaluation. - AAR No. HAR/HAAR/R/2018-19/05 (In Applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. That under para 5 to part-Ill of the executed lease deed the Mode of payment of dead rent/royalty and surface rent has been decided wherein it has been agreed that a. The applicant shall deposit one advance instalment of dead rent before commencement of mining operations. b. Royalty on the mineral excavated and dispatched at the rate specified in the first schedule or dead rent, whichever is more and not both on monthly basis. 6. That in compliance to the said lease agreement the applicant has paid annual dead rent or royalty as the case maybe. 7. That in accordance to the said lease deed the applicant is required to deposit a monthly and an annual return in specified format i.e. MMPI and MMP2 respectively wherein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the applicant. It has been stated that the applicant is against is the business of mining of boulders and extraction minor minerals in village Mankawas-2 , District Bhiwani and is supplying the same under Tariff Heading 2516 attracting 5% GST (2.5% CGST + 2.5% HGST). As per section 9 (3) of the HGST Act, 2017 GST is payable on the royalty amount under RCM by the recipient of such services. The royalty/lease deed comes under the category of supply of services and general rate of tax @18% is applicable. Record of Personal Hearing None had appeared for personal hearing. However, PH in the case was afforded for 10.07.2018 which was re-fixed for 25.07.2018 on request received through e-mail. On 23.7.2018 another e-mail was receiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged. 3. That in exercise of power conferred under Section 9(1) of the CGST Act 2017, notification number 11/2017-CT (Rate) dated 28.06.2017 has been issued which notifies the central tax, on intra-state supplies of service description along with Tariff Heading in accordance with the scheme of classification is specified which are subject to specific conditions. 4. That along with the notification number 11/2017-CT (Rate) dated 28.06.2017, an annexure has also been appended with it which at Serial No.257 specify that the Group 99733 includes sub heading 997337 which is for:- Licensing services for the right to us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is also the stand of the applicant that in view of Sr. No.5 of notification no. 13/2017-CT (Rate) dated 28.06.2017, the recipient of service is not liable to discharge any GST. In our considered view, the applicant has misconstrued the entry which in fact casts a liability of tax to be discharged by the recipient on reverse charge basis on licensing services for the right to use minerals including its exploration and evaluation. Advance ruling under section 98 of the CGST/HGST Act 2017 In the backdrop of above discussions and findings the advance ruling on the questions is pronounced as under: - 1. What shall be the classification of service provided by the State of Haryana to M/S United Mining Corporation in accordance wit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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