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2019 (5) TMI 701

9 of the GST Act - transactions where the payment had not been made by account payee cheque or account payee draft or through electronic banking clearance - HELD THAT:- In the present context, ‘consideration’, as defined under section 2(31), provides the scope and ambit for modes of payment. It includes, in relation to the supply of goods or services, any payment, made or to be made, whether in money or otherwise, and also the monetary value of any act or forbearance. This definition of ‘consideration’ cast the net so wide that almost no form of payment is excluded. The recipient can pay the supplier consideration by way of setting off book debt. Unless the law specifically restricts the recipient from claiming th .....

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time as mentioned in the proviso to Section 100 (2) of the GST Act. Every such Appeal shall be filed in accordance with Section 100 (3) of the GST Act and the Rules prescribed thereunder, and the Regulations prescribed by the West Bengal Authority for Advance Ruling Regulations, 2018. 1. Admissibility of the Application 1.1 The Applicant is engaged in the manufacturing and retailing of jewellery and articles made of gold, silver, platinum, diamonds and other precious stones under the brand name Senco Gold & Diamonds . Apart from his own retail stores, the Applicant also maintains a network of franchisee-operated stores. He grants such a franchisee the right and license to operate a showroom and to use, in connection therewith, certain .....

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hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his output tax liability, along with interest thereon, in such manner as may be prescribed. 2.2 The Applicant argues that apart from the above proviso, the GST Act nowhere makes availing of input tax credit dependent upon the payment to be made for the inward supply. The captioned proviso also does not prescribe or restrict the mode in which the payment has to be made. The Applicant submits that payment through adjustment of the books of accounts is a prevalent commercial practice. Para 42 of Indian Accounting Standard 32 provides that a financial asset and a financial liability shall .....

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the above provisions make it clear that all transactions of the supplier and the recipient should be made through the online banking system. Therefore, the recipient is ineligible to claim credit of input tax if the payment is made by way of book adjustment instead of through any banking channel. 4. Observation & Findings of the Authority 4.1 Section 49(1) deals with the manner in which the supplier shall make payment of tax, interest etc. to the Government to be credited to his electronic cash ledger. The Applicant has made no submission that he intends to deposit tax to the Government in any other manner. 4.2 Section 49(2) provides that the input tax credit as self-assessed in the return of the registered person shall be credited to .....

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igations. The most common asset class used for such payment is money, although other assets unless specifically excluded by law, may be used provided the payee accepts payment by such assets other than money as good and sufficient discharge of the obligation. Of course, in the payer s books of accounts, such transfer will be reported as a reduction in the book value of the asset being transferred. 4.5 In the present context, consideration , as defined under section 2(31), provides the scope and ambit for modes of payment. It includes, in relation to the supply of goods or services, any payment, made or to be made, whether in money or otherwise, and also the monetary value of any act or forbearance. This definition of consideration cast the .....

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