TMI Blog2019 (7) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... , the procedure to be followed for payment of IGST as the GST portal does not permit the payment of IGST where the place of supply is indicated as state of Maharashtra? - HELD THAT:- This question is not answerable as IGST is not applicable. - GST-ARA-117/2018-19/B-45 - - - Dated:- 26-4-2019 - SHRI B. TIMOTHY, AND SHRI B.V. BORHADE, MEMBER PROCEEDINGS (Under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017) The present application has been filed under section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as the CGST Act and MGST Act respectively] by M/s. BILCARE LIMITED, seeking an advance ruling in respect of the following questions. 1. Determining whether the various services provided to foreign clients i.e. situated outside India and for which the place of supply is in the taxable territory shall be liable to Integrated Tax (herein referred to as IGST ) or Central Goods and Service Tax (herein referred to as CGST ) and State Goods and Service Tax (herein referred to as SGST ) for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture of services provided: 1. Under Storage and Distribution Services quotation, applicant provides services of receipt, storage, distribution, return destruction of IPS (Investigational Products Drugs) in India. (Refer Annexure 1 (Pages 11 to 16) of standard quotation - Pages: 2 to 3 of Storage and Distribution Services quotation for detailed explanation of nature of services). For a brief description of the services provided refer Table 1 below: Table 1: Services No. of Units Unit Rate in USD Total Cost in USD Cost Assumptions Logistic Project Management Fees 21 590 12390 This is the cost of Logistic Project Management fees for 21 months and it will be charged based on utilization per month @ USD 590. (From period Apr 2017 to Dec 2018) Receipt Reconciliation fees 2 148 296 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessing fees would be charged on the basis of number of shipments per shipment @USD 200. Freight Charges (2-8 Deg C) 48 459 22032 These are the freight charges for 48 shipments to site in India. Each shipment will be with 1 shipper. (Shipments.at 2 to 8 Deg C in Validated shipper with one temperature monitoring device) Note: Gov. service tax will be extra @ 15% Freight Charges for return shipment (2-8 Deg C) 20 459 9180 These are the freight charges for 4 return shipments from site to Bilcare depot. Each shipment will be with 1 shipper. (20 shipments at controlled temperature condition with validated shipper with temperature monitoring device either for redistribution or as PK retains) Note: Gov. service tax will be extra 15% Return Receipt Reconciliation (2-8 Deg C) 20 148 2960 This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Preparation of label proofs 3. Printing of New Retest Date Labels 4. Label Inspection and Release 5. Printing of Total 210 labels 6. Label language: English Note: Tamper seals will be provided by PPD 252.00 Storage Cost (Shelf- Labels) Storage cost includes storage of labels for 1 month during packaging run. The storage of labels will be charged as per actual utilization @ USD 83 per shelf per month. 83.00 Total Cost in USD 4,026.00 Add Government Service Tax @ 15% in USD 603.90 Grand Total in USD (Including Government Service Tax 15%) 4,629.90 A. Question 1 : Common for all the above-mentioned nature of services provided Determining whether the various services provided to foreign clients i.e. situated outside India and for watch the place of supply is in the taxable t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2) (3) (4) (5) Therefore, for the purpose of levying IGST or CGST and SGST on a supply we first need to determine whether the supply is an Intra-State supply or Inter-State supply of services. Sections 7 8 of the IGST Act, 2017 deals with determination of the nature of supply: 4. Both, Section 7 Section 8 determines the nature of supply having regard to the location of supplier and place of supply . In the instant case, the location of supplier, location of service recipient and place of supply is as below: a. Location of supplier of service - The location of supplier (i.e. the applicant) is in Pune. Further, the applicant is registered under GST in the State of Maharashtra. b. Location of recipient of service - The location of recipient is outside India. Further, the service recipients are Pharmaceutical Companies or a CRO (Clinical Research Organization) situated outside India. c. The Place of supply- Since the service recipient is located outside India, place of supply of services provided shall be determined as per the provisions of Section 13 of the IGST Act. Further, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the various books and case laws as mentioned above is attached as Annexure-2. II. As mentioned in point 4(c) above, the place of supply for the services provided by the Applicant will be determined as per the provisions of sub-sections of Section (13)(3) of the IGST Act. Hence, for determining whether the services provided by the Applicant is inter-state or intra-state , Section 8(2) will not apply. III. Provisions of Section 7(5)(C) of the IGST Act, specifies that - supply of services in the taxable territory which is not an intra-state supply, and which is not covered elsewhere shall be treated as inter-State supply. The said section is reproduced below: (5) Supply of goods or services or both, - (a) when the supplier is located in India and the place of supply is outside India; (b) to or by a Special Economic Zone developer or a Special Economic Zone unit; or (C) in the taxable territory, not being an intra-State supply and not covered elsewhere in this section, shall be treated to be a supply of goods or services or both in the course of inter State trade or commerce. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge of PK retains received from the site at the end of the study, pick and pack services for shipment to Ireland depot, freight charges for return shipment, return receipt and reconciliation per site, retention of project specific documents. (b) The packaging services provided includes primary packaging such as blistering, bottling, liquid and ointment filling of tablets, liquids, ointments, creams, etc.. and secondary packaging such as labelling, kitting, block box preparation, cartoning, etc. of primary packed material and also storage distribution and destruction of primary and secondary packed material. The applicant M/s. Bilcare Ltd, is having the place of business and is registered in State of Maharashtra under the GST Law. Thus, the location of the supplier is in India but the location of recipient of the services is outside India. In order to classify service as export of service as per sub-clause (iii) of sub-section (6) of Section 2 of the integrated Goods and Services Tax Act, 2017, the place of supply of service should be outside India. Since the applicant, being supplier of service is located in India and. its recipient is located outside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... includes Labelling, Kitting, Block Box Preparation, Cartoning, etc. of Primary packed material and also storage, distribution and destruction of primary and secondary packed material if required by the client. Based on the above, applicant is seeking ruling in respect of two questions mentioned above. We shall now deal with each question separately- Ques 1- . Determining whether the various services provided to foreign clients i.e. situated outside India and for which the place of supply is in the taxable territory shall be liable to Integrated Tax (herein referred to as 1GST ) or Central Goods and Service Tax (herein referred to as CGST ) and State Goods and Service Tax (herein referred to as SGST ) for the purpose of levy of Goods and Services Tax (GST) under the GST Law. The answer to the above question can be found in the Section 13 of the IGST Act, 2013 which is reproduced below: Section 13 --------- 13. (1) The provisions of this section shall apply to determine the place of supply of services where the location of the supplier of services or the location of the recipient of services is outside India. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In case it is ruled that IGST is payable, the procedure to be followed for payment of IGST as the GST portal does not permit the payment of IGST where the place of supply is indicated as state of Maharashtra. The question is not answerable as IGST is not applicable. 06. In view of the extensive deliberations as held hereinabove, we pass an order as follows: ORDER (Under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017) NO.GST-ARA-117/2018-19/B-45 Mumbai, dt. 26-04-2019 For reasons as discussed in the body of the order, the questions are answered thus - Question: - 1. Determining whether the various services provided to foreign clients i.e. situated outside India and for which the place of supply is in the taxable territory shall be liable to Integrated Tax (herein referred to as IGST ) or Central Goods and Service Tax (herein referred to as CGST ) and State Goods and Service Tax (herein referred to as SGST ) for the purpose of levy of Goods and Services Tax (GST) under the GST Law. Answer: - As per above discussi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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