TMI Blog2019 (8) TMI 1282X X X X Extracts X X X X X X X X Extracts X X X X ..... nd medical facilities are proved by the applicant to its employees for their personal use. Therefore, as per Section 17 (5) (g) of CGST/TNGST ACT, input tax credit is not available for the medicine that the applicant is procuring for the consumption of its employees and pensioners and their dependents. The applicant has stated in their application that these are not goods for personal consumption as the applicant pays for the same - The argument does not hold - The fact of who pays for the medicines here is irrelevant to the usage of the said medicines. They are used by the employees and dependents and hence are for personal consumption and the applicant is ineligible to take input tax credit on the inward supply of medicines used to provide health facilities to its employees in its hospital. The applicant is not entitled to take credit of input tax charged on the inward supply of medicines which are used to provide medical facilities to the employees, pensioners and dependents in the in-house hospital. - Order No. TN/31/AAR/2019 - - - Dated:- 25-7-2019 - MS. MANASA GANGOTRI KATA IRS., AND THIRU KURINJI SELVAAN V.S., MASC., (AGRI.), M.B.A., MEMBER Note : A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt Trusts Act, 1963 vide notification No. GST(E) dt. 01.02.1975. The affairs of the applicant are administered by a Board constituted by the Central Government from time to time as per the provisions of Major Port Trusts Act, 1963. The applicant is functioning under the administrative control and supervision of Ministry of shipping of Government of India. The Statement of facts on the questions raised by the applicant is as under: 3. The applicant in Application ARA No. 28, has stated that as a part of Service Rules, they are providing health and medical cover to its employees and pensioners. For this purpose, the Central Government has notified the following two regulations under section 124(1) r.w.s 132(1) of Major Port Trusts Act, 1963. i. Chennai Port Trust Employees (Contributory Outdoor and Indoor Medical Benefit After Retirement) Regulations, 1989- notified vide Notification No. GSR 605 (E) dated 08.06.1989. ii. Chennai Port Trust Employees (Medical Attendance in the Trust's Hospital and reimbursement of Hospital Charges) Regulations 1994 notified vide Notification No. GSR 51 (E) dt.01.02.1994. The applicant is maintaining an in-ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o substantiate that the free medical facilities provided by them arc as per the service conditions. Further, the applicant furnished CESTAT, Mumbai Bench order in case Hindustan Coca Cola Beverages(P) Ltd Vs Commissioner of Central Excise, Nashik = 2014 (12) TMI 596 - CESTAT MUMBAI wherein the Tribunal has held that the outdoor catering services provided by an employer to employee is qualified to avail CENVAT credit 5.1 As requested by the applicant and on account of change in the SGST Member of the authority, another personal hearing was extended on 22.02.2019. The applicant appeared through their Authorised Representative and stated as follows: They have a hospital facility inside the Chennai Port Trust which is used by employees. They will furnish the details of the Hospital regarding the registration of the same, employee contract, documents/invoices for provision of health services for employee and kin, financial documents, balance sheets, statements showing how income from hospital is accounted in the Chennai Port Trust. The applicant undertook to submit the documents in 2 weeks. The State jurisdictional officer appeared and submitted written ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not eligible to claim ITC on inward purchases of medicines to be supplied to their employees and pensioners for the reason that this activity is not their part and parcel of their activity and supply of medicines without any consideration amount to free supply, hence the applicant is not eligible for Input Tax Credit. 7. We have carefully considered the submissions made by the applicant in the advance ruling application, the additional submissions made during the personal hearings and the comments furnished by the State Jurisdictional Officer. The applicant has stated that the Chennai Port Trust Hospital was started originally as a dispensary in 1939. Based on the Industries (Development and Regulation) Act 1951, the hospital started functioning as a full-fledged hospital. The applicant has an in house hospital for its employees, their dependents, pensioners and family pensioners for in-patient and out-patient treatments. They are governed by Two regulations under Section 124(1) read with section 132(1) of Major Port Trusts Act 1963, which are (i) Chennai Port Trust Employees' (Contributory Outdoor and Indoor Medical Benefit After retirement) Regulations, 1989; (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... center where all the services and medicines are provided free to the employees. No consideration is charged from the employees for this. This provision of free medical care is mandatory as per the Regulations made under Major Ports Act. These are mandated to be provided to the applicant's employees, their dependents, pensioners and family pensioners for their own in-patient and out-patient treatments. These treatments include medicines which are also provided free of charge to the employees for their personal use. The medicines and medical facilities are proved by the applicant to its employees for their personal use. Therefore, as per Section 17 (5) (g) of CGST/TNGST ACT, input tax credit is not available for the medicine that the applicant is procuring for the consumption of its employees and pensioners and their dependents. The applicant has stated in their application that these are not goods for personal consumption as the applicant pays for the same. The argument does not hold. The fact of who pays for the medicines here is irrelevant to the usage of the said medicines. They are used by the employees and dependents and hence are for personal consumption and the applica ..... X X X X Extracts X X X X X X X X Extracts X X X X
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