TMI Blog2019 (10) TMI 872X X X X Extracts X X X X X X X X Extracts X X X X ..... UNDER SECTION 98(4) OF THE CENTRAL GOODS SERVICES TAX ACT, 2017 AND UNDER 98(4) OF THE KARNATAKA GOODS SERVICES TAX ACT, 2017 1. M/s Springer Nature Customer Service Centre GmbH, (called as the Applicant hereinafter), having GSTIN number 9917DEU29001OS7, has filed an application for Advance Ruling under Section 97 of the CGST Act, 2017 and Section 97 of the KGST Act, 2017, in FORM GST ARA-01 discharging the fee of ₹ 5,000-00 each under the CGST Act and the KGST Act. 2. The Applicant is a provider of OIDAR services and is registered under the Goods and Services Act, 2017. The applicant has sought advance ruling in respect of the following question:- a) Whether the applicant is required to charge GST on supply of OIDAR services to only unregistered persons in India in view of compulsory or mandatory registration and return filing requirement as per section 24(xi) of CGST Act, Rule 64 of CGST Rules and GST Flyer issued by Directorate General of Taxpayer Services, CBIC? b) If response to the above is No , whether the applicant is required to charge GST on supply of OIDAR services to Government, Local Authority, Governmental Author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stomers. The Sales Service entities invoice the customers and, after deduction of a commission fee, subsequently transfer the revenue to the Publisher entities within SNG. b. The Group s content is made available to customers in form of books and journals - printed and electronic. Such books and journals are also available through online platforms owned by the Group. The supply of electronic books and journals including allowing access of Group s content electronically by the applicant to customers in India and its taxability in the hands of applicant under applicable provisions of GST is being discussed in this application. c. The main purchasers of the Group s books and journals sold by the applicant are libraries, corporations, medical organisations and research institutions across the world and also a large number of individuals. The ultimate end-user of applicant s books and journals inter-alia are scientists, researchers, academicians, professionals and students. Scientific documents are available in several disciplines including the following:- a. Biomedicine b. Business and management c. Chemistry d. Computer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , an individual or any other person not registered and receiving online information and database access or retrieval services in relation to any purpose other than commerce, industry, or any other business or profession, located in taxable territory. 4.4 Section 24(xi) of the CGST Act, 2017 provides for mandatory registration under GST for every person supplying online information and database access or retrieval services from a place outside India to a person in India, other than a registered person. 4.5 The applicant states that, in summary, the above mentioned provisions states that in case of supply of OIDAR services by a person located in a non-taxable territory (i.e. the applicant in the present case) to a non-taxable online recipient, the overseas supplier of OIDAR services is liable to register compulsorily and is required to pay GST. Further, a person providing OIDAR services from a place outside India is required to file returns only when services are supplied to a person other than a registered person (i.e. an unregistered person) as per Rule 64 of the CGST Rules, 2017. 4.6 The applicant is providing e-books / journals through internet to var ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not-registered under GST Law in India. (e) The purpose for which the services are used in India is immaterial for the above provisions. 7. Regarding the definition of Non-taxable Online recipient, the applicant states that the definition prescribes the following conditions for any person to qualify as NTOR: (a) The recipient is a government, local authority, governmental authority, individual or any person who is not registered (b) The above person must be using OIDAR services in relation to any purpose other than commerce, industry, or any other business or profession, located in taxable territory. 7.1 Further, as per section 24(xi) of CGST Act and Rule 64 of CGST Rules, the overseas supplier of OIDAR services is required to obtain registration and file GST returns only in case the recipient of such supply is a person not registered under GST. (Actually it is only for compulsory registration and not for regular registration) 7.2 The applicant states that from the combined reading of GST provisions, any registered person under GST (whether such person is government, local authority, governmental authority, individual or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether they are used for the purposes other than business. The applicant states further that in view of the scientific nature of majority of the content in the books, journals, etc. supplied electronically by the applicant, it is implicit that such electronic content is not for the purpose of casual reading or for pleasure. The scholarly content in scientific, technical and medical disciplines sold by the applicant is technical in nature and is used by research and educational institutes, by professionals and corporates for furtherance of their technical knowledge. Therefore, in almost all supplies by the applicant, the use could be assumed for either business or industry or profession or commerce. 8. FINDINGS 8 DISCUSSION: We have considered the submissions made by the applicant in their application for advance ruling as well as the additional submissions made by Sri. Shashi Mathews, Advocate, during the personal hearing. We also considered the issues involved on which advance ruling is sought by the applicant and relevant facts. At the outset, we would like to state that the provisions of both the CGST Act and the KGST Act are the same except for certain pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recipient, the liability to pay tax rests on the person located in the taxable territory under reverse charge basis under Notification No. 10/2017-Central Tax (Rate) dated 28.06.2017 and such person is liable for registration compulsorily under Section 24(iii) of the CGST Act, 2017. 8.5 The burden of proving that the a unregistered person located in the taxable territory has received OIDAR services for the purposes other than for business, commerce, industry or profession lies on the applicant. 9. In view of the foregoing, we rule as follows RULING A. The applicant has to charge GST on the supplies of OIDAR services made to unregistered persons in taxable territory for the purposes other than commerce, industry, business or profession. B. The applicant is not required to charge GST on the OIDAR services made to Government, Local Authority, Governmental Authority and an individual, if they are registered persons. C. The applicant is not required to charge GST on the OIDAR supplies made to a person in the taxable territory who receives the same for the purpose of commerce, industry or any other business or profession. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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