TMI Blog2019 (10) TMI 943X X X X Extracts X X X X X X X X Extracts X X X X ..... f supply of timber to the Depot by the applicant shall be the open market value or the value as may be determined under rule 30 or rule 31 in that order. Whether the payment of GST on the full amount by the auctioneer i.e. Government Depot, will be the complete discharge of liability in the hands of the applicant and hence the applicant is not required to charge any GST while depositing as well as receiving the net consideration from the auctioneer? - HELD THAT:- There is no provision in the GST Act for shifting of the tax liability and considering that as a deemed discharge of liability. There are two supplies of timber involved in the chain of transactions, one when the timber is handed over to the depot by the applicant and the second when the timber is sold by the depot. Both are independent supplies in the eyes of the GST Act and hence the tax needs to be discharged at both stages. Time of supply of timber - HELD THAT:- The time of supply is the time of removal of timber/ wood by the applicant for supply to the depot. If the transaction is considered as supply in the hands of the applicant when consideration is not fixed / known at the time of supply, when would be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the full amount by the auctioneer i.e. Government Depot, will be the complete discharge of liability in the hands of the applicant and hence the applicant is not required to charge any GST while depositing as well as receiving the net consideration from the auctioneer? d) If the transaction is supply in the hands of the applicant, what is the time of supply of timber? e) If the transaction is considered as supply in the hands of the applicant when consideration is not fixed / known at the time of supply, when would be the time of supply and when the applicant has to remit the tax on what value? This is especially where the Government Timber Depot decides the time of auction and the applicant does not have any control on this process. f) Should GST be paid by the applicant on supervision charges collected by the Government Timber Depot under Reverse Charge as per the SI.No.5 of Notification No. 13/2017? 3. The applicant furnishes some facts relevant to the stated activity: a. The applicant states that he is a part of the Tata Group of Companies and is engaged in the business of Coffee /Tea / Pepper plantation. In the plantation, certain trees are grown for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce 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 provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the KGST Act. 4.1 The transaction of the applicant is examined and found that there are two types of transactions between the applicant and the Karnataka Timber Depots: (a) The sale of timber by the Karnataka Timber Depot on behalf of the applicant (b) provision of service of supervision of timber till the time of sale 4.2 The timber / wood belonging to the applicant is handed over to the Karnataka Timber Depot (referred hereinafter as Depot ) for auction or further supply and the Depot is raising invoice against such supply made to third parties. This action of the Depot is in the capacity of an agent of the applicant with rights to transfer the title of the goods to third parties and hence is clearly transferred the same as an agent of the applicant. Hence the supply made by the agent on behalf of the princ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding the third question, there is no provision in the GST Act for shifting of the tax liability and considering that as a deemed discharge of liability. There are two supplies of timber involved in the chain of transactions, one when the timber is handed over to the depot by the applicant and the second when the timber is sold by the depot. Both are independent supplies in the eyes of the GST Act and hence the tax needs to be discharged at both stages. 6. Regarding the time of supply of the transaction involving handing over of goods to the auctioneer, sub-section (2) of section 12 of the CGST Act, 2017 needs to be referred, which reads as under: (2) The time of supply of goods shall be the earlier of the following dates, namely: (a) the date of issue of invoice by the supplier or the last date on which he is required under section 31, to issue the invoice with respect to the supply; or (b) the date on which the supplier receives the payment with respect to the supply. Further, section 31(1) of the CGST Act, 2017 reads as under: (1) A registered person supplying taxable goods shall, before or at the time of, - (a) removal of goods for supply to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule as follows RULING 1. The transaction of depositing timber with the Government Timber depot for disposal would amount to supply within the meaning assigned to it under the GST Act and GST is chargeable on the value of such supply. 2. The value of supply of timber to the Depot by the applicant shall be the open market value or the value as may be determined under Rule 30 or Rule 31 in that order. 3. There is no provision in the GST Act for shifting of the tax liability and considering that as a deemed discharge of liability. There are two supplies of timber involved in the chain of transactions, one when the timber is handed over to the depot by the applicant and the second when the timber is sold by the depot. Both are independent supplies in the eyes of the GST Act and hence the tax needs to be discharged at both stages. 4. The time of supply is the time of removal of timber/ wood by the applicant for supply to the depot. 5. it is the repeat of the earlier questions and hence not answered again. It is pertinent to note that the time of second supply involving timber i.e. by the depot (agent) to the third party does not have any impact on the value or tim ..... X X X X Extracts X X X X X X X X Extracts X X X X
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