TMI Blog2020 (6) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... the Applicant under On-line database access services wherein the SCN has alleged that the services provided by the Applicant is bundled service of design, prototype, testing in virtual world through computer network and online database access gives the essential characteristic of OIDAR to the said bundled service - In view of the provision to Section 98(2) of the CGST Act, 2017, this authority cannot admit the application in respect of this question because the question raised in the application is already pending before the department under the provisions of this Act as is seen from the SCN issued to the applicant on 27.08.2018. - GST-ARA-25/2019-20/B-19 - - - Dated:- 25-2-2020 - MS. P. VINITHA SEKHAR, AND MR. A. A. CHAHURE, 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 ] by M/s. Lear India Engineering LLP, the applicant, seeking an advance ruling in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch, the Applicant checks whether such design meets the requirement of the customer or not. For this, Applicant uses computer graphic simulation technologies which enables the Applicant to create 3-D graphic simulations that replaces fabricated prototypes. The entire testing is carried out in virtual environment, no prototypes are ever received from the service receiver for testing purposes. Once the design is tested and approved in India, the same is stored on the server of the customer for verification and approval. In case the customer has any suggestions, comments, etc. the design is again modified by the Applicant and above referred process is reiterated. Once the design is finally approved by the customer, the activity of Applicant is concluded. In the subject case there is no import of prototype from the service receiver for testing purposes. This activity was being treated by the applicant as export of service under the Service Tax Laws. 2.5 In the E-Systems Division, applicant develops Electronic Control Units ( ECU ) as per the requirements of its customers. ECU is a composite box which controls various electronic functions of the car such as power window, audio system, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erver within the defined timeline agreed. Once the functional software developed by each Lear entities are uploaded on the Lear server, the said software is integrated together by the. overseas Lear entity which has placed order with other Lear entities. Such integration of all the functional software is important to test their performance and identify the problems if any faced in the interface between such functional software after integration. The integrated software is thereafter uploaded on the Lear server which is downloaded by each location who have developed the functional software. Thereafter, such integrated software is loaded on a hardware i.e. ECU which is supplied by overseas Lear entity, to carry out the testing of respective functional software in the overall integrated software. Further, the purpose of sending the common hardware to all the Lear locations is to provide the uniform platform on which the software is to be uploaded for testing purposes. The applicant neither has the capacity nor undertakes any testing operations on the hardware so supplied by its customer. The whole purpose of sending the hardware to provide uniformity in the platform on which the en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he GST Regime? 3.2 The jurisdictional officer has referred to the provisions of Section 2(6) of the IGST Act and the relevant provisions of Section 13 of the IGST Act. It is submitted that in the given case, the services carried out by Applicant are performance based and the activities performed in the seating division would squarely fall under the provisions of the Section 13(2) of the IGST Act. It is also submitted that the activity carried out in the E- systems division of Applicant is confined to the development of software and is integral part of overall software development undertaken by Applicant. Consequently, the general rule provided under sub-section (2) of Section 13 of the IGST Aet would be applicable and the POS would be the location of the service recipient. If the given case, since the location of recipient of services is outside India, it can be construed that the POS for the services performed by Applicant is outside India. The jurisdictional officer has also submitted contention to state that the present services cannot be said to fall under the category of OIDAR services and even if they are classified as OIDAR services they would qualify as export of service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to classify the services of the Applicant under On-line database access services wherein the SCN has alleged that the services provided by the Applicant is bundled service of design, prototype, testing in virtual world through computer network and online database access gives the essential characteristic of OIDAR to the said bundled service. 5.5 light of the facts mentioned at 5.4 above, we feel that a reference is required to be made to the provisions of Section 98 of the CGST Act, which is reproduced below:- Section 98 of CGST Act 2017: Procedure on Receipt of Application (CHAPTER XVII - ADVANCE RULING) (1) On receipt of an application, the Authority shall cause a copy thereof to be forwarded to the concerned officer and, if necessary, call upon him to furnish the relevant records: Provided that where any records have been called for by the Authority in any case, such records shall, as soon as possible, be returned to the said concerned officer. (2) The Authority may, after examining the application and the records called for and after hearing the applicant or his authorised representative and the concerned officer or his authorised representativ ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
