TMI Blog2020 (7) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... ies. It is found that they are rendering Goods Transport Services to POSCO group of companies directly - the services supplied by them would be covered under Heading 9965 which covers Goods Transport Services , Sub Heading 99651 which covers Land Transport service of Goods and further under SAC 996511. What will be the applicable GST rate on the above service? - HELD THAT:- Having held that the services supplied by the applicant to POSCO group of companies are covered under Heading 996511, we have no hesitation in holding that GST applicable in this case will be covered under Entry 9(iii) of the Notification 11/2017(CT) Rate dated 28 June 2017 subject to conditions mentioned therein i.e. a GST Rate of 5% will be provided that credit of input tax credit charged on goods and services used in supplying the services has not been taken and a GST Rate of 12% will be applicable provided that the goods transport agency opting to pay central tax @ 6% under this entry on all the services of GTA supplied by it. Whether the Applicant would be eligible to avail the input tax credit of the 12% GST charged by the third-party transporters? - HELD THAT:- As far as the services provided by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GST rate on the above services of the Applicant among the following? - 12% (entry 9(iii) of the Notification 11/2017(CT) Rate dated 28 June 2017]; - 12% (entry 11(1) of the Notification 11/2017(CT) Rate (hied 28 June 20171; - 18% (entry 11(ii) of the Notification 11/2017(CT) Rate doted 28 June 2017); - Or any other 3. Whether the Applicant would be eligible to avail the input tax credit of the 12% GST charged by the third-party transporter? 4. Whether the transporter would be right in charging GST @12% under forward charge mechanism to Applicant in terms of Notification No 20/2617-Central Tax (Rate) dated 22 August 2017 when Applicant as the main contractor, is already charging GST@ 12% under the same Notification, which is going to remain unchanged? 5. Procedurally, is it correct to have two GTA Service Providers and two consignment notes for the same movement of goods, one issued by the Applicant as main contractor and the other by transporters sub-contractor? At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 019, only to consider this final submission for the purpose of advance ruling. Vide this application they have redrafted their questions which are mentioned above. 2.6 The transport services provided by applicant includes undertaking dispatch of consignments for POSCO group companies viz. Between Customs Port and the place of business of POSCO group companies for import and export consignments; and From POSCO group companies to its customer in India. 2.7 In the instant case, Applicant has entered into a back-to back arrangement with the logistics provider, Royal Translines Pvt. Ltd. (Transport Vender/Transport Agency), under which the steel coils are transported by the Transport Vendor/Transport Agency from Port of Import to POSCO-MAH s factory in Mangaon, Raigad or from POSCO-MAHS factory in Mangaon, Raigad to its customers in India. Consignment notes are always issued by the applicant in respect of such transportation. POSCO-MAH and POSCO-MAH customers, acknowledge the completion of the transportation services by stamping and signing the consignment note issued by the applicant on delivery of the goods in the designated premises. The Transport Vendors/ Transport Agencies ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2017 - C.T. (Rate) dated 28.06.2017, as amended. Entry no. 9 of the said Notification prescribes the rate for Goods Transport Services . Sub-entry (iii) therein was substituted vide Notification No. 20/2017-C.T. (Rate) dated 22.08.2017 with effect from 22.08.2017 and reads as under: Sr.No. Chapter, Section or heading Description of Services Rate (per cent) Condition 9 Heading 9965 (Goods Transport Services) (iii) Services of goods transport agency ( GTA ) in relation to transportation of goods (including used household goods for personal use). Expln : goods transport agency means any person who provides services in relation to transportation of goods by road and issues consignment note, by whatever name called. 2.5 Provided that credit of input tax credit charged on goods and services used in supplying the services has not been taken (Please refer explanation no. (iv)] Or 6 Provided that the goods transport agenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax credit as it is charging GST @ 12% on its outward supply of GTA services. 2.14 Alternatively, the Applicant is of the view that in case, the consignment note is issued by the Applicant, however, actual transportation is carried out by the third party transporter appointed by the Applicant, then its services would be classified under service code 995791. The relevant codes are reproduced below for ready reference. Heading No: 9967 Supporting services in transport Group 99679 Other supporting transport services 99679 Goods transport agency services for road transport 996792 Goods transport agency services for other modes of transport 996793 Other goods transport services 996799 Other supporting transport services n.e.c 2.15 In such a case, supply of services by the Applicant would be covered under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the input services of the third-party transporters who would be charging GST @ 12%. 03. CONTENTION - AS PER THE JURISDICTIONAL OFFICER The jurisdictional office has made submissions as under:- 3.1 If applicant is not qualified as GTA or courier agency, then he can qualify as transport operator and the exemption is available U/S 11 of GST 2017. 3.2 The definition of GTA IS GTA means any person who provides service in relation to transport of goods by road and issues consignment note by whatever name called. (Notification no. 11/2017 -CT(R) entry no.9 explanation). In this case the applicant issues consignment notes hence qualify as. GTA. 3.3 As the Transport Vendor/Agency provides services by way of giving on hire to a goods transport agency (GTA), i.e., in this case the applicant; a means of transportation of goods, he is regarded as exempt within the meaning of provisions entry no.22 of Notification No. 12/2017 CT (R) dt. 28/06/2017 (Heading 9966). 3.4 The services of the second applicant is regarded under Entry No. 22 of Notification No. 12/2017 CT(R) dt.28/062017 (Heading 9966) and therefore will not be covered under Entry no.11 of Notification No. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GST Act. They were provided 8 days time to submit their written contention. Jurisdictional Officer Ms. Sangita P. Satpute State Tax Officer (C-123) Pune, appeared. Further hearing fixed on 06.05.2019 was adjourned to 22.05.2019. Ch. Hong Ik Cko, Managing Director Sh. Machindra R. Mulik, Service Tax Practitioner appeared and as per request of applicant, were allowed 15 days time to reframe the questions and facts in clear terms. The hearing was rescheduled on 19.09.2019 but applicant requested for another adjournment. Jurisdictional Officer Ms. Sangita P. Satpute State Tax Officer (C-123) Pune along with Assistant Commissioner of State Tax. (D-501) Pune, appeared made written submissions. The applicant further amended its submission and the application for advance ruling was finally accepted. The case was finally heard on 14.11.2019. Sh. Machindra R. Mulik, Service Tax Practitioner appeared and made oral submissions. The applicant also requested this Authority to only consider their submissions dated 14.11.2019. Jurisdictional officer was also present. Heard both the sides. 05. DISCUSSIONS AND FINDINGS 5.1 We have gone through the facts of the case, documents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of goods by road is exempt from GST unless it is a service rendered by a GTA. Even though GTA is not defined under the GST Act, mention of GTA is made in Notification No. 12/2017. As per 2 (ze) of the said Notification, Goods transport agency means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever named called . In the subject case, since the applicant is providing, to POSCO group of companies, services in relation to transport of goods by road, and are also issuing consignment notes for such transactions, thus, in our opinion applicant can be considered as Goods Transport Agency (GTA). Service Code 9965 pertains to Goods Transport Service . Service Code 99651 pertains to Land transport services of Goods . Service Code Heading 996511 pertains to Road transport services of Goods including letters, parcels, live animals, household office furniture, containers etc. by refrigerator vehicles, trucks, trailers, man or animal drawn vehicles or any other vehicles As per the Explanatory Notes to the scheme of Classification of Services, the service code Heading 996511 includes: - i. transportat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rangement services on behalf of the consignor or consignee); freight consolidation and break-bulk services. Service code Heading 996799 incudes; type rating services (aircraft-specific permits for flying a particular type or plane); liquefaction and regasification of natural gas for transportation; radio navigational aid locating such as GPS (global positioning system) provision. From the submissions made by the applicant we find that applicant is a GTA providing Goods Transport Agency Services and the services provided by them are transport of goods by road. In the subject case, they have a contract/agreement with POSCO group companies to provide transportation services wherein they undertake dispatch of consignments by road for POSCO group companies. We find that they are rendering Goods Transport Services to POSCO group of companies directly. In View of the discussions made above, in our opinion the services supplied by them would be covered under Heading 9965 which covers Goods Transport Services , Sub Heading 99651 which covers Land Transport service of Goods and further under SAC 996511. Question No. 2. What will be the applicable GST rate on the above ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hanged? The question raised does not pertain to supply undertaken or to be undertaken by the applicant and therefore in view of the provisions of Section 95 of the CGST Act, 2019, this authority cannot answer the question. 5. Procedurally, is it correct to have two GTA Service Providers and two consignment notes for the same movement of goods, one issued by the Applicant as main contractor and the other by transporters sub-contractor? The question raised here pertains to procedure to be followed. The question does not fall under Section 97 (a) to (g) of Section 95 of the CGST Act, 2019, and therefore this authority refrains from answering the said question. 06. In view of the above discussions, 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-134/2018-19/B-23 Mumbai, dt. 05.03.2020 For reasons as discussed in the body of the order, the questions are answered thus - Q. No. 1: - What will be the classification of the services (whether under service codes 996511 or 996791 or 996799 or any other) of the Applicant in case t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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