TMI Blog2020 (10) TMI 854X X X X Extracts X X X X X X X X Extracts X X X X ..... ds without any changes. The ROM rejection order does not merge with the original advance ruling order. The original advance ruling stands without any corrections. The appeal should have been filed by the Appellant against the advance ruling order dated 21-09-2019 within the period of 30 days from the date of communication of the said order. In the instant appeal, the Appellant is aggrieved by the entire ruling pronounced by the lower Authority - This Appellate Authority being a creature of the statue is empowered to condone a delay of only a period of 30 days after the expiry of the initial time period for filing appeal. We are not empowered to condone any delay beyond what the statute permits us. Appeal against ROM is not maintainable in as much as the impugned order is not an appealable order under Section 100 of the CGST Act, 2017 - the ROM rejection order dated 23-03-2020 does not merge with the original advance ruling dated 21-09-2019. - KAR/AAAR/03/2020-21 - - - Dated:- 21-9-2020 - SHRI. D.P.NAGENDRA KUMAR, AND SHRI. M.S.SRIKAR, MEMBER Represented by: Mr. Anantnarayan S Mr. K. Sivaranjan, Authorised representatives PROCEEDINGS (Under Section 101 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upply of like goods involving transfer of title in goods? (ii) Whether statutory contributions made to District Mineral Foundation (DMF) and National Mineral Exploration Trust (NMET) as per MMDR Act, 1957 amounts to Supply and whether the same is liable for GST under reverse charge. 5. The AAR vide its order KAR ADRG No 69/2019 dated 21st Sept 2019 = 2019 (10) TMI 865 - AUTHORITY FOR ADVANCE RULING, KARNATAKA gave the following ruling: i. The royalty paid in respect of Mining Lease is a part of the consideration payable for the Licensing services for right to use minerals including exploration and evaluation falling under the Head 9973 which is taxable at the rate applicable on supply of like goods involving transfer of title in goods upto 31.12.2018 and taxable at 9% CGST and 9% SGST from 01.01.2019 onwards under the residual entries of Serial No. 17 of the Notification No.11/2017- Central Tax dated 28.06.2017. ii. The statutory contribution made to District Mineral Foundation (DMF) and National Mineral Exploration Trust (NMET) as per MMDR Act, 1957 are also part of the consideration payable for the Licensing services for right to use minerals including ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in the case of Titaghur Paper Mills Company vs State of Orissa ors = 1983 (4) TMI 49 - SUPREME COURT which was followed by the AP High Court in the case of Andhra Pradesh Paper Mills = 1988 (2) TMI 453 - ANDHRA PRADESH HIGH COURT and in the case of ITC Bhadrachalam Paper Boards = 2014 (12) TMI 998 - ANDHRA PRADESH HIGH COURT Division wherein it was held that such profit is in the nature of profit a pendre and cannot be viewed as 'sale' and is not subject to VAT. Accordingly, royalty paid by them is not a supply as it is a statutory obligation and not a service rendered by the Central or State Govt. 8.2. Without prejudice to the above, they submitted that royalty paid in respect of mining lease will be classifiable under SAC 997337 and will continue to be taxed at 5% even after the amendment to Notf No 11/2017 CT (R) vide Notf No 27/2018 CT (R) dt 31-12-2018. They submitted that Heading 9973 covers various types of leasing, rental, licencing services. However, the group under heading 9973 in the rate Notf largely covers right to use intangible property. They submitted that the entries prescribing the rate of tax for the service code 9973 does not speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellants were called for another virtual hearing on 21st September 2020. 9.1. The hearing on 21stSeptember 2020 was conducted on the Webex platform following the guidelines issued by the CBIC vide Instruction F.No 390/Misc/3/2019-JC dated 21st August 2020. The Appellant was represented by their authorised representatives Mr Anantnarayan S Mr K Sivaranjan, Chartered Accountants who gave a brief about the facts of the case and reiterated the submissions made in the grounds of appeal. They also filed detailed written submission at the time of the personal hearing. They submitted that payment of royalty is not a supply under GST and is not liable to tax; that grant of mining lease and its execution by the Govt is a statutory act and not a supply of service. The payment of royalty by a lessee is also a statutory obligation and is to be paid in proportion to the mineral excavated for sale, use or consumption. Therefore, the transaction cannot be regarded as supply. 9.2. They further submitted that, even if royalty is taxable, it will be covered under service code 997337 and will continue to be taxed at 5% GST even after 01-01-2019 and not at 18% as held by the lower Authority. H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds of appeal as well as the detailed submissions made at the time of personal hearing. 11. We first address the issue of admissibility of this appeal under Section 100 of the CGST Act. In terms of the said Section an appeal to the Appellate Authority for Advance Ruling may be made by either the applicant, the concerned officer or the jurisdictional officer who is aggrieved by the advance ruling pronounced under Section 98(4) of the said Act. The said Section 98(4) relates to the advance ruling pronounced by the Authority on the questions specified in the application. 12. As per Section 95(a) of the CGST Act, advance ruling means a decision provided by the Authority or the Appellate Authority to an applicant on matters or questions specified in sub-section (2) of section 97 or sub-section (1) of section 100,in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant. The procedure for obtaining an advance ruling is outlined in Section 98 of the said Act which is reproduced below for reference: 98. Procedure on receipt of application.- (1 ) On receipt of an application, the Authority shall cause a copy thereof t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date on which the ruling sought to be appealed against is communicated to the aggrieved person. However, the Appellate Authority may, if it is satisfied that the appellant was prevented by a sufficient cause from presenting the appeal within the said period of thirty days, allow it to be presented within a further period not exceeding thirty days. In terms of Section 101, the Appellate Authority may pass such order as it thinks fit, confirming or modifying the ruling appealed against. Further, Section 102 of the CGST Act, provides for rectification of advance ruling whereby the Authority or the Appellate Authority may amend any order passed by it under section 98 or section 101, so as to rectify any error apparent on the face of the record, if such error is noticed by the Authority or the Appellate Authority on its own accord, or is brought to its notice by the concerned officer, the jurisdictional officer, the applicant or the appellant within a period of six months from the date of the order. 14. Now let us set out the facts in this case leading to the instant appeal before us. The Appellant filed an application for advance ruling on 27-08-2028 before the Authority in terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9;ble High Court of Karnataka in the case of Kothari Industrial Corporation vs Agricultural Income Tax Officer = 1995 (9) TMI 5 - KARNATAKA HIGH COURT . The relevant para of the High Court order is reproduced below: 11. The next question is where the authority who passed the order, has occasion to reconsider the matter and passed a subsequent order, whether there is any merger, and if so to what extent. There are two circumstances where an authority has occasion to reconsider his own order : (a) by way of review; and (b) by way of rectification. Normally, review is contemplated where new and important matter or evidence comes to light or where there is a mistake or error apparent on the face of the record. Rectification is resorted to, to correct clerical or arithmetical errors. When the authority grants an application for review of an order, the order in regard to which review is granted stands vacated or set aside and the order subsequently passed on review (either modifying, reversing or confirming the earlier order) will supersede the original order. In such a case, there is no question of merger, as the second order supersedes the first order and only the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ument that we consider this appeal as an appeal against the advance ruling dated 21-09-2019, even then we observe that the statutory time limit for filing an appeal against the advance ruling order has long expired. This Appellate Authority being a creature of the statue is empowered to condone a delay of only a period of 30 days after the expiry of the initial time period for filing appeal. We are not empowered to condone any delay beyond what the statute permits us. 19. In view of the aforesaid, we hold that the appeal filed against the ROM order KAR ROM 01/2020 dated 23-03-2020 is not maintainable in as much as the impugned order is not an appealable order under Section 100 of the CGST Act, 2017. We also hold that the ROM rejection order dated 23-03-2020 does not merge with the original advance ruling dated 21-09-2019. Since the appeal is not maintainable, the question of addressing the issues raised in appeal does not arise. 20. In view of the above discussion, we pass the following order ORDER We dismiss the appeal filed by M/s NMDC Ltd, Admin Building, Donimalai Township, Donimalai, Sandur, Ballari District 583118 on The ground that it is not maintainable. - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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