TMI Blog2022 (3) TMI 572X X X X Extracts X X X X X X X X Extracts X X X X ..... Motor Vehicles fall under Heading 8703 of the GST Tariff. All the items under 8703 will attract 28% GST except Tariff item 870310 10; Sub-heading 8703 80. However old cars will attract a lower rate of tax as per Notification No. 08/2018 CT (Rate) dated 25.01.2018. As per the said Notification, the lesser rate of tax i.e. 18 % is applicable to old cars provided the conditions mentioned therein are fulfilled. Old Jewellery - HELD THAT:- Articles of jewellery and parts thereof, of precious metal will fall under Heading 7113 of the GST Tariff attracting 3% GST. Antique jewellery - HELD THAT:- Antique jewellery of age exceeding 100 years:- Antique jewellery of age exceeding 100 years will fall under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. Old Watches - HELD THAT:- Wrist watches, pocket-watches and other watches, including stopwatches, with case of precious metal or of metal clad with precious metal will fall under CH 9101 of the GST Tariff and Wrist watches, pocket-watches and other watches, including stop-watches, other than those of Heading 9101 will fall under Heading 9102 of the said Tariff. The rate of GST is 18% and the same will be applicable e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SN-7113 Tax Rate- 3% on value 3% on difference between sale price and purchase price considering Jewellery as second hand goods as provided under Rule 32(5) of CGST Rules Antique Jewellery of an age exceeding one hundred years HSN-9706 Tax Rate- 12% on value 12% on difference between sale price and purchase price considering Jewellery as second hand goods as provided under Rule 32(5) of CGST Rules Watches : Old Watches HSN- 9101/9102 Tax Rate- 18% on value 12% on difference between sale price and purchase price considering watches as second hand goods as provided under Rule 32(5) of CGST Rules Antique Watches of an age exceeding one hundred years HSN-9706 Tax Rate- 12% on value 12% on difference between sale price and purchase price considering watches as second hand goods as provided under Rule 32(5) of CGST Rules Books : Antique Books HSN-9706 Tax Rate- 12% on value 12% on dif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will upload the details of goods for online auction. (iii) Goods will remain in Applicant's possession during the agreed period of approval. (iv) Applicant will have a right to retain or return the goods during the approval period. After conveying the approval and confirming purchase of goods, Applicant will sell the goods to buyer (highest bidder) in auction and will issue the sale invoice to the buyer. (v) The ownership of auctioned goods will be transferred from applicant to buyer the sale invoice is issued to buyer by the Applicant. 2.3 Applicant will continue to deal in the goods in which erstwhile business entity was dealing: namely:- Paintings procured from individual art collectors, artists or other art dealers, Old jewellery, cars, watches, etc. including vintage cars, Memorabilia/Collectibles such as clothing, sport equipment, spectacles, accessories, autographs of celebrities and renowned personalities and Antique consisting mainly of antique books, jewellery, watches and other articles. 2.4 Appellant will predominantly be dealing in personal effects (second hand or used goods) which are procured or bought from users ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng most specific description shall be preferred to heading providing a more general description. 2.8 The term Antique is defined under section 2 (1)(a) of Antiquities and Art Treasures Act,1972 as any article, object or thing which has been existence for not less than one hundred years. Since there is a specific entry for Antiques of an age exceeding one hundred years in the rate schedule prescribed by Notification 1/2017- C.T.(R), the same should prevail over general entries prescribing HSN code and rates for jewellery, watches, books and other items sold as antiques. 2.9 Applicant, relies on ruling pronounced by MAAR and MAAAR respectively in case of erstwhile business entity wherein the authorities have concurred to above referred classification of goods and applicable tax rates in respect of goods dealt with by Astaguru.com. B. Submissions with respect to valuation of goods: 2.10 Section 15 of CGST Act prescribes for value of taxable supply. Rule 32(5) of CGST Rules provides that where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e. used goods as such or after such minor processing which does not change the na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s State of Maharashtra (AIR 2001 SC 1980) Swedish Match AB v/s Securities and Exchange Board of India (AIR 2004 SC 4219) Govt of Andhra Pradesh V/s Road Rollers Owners Welfare Association (2004 (6) SCC 210] 2.14 The intention of Rule 32(5) is to ensure that a dealer buying second hand or used goods from unregistered persons or non-business entities and selling the same, is not saddled with tax liability disproportionate to value addition done by him in transaction chain. In most cases, margin of such second hand goods dealer is less than the tax leviable on such goods under normal scheme of taxation and hence there is need for such provision. 2.15 Once the goods are second hand or used goods, Rule 32(5) is applicable irrespective of value of such goods and irrespective of nature of such goods. There is no stipulation in the Rule that the goods whose value increases with passage of time is not 'used or second hand goods'. It is a settled jurisprudence that tax authorities cannot read any word or phrase into the legal provisions. 2.16 Applicant, relies on ruling pronounced by MAAR and MAAAR respectively in case of erstwhile business entity wherein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity may not be applicable / binding on it as both the entities are two different legal entities having separate GST registrations. Hence, applicant approached Honorable Advance Ruling Authority seeking ruling on the same queries (except few on which AAR as well as MMAR did not answer) decided by the Honorable AAR and AAAR in case of erstwhile business entity. Considering Ruling by AAR and AAAR as mentioned above classification, valuation and GST rates applicable to following goods dealt with by Applicant may be decided as under: Particulars HSN Code Tax Rate Valuation as upheld by AAAR for erstwhile business entity Paintings: Bought from individual art collectors HSN-9701 Tax Rate- 12% on value 12% on difference between sale price and purchase price considering painting as second hand goods as provided under Rule 32(5) of CGST Rules Cars Old Cars HSN-8703 Tax Rate- 18% on value 18% on difference between sale price and purchase price considering car as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... FINDINGS: 5.1 We have gone through the facts of the case, documents on record, and submissions, both oral and written made by the applicant. The jurisdictional officer has not made any submissions. 5.2 The Applicant, M/s Astaguru Auction House Private Limited is entering into a Business Transfer Agreement with M/s Safset Agencies Private Limited (hereinafter referred to as 'SAPL) for taking over the division (viz. Astaguru.com) of SAPL as a going concern. SAPL (Astaguru.com) was dealing in goods such as paintings, vintage collectibles, sculptures, classic miniatures paintings, fine writing instruments, vintage timepieces, celebrity memorabilia, aristocratic jewellery and vintage cars. Since the entire division i.e. Astaguru.com will be transferred to the applicant on 'as is where is1 basis, the Applicant will continue to carry on the same business of SAPL (Astaguru.com). 5.3 Vide the subject application, the applicant seeks a ruling in respect of determination of classification, valuation and GST rates applicable to the following goods:- (a) Paintings (Bought from individual collectors). (b) Old Cars. (c) Jewellery (Old jewellery and Antique Jewelle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vi) Antique watches of age exceeding 100 years:- Antique watches of age exceeding 100 years will fall under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. The provisions of Rule 32(5) of CGST Rules will not be applicable to applicant in this case. (vii) Antique Books :- If the antique books are under 100 years of age then they will be classified under the appropriate Heading of the GST Tariff. Antique books of less than 100 years of age, if it is in the form of printed books, newspapers, pictures, etc, will fall under the various sub headings of Chapter 49 of the GST Tariff as the case may be. Antique books exceeding 100 years of age will be covered under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. 5.4.2 Being aggrieved by the order passed by this Authority as mentioned in para 5.4.1 above, SAPL (Astaguru.com) filed an appeal before the Maharashtra Appellate Authority for Advance Ruling as under:- (i) Paintings: The applicant agreed with classification under Heading 9701 and the rate of GST as 12% as given by this Authority but challenged the decision which disallowed to them the benefit of Rule 32(5) of the CGST Rules, 2017 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from individual art collectors will be classifiable under Heading 9701 and the applicant is liable to pay GST of 12% . (ii) Old Cars:- Motor Vehicles fall under Heading 8703 of the GST Tariff. All the items under 8703 will attract 28% GST except Tariff item 870310 10; Sub-heading 8703 80. However old cars will attract a lower rate of tax as per Notification No. 08/2018 CT (Rate) dated 25.01.2018. As per the said Notification, the lesser rate of tax i.e. 18 % is applicable to old cars provided the conditions mentioned therein are fulfilled. (iii) Old Jewellery:- Articles of jewellery and parts thereof, of precious metal will fall under Heading 7113 of the GST Tariff attracting 3% GST. (iv) Antique jewellery of age exceeding 100 years:- Antique jewellery of age exceeding 100 years will fall under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. (v) Old watches:- Wrist watches, pocket-watches and other watches, including stopwatches, with case of precious metal or of metal clad with precious metal will fall under CH 9101 of the GST Tariff and Wrist watches, pocket-watches and other watches, including stop-watches, other than those of Heading 9101 will fa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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