TMI Blog2020 (11) TMI 1050X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to file the application for Advance Ruling in respect of the questions specified under Section 97(2) of the CGST Act, 2017. Section 9 of the CGST Act, 2017 is the section dealing with 'levy and collection'. It provides for the levy of CGST on all intra-state supplies of goods or services or both. Section 9(3) of the CGST Act, 2017 in keeping with the tenor of the Section also speaks about the 'liability to pay tax' - all the provisions of the CGST Act, 2017, including the provisions related to the Advance Ruling, as laid down under Chapter XVII of the CGST Act, 2017, will be applicable to such recipients. Also, Section 31 (3)(f) of the CGST Act, which deals with 'Tax Invoice', requires a registered person, who is liable to pay tax under section 9(3) to issue a tax invoice in respect of goods or services received by him. As per Rule 36 (1)(b), the recipient is also eligible to take input tax credit on the basis of the tax invoice. This makes it clear that the recipient deemed to be liable to pay tax, he is well, within his rights to make an application for Advance Ruling to know whether he is liable to pay tax . Liability to pay tax on the recei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Order No. MAH/AAAR/RK-SK/27/2020-21 Date, 03.11.2020 (Proceedings under Section 101 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017) 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 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 MGST Act. 2. The present appeal has been filed under Section 100 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. Portescap India Private Limited ( the Appellant ) against the Advance Ruling No. GST-ARA-93/2019-20/B-31, dated 12.03.2020 ., pronounced by the Maharashtra Authority, for Advance Ruling (hereinafter referred to as MAAR) BRIEF FACTS OF THE CASE 3.1 M/s. Portescap India Pvt. Ltd., having GSTIN 27AAACK4896K1ZZ, is engaged in the activity of manufacturing of customized motors in India. The Appellant is an SEZ Unit and engaged in expo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to a developer or unit to carry out the authorized operations in a SEZ. The grant of exemption will be subject to the terms and conditions as prescribed by the Central Government in terms of sub-section (2) of Section 26 of the SEZ Act, 2005. 3.7 As per Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017, the Central Government has exempted Services provided by Central Government, State Government, Union territory or a local authority, where the consideration for such services does not exceed five thousand rupees subject to the proviso mentioned therein. Additionally, in accordance with the Notification No. 13/2017-Central Tax (Rate), dated 28.06.2017 read with Notification No. 3/2018-Central Tax (Rate), dated 25.01.2018, Services supplied by Central Government. State Government. Union territory or local authority to a business entity, the recipient of service is required to pay tax on reverse charge mechanism. 3.8 In light of the above facts, the Appellant filed an application before the Maharashtra Advance Ruling Authority (MAAR) to obtain a ruling with regard to the questions, mentioned below: (i) Whether Appellant is required to pay tax under reverse charge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9(3) of the CGST Act, 2017, related to Reverse Charge Mechanism (RCM), is reproduced below: - The Government may, on the recommendations of the Council, by Notification specify categories of supply of goods or services or both. the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and al the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both. 5.3 That Section 16 of the IGST Act, 2017 pertains to zero-rated supplies, the relevant portion of which is being reproduced below: - 16. (1) zero rated supply means any of the following supplies of goods or services or both, namely: - (a) export of goods or services or both; or (b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit. 5.4 That the Sectoral FAQ's on Exports issued by the CB!C gives the following clarifications regarding goods or services or both supplied to the SEZ units/developers:- 6. When a SEZ unit or SEZ developer procures any goods or services from an unregistered sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e requirements of Notification No. 13/2017-Central Tax (Rate), dated 28.06.2017 read with Notification No. 03/2018 - Central Tax (Rate), dated 25.01.2018, for any or all services mentioned therein. 5.10 That one of the questions on which Advance Ruling can be obtained as per Section 97(2) is admissibility of input tax credit of tax paid or deemed to have been paid . Accordingly, it can be inferred that the Advance Ruling can also be filed by the Appellant wherein the Appellant is in receipt of goods or services or both. 5.1 1 The Appellant have placed reliance on the following Advance Rulings issued by Advance Ruling Authorities of Andhra Pradesh, Karnataka and by Appellate Advance Ruling Authorities of Odisha, wherein the question was as to whether the Applicant / Appellant in that case was liable to pay tax under reverse charge mechanism. SI. No. Authority and State Advance Ruling No. Appellant's Name 1. Andhra Pradesh AAR AAR No. 29/AP/GST/2019, dated 16-07-2019 PKR Projects and Engineers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are not eligible to file the Advance Ruling on this very issue. i.e. determination of liability to pay tax under RCM, on the supply of impugned services, in terms of the provision of Section 95(a) of the CGST Act, 2017. 6.3 As regards the contention, put forth by the Appellant, wherein they have referred to Section 9(3) of the CGST Act, 2017 to emphasize that for supplies made under reverse charge mechanism, recipient becomes the supplier of goods/services for determination of liability, thereby inferring that the impugned transaction can be regarded as the supply of services undertaken by the Appellant, the Respondent has submitted that it is nowhere mentioned in the aforesaid Section 9(3) of the CGST Act, 2017 that the person, i.e. the recipient of the supply will become the supplier or the transaction will become the supply undertaken by the person, who happens to be the recipient in such cases. The Respondent has further submitted that the person, who is deemed to be the supplier of goods or services or both for the payment of tax under RCM will remain the recipient of goods or services or both and the said supply will still be maintained as the supply undertaken by the ori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices or both are not eligible to seek the Advance Ruling in terms of the provision of Section 95(a) of the CGST Act, 2017. In this regard, reliance has been placed on Advance Ruling passed by the Tamil Nadu AAAR in the case of M/s. Naga Limited. As regards the two case laws cited by the Appellant, viz. (i) Odisha AAAR order in the case of Penguin Trading and Agencies Limited and (ii) Hon'ble Kerala High Court Judgment, dated 03.02.2020 in the case of Sutherland Mortgage Services Inc. Vs. Principal Commissioner of Customs, Central GST and Central Excise, Kochi, it has been submitted that the facts of the aforesaid cases, relied upon the Appellant, are clearly different from the facts the present case, and therefore, are clearly distinguishable. DISCUSSIONS AND FINDINGS 8. We have carefully gone through the appeal memorandum encapsulating the facts of the case and the grounds of the appeal along with other relevant documents. We have also examined the impugned ruling passed by the Maharashtra Advance Ruling Authority, wherein it has been held that the Advance Ruling application filed by the Appellant for obtaining Advance Ruling in respect of the issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant provisions related to the Advance Ruling, as provided under Section 95(a) of the CGST Act, 2017, which provides the meaning of the term Advance Ruling- as envisaged under the CGST Act, 2017. The same is being reproduced hereinunder: Section 95(a) advance ruling means a decision provided by the Authority or the Appellant Authority to an applicant on matters or on 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. 11. On plain reading of the texts of the aforesaid provisions, it is amply clear that the Advance Ruling can be sought only in respect of such supplies, which have been undertaken or proposed to be undertaken by the applicant. In other words, it can be said that only supplier- of goods or services or both, can seek the Advance Ruling and not the recipient- of such supplies. Thus, we agree with the observations made by the Maharashtra Advance Ruling Authority to the extent that it is only the supplier of goods or services or both, who is eligible to file the application for Advance Ruling in respect o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rights to make an application for Advance Ruling to know whether he is liable to pay tax . 14. The Appellant have raised the issues as to whether they are liable to pay tax on the receipt of renting of immovable property services from the SEEPZ SEZ Authority as well as on the other services procured by them wherein they are liable to pay tax under RCM, in terms of the provisions of the Notification No. 13/2017-C.T. (Rate), dated 28.06.2017, as amended by Notification No. 03/2018-C.T. (Rate), dated 25.01.2018. In this regard, we observe that the said questions, asked by the Appellant, can aptly be construed to be covered under the clause (e) of Section 97(2) of the CGST Act, 2017, which provides for the determination of the liability to pay tax on any goods or services or both. The aforesaid observation also finds support from the Kerala High Court Judgment in the case of Sutherland Mortgage Services Inc. vs. Principal Commissioner of Customs, Central GST and Central Excise, Kochi [2020 (3) TMI 186-Kerala High Court], wherein the High Court during the course of the judicial review of the Advance Ruling pronounced by the Kerala Advance Ruling Authority inter-alia observed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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