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TMI Blog2022 (6) TMI 419X X X X Extracts X X X X X X X X Extracts X X X X ..... ST Act, 2017 read with Rule 104 of CGST/TGST Rules. 2. At the outset, it is made clear that the provisions of both the CGST Act and the TGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the TGST Act. Further, for the purposes of this Advance Ruling, the expression 'GST Act' would be a common reference to both CGST Act and TGST Act. 3. It is observed that the queries raised by the applicant fall within the ambit of Section 97 of the GST ACT. The Applicant enclosed copies of challans as proof of payment of Rs. 5,000/- for SGST and Rs. 5,000/- for CGST towards the fee for Advanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prospective period from the date of modified application, i.e., 01.01.2019 only. 2. That, a percentage of royalty earned by them is paid to District Mineral Foundation and National Mineral Exploration Trust as compulsory Contribution prescribed under MMDR Act' 1957. That, in their view no tax is payable on such contribution on reverse charge by them. 3. That, they have reached this conclusion on point no.2 above for the following reasoning: a) That, reverse charge is payable on the consideration paid to State/Central Government or Local bodies only. b) That, these two organizations are neither government nor local bodies but classified as governmental authorities under Notification No.32/2017. 7. Discussion & Findings: The applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of immovable property. As noted in Titagarh Paper Mill's case (1985) 3 SCR 26, the right conferred by the lease deed to extract and remove the minerals is a 'profit a prendre'. The Hon'ble Supreme Court of India in this case cited certain paras in Halsbury's Laws of England (Fourth Edition) 2003 for elucidating the meaning and content of a mining lease. The same is reproduced as under: "Para 321: Nature of mining lease : A lease may be granted of land or any part of land, and since minerals are a part of the land it follows that a lease can be granted of the surface of the land and the minerals below, or of the surface alone, or of the minerals alone. It has been said that a contract for the working and getting of minerals, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ara 323: Rents and royalties- An agreement for a lease usually contains stipulation as to the dead rents and other rents and royalties to be, reserved by, and the covenants and provisions to be inserted in the lease, but the omission to provide for the payment of a dead rent does not render the agreement so inequitable as to be unenforceable. Rent and royalties are true rents in the sense that they are incident to the reversion, but periodical payments under a lease of mines for a specific period may amount to personal debts only. A lessee who goes into possession and works minerals before completion of the lease may be ordered on interim application to pay into Court the amount of royalties due in respect of minerals raised. Para 324: Us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nough return income, whether the mine is worked properly so as not to yield enough return to the lessor in the shape of royalty. In order to ensure for the lessor a regular income, whether the mine is worked or not, a fixed amount is provided to be paid to him by the lessee. This is called "dead rent". "Dead rent" is calculated on the basis of the area leased while royalty is calculated on the quantity of minerals extracted or removed. Thus, while dead rent is a fixed return to the lessor, royalty is a return which varies with the quantity of minerals extracted or removed. Since dead rent and royalty are both a return to the lessor in respect of the area leased, looked at from one point of view dead rent can be described as the minimum guar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or Notifications issued do not create a legal fiction for mining to be classified as 'Leasing or Renting of goods'. At Serial no. 17 of the Notification No. 11/2017 chapter heading no. '9973' of SAC enumerates 'leasing or rental services without an operator'. This entry was modified by removing 'with' operator vide Notification No. 27/2018 dated: 31.12.2018. According to explanation to this notification any reference to chapter, section or heading shall be with respect to scheme of classification of services annexed to the notification. In this annexure, the service leasing or renting of goods is enumerated under group head '99732'. As against the above entry in the annexure to Notification No. 11/2017 the group head '99733' enumerates le ..... X X X X Extracts X X X X X X X X Extracts X X X X
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