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TMI Blog2022 (7) TMI 1166X X X X Extracts X X X X X X X X Extracts X X X X ..... . 08/DAAR/2018 dated 28.06.2019. The date of communication of Advance Ruling to the Appellant was 28.06.2019 Brief facts of the case: 3. The Indian Institute of Corporate Affairs (in short, `IICA'), the Appellant is a society registered under the Societies Registration Act, 1860. The Appellant has the following registrations and exemptions available:- (i) An exemption under Section 10(23C) (iv) and (v) of the Income Tax Act, 1961 for AY 2017-18 onwards. (ii) Registration under Section 12A/12AA of the Income Tax Act, 1961 vide registration no. 12A/2009-10/I-1290/593 dated 19.08.2009. The Appellant is primarily engaged in:- (i) Induction and in-service training to Indian Corporate Law Service (ICLS) officers; (ii) Capacity building and training programs in the field of competition law, market regulations, finance, corporate governance and public policies; (iii) Policy advisory functions, public outreach and stakeholder consultations through seminars, conferences and forums. 3.1 The Appellant has the following network of schools and centres through which it executes the above stated functions:- (i) Indian Corporate Law Services Academy (ii) School of Competition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etails are enumerated below:- (a) The IICA had entered into MoU with AICL on 03.08.2016 and conducted a comprehensive baseline and need assessment survey with regard to 50 villages in 5 states mentioned above and as a result, IICA submitted a detailed project report (DPR) to the AICL for the following broad activities to be executed towards discharge of its Corporate Social Responsibility (CSR) for the financial year 2016-17 through IICA, as:- (i) Installation, transportation, maintenance and upkeep of Solar street lights. (ii) Installation, transportation, maintenance and upkeep of Solar Water pumps. (iii) Construction of household toilets as per government's Swachh Bharat Gramin design, with comprehensive awareness building and training of community for use and maintenance of toilets. (iv) Healthcare encompassing doctor's consultancy and basic medicine supplies for 1 year. (b) Consequently, AICL gave its consent for implementation as per the following details from the detailed project report:- (i) Installation of solar water pumps - 122 in Nos; (ii) Installation of solar lights - 1230 in Nos; (iii) Sanitation (construction of toilets) - 3670 in Nos. SUB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Commissioner of Service Tax, Hyderabad [2012] 26 taxmann.com 213 (SC) it was held by the Hon'ble Apex Court that if grants-in-aid received from Central and State Governments for implementation of welfare schemes for various sections of society are totally utilized for such purpose, there is no service provider-client relationship between assessee and Government. Only utilisation of money for agreed purposes will not result in service provider-client relationship; a client must not only pay the expenses of the service but also the consideration or reward for the service to the service provider. The Hon'ble Supreme Court affirmed the CESTAT, Bangalore Bench in the case of APITCO Ltd. vs. Commissioner of Service Tax, Hyderabad [2010] 29 STT 262 4.1.2 The Appellant has been doing trainings and implementing CSR projects as stated in the Statement of Facts, in the field of competition law, market regulations, finance, corporate governance and public policies, whereby the Appellant has been incurring cost, for which Appellant was in receipt of grant in aid to compensate for the cost of research. Normally, when Appellant has made planning for any research, they would calculate t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Central Government and MP Government and received grants-in-aid in respect of these activities, consideration received was not liable to service tax under category of management consultancy services. The impugned contract of IICA fulfilled the following undisputed criteria: (i) The Appellant received a grant for executing specific charitable activities. (ii) The entire amount received was subject to actual utilization the Appellant had no right or possibility to generate any surplus out of the contract. (iii) The Appellant is a registered charity eligible to undertake grant based activity for charitable purposes. (iv) The unspent balance (if any) is subject to refund or directions of the donor. (v) There is no reward or benefit offered other than the actual expenditures towards charitable purposes. (vi) The above facts have not been disputed by the AAR and therefore the light of the judicial precedence (supra) the order is liable to be quashed. 4.2 Ground No. 2: That the advance ruling authority has failed to understand that the entire grant was subject to actual utilization and the unspent balance belonged to the donor; such contract to implement development activ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount granted should be subject to actual utilization and the unspent balance if any should belong to the donor. (ii) Activities having a component of supply which could be considered as "in the course or furtherance of business" are taxable under GST. However, some of such activity may be specifically exempt under GST. (iii) Activities having a component of supply but are not "in the course or furtherance of business" are not taxable under GST. In such cases the onus will be on the NPO to establish that the activity was not "in the course or furtherance of business". 4.2.3 The impugned contract fell in the first category as the Appellant is merely implementing the contract on behalf of the donor, the grant is subject to actual utilization and the unspent balance is required to be refunded. Therefore, it cannot be treated as a contract "in the course or furtherance of business" and the provisions of GST cannot be applied. 4.2.3 In GST, for any activity to be considered as supply, it has to first to pass the test of business under section 2(17)(a) of the Act and should also be covered in scope of supply under section 7 of the Act. Further, the term, "supply" has been inclusivel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l invoice. In this particular case the term `Dharmada' has been used which means `towards charity'. The court held that any money received from the customers towards charity was under a legal obligation to be spent for a specific purpose, therefore it could not be treated as a trading receipt. 4.3.1 Similar view were expressed by the Supreme Court in the case CIT vs. Tollygunge Club Ltd [1977] 107 ITR 776, here the Supreme Court considered the question substantially similar to the one referred above, in this case the assessee was a social and sports club one of whose activities consisted of conducting horse races with amateur riders. It charged for admission into the enclosure of the club at the time of the races from the race goers. The assessee passed resolution at general meeting for levying surcharge for local charities in addition to admission fees. The receipts from the surcharge were not credited to the profit and loss account but they were carried directly to a separate account styled "charity account". It was held that such income cannot be treated as trade receipt or income of the assessee. Reliance was also placed on the following case laws (i) Vazir Sultan To ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d for Personal Hearing and reiterated the written submissions. During the personal hearing, it was pointed out by the Members that the appeal was filed beyond the period of 60 days from the date of receipt of the advance ruling. 6.1 On being pointed out that the Appeal was hit by limitation of time and hence not maintainable, the Ld. Advocate requested for submission of additional materials on the issue within a fortnight and the same was submitted on 20.4.2022 by email wherein it was primarily contended that the Appellant was under the impression that the Appellate Authority was not constituted and the Appellant had addressed a mail dated 23.01.2020 to the GST Council. In response to which the Appellant received a letter dated 30.01.2020 from the GST Council that the Appellate Authority had been constituted vide Notification dated 3.09.2019. The Appellant relied upon the decision of the Hon'ble Supreme Court in the case of Land Acquisition Collector Vs. State of J & K (1997) 2 SCC 107 in support of their contention as to why the appeal is not hit by limitation. DISCUSSION AND FINDINGS 7. We have carefully gone through the records of the case and taken into consideration the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appropriate to dispose of the M.A. No. 21 of 2022 with the following directions: III. In cases where the limitation would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 01.03.2022. In the event the actual balance period of limitation remaining, with effect from 01.03.2022 is greater than 90 days, that longer period shall apply." 7.4 It has been, inter alia, the contention of the Appellant that the Appellant was prevented from filing an appeal as the Appellate authority for Delhi Zone was not constituted when the advance ruling order was issued. This contention has been examined and it is seen that in terms of section 99 of the Act, the Appellate Authority for Advance Ruling constituted under the provisions of a State Goods and Service Tax Act, 2017 shall be deemed to the Appellate Authority in respect of that State. 7.5 In connection with the Notification issued by the Govt of NCT of Delhi, we note that a Notification was issued on 3rd September, 2019 vide F.3(6)/Fin.(Rev.-I)/2018-19-DS-VI/389 wherein the Chief Commissioner of Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imitation Act would not be applicable. Para 8 of the judgment is reproduced below for the ease of understanding: "8. The Commissioner of Central Excise (Appeals) as also the Tribunal being creatures of Statute are vested with jurisdiction to condone the delay beyond the permissible period provided under the Statute. The period upto which the prayer for condonation can be accepted is statutorily provided. It was submitted that the logic of Section 5 of the Indian Limitation Act, 1963 (in short the 'Limitation Act') can be availed for condonation of delay. The first proviso to Section 35 makes the position clear that the appeal has to be preferred within three months from the date of communication to him of the decision or order. However, if the Commissioner is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of 60 days, he can allow it to be presented within a further period of 30 days. In other words, this clearly shows that the appeal has to be filed within 60 days but in terms of the proviso further 30 days time can be granted by the appellate authority to entertain the appeal. The proviso to sub-secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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