TMI Blog2024 (4) TMI 844X X X X Extracts X X X X X X X X Extracts X X X X ..... n condition no. (i) in para 1 of notification No. 37/2017-CT. The actual recipient of service is the deemed supplier/registered person for the purpose of fulfilling other conditions in para 1 of the notification ibid including the manner of furnishing of Letter of Undertaking. There is no denying the fact that the aforementioned clarification was given to a specific SEZ unit and is not a circular. However, we find that there is no bar in borrowing the rationale of the aforementioned clarification. Hence, we find that the applicant, an SEZ unit, can procure the services mentioned supra, for use in authorized operations without payment of IGST provided the applicant, furnishes a LUT or bond as specified in condition (i) of para 1 of notification No. 37/2017-CT. The applicant, an SEZ unit, is not required to pay GST under RCM on specified services in accordance with notification No. 10/2017-IT(Rate) dated 28.6.2017 as amended from time to time, subject to furnishing a LUT or bond as specified in condition (i) of para 1 of notification No. 37/2017-CT. - MILIND KAVATKAR AND AMIT KUMAR MISHRA, MEMBER Present for the Applicant : Shri Devam S Sheth, CA Brief facts: M/s Abans Alternative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Rules reveal that the RCM notifications will not apply; that the default list of services approved by the Department of Commerce (F. No. D. 12/19/2013-SEZ dated 02.01.2018) for authorized operations specifically includes Legal Consultancy services; that there can be no liability under the notification No. 13/2017-CT(R) on an SEZ unit, since the service received by them would be considered as a zero-rated service; the applicant is entitled to avail the option available u/s 16, ibid for zero-rated supplies by providing an LUT for the supplies; that the applicants are not required to discharge GST under RCM but can receive supplies on the basis of an LUT as an option; that as an alternate argument, even if it is assumed that RCM notifications are applicable, then also the SEZ unit, in terms of Section 16 could exercise the option to provide LUT for supplies made from DTA to an SEZ unit; that they wish to rely on letter F. No 334/335/2017-TRU dated 18.12.2017, regarding RCM liability on procurement of service by International Financial Services Centre, SEZ which clarifies that a Unit in SEZ or SEZ developer can procure such services, where they are required to pay GST under revers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ST 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 GGST Act. 8. We have considered the submissions made by the applicant in their application for advance ruling as well as the submissions made during the course of personal hearing. We have also considered the issue involved, the relevant facts the applicant's submission/interpretation of law in respect of question on which the advance ruling is sought. 9. Before adverting to the submissions, we would like to reproduce the relevant provisions/notifications for ease of reference: Integrated Goods and Services Act 2017 o Section 5. Levy and collection.- (3) 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 all 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. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Tablet- Table SI.No. Category of Supply of Services Supplier of service Recipient of Service (1) (2) (3) (4) 3 [Services provided by an individual advocate including a senior advocate or firm of advocates by way of legal services, directly or indirectly. Explanation ,- legal service means any service provided in relation to advice, consultancy or assistance in any branch of law, in any manner and includes representational services before any court, tribunal or authority.] An individual advocate including a senior advocate or firm of advocates. Any business entity located in the taxable territory. Notification No. 18/2017-Integrated Tax (Rate) dated 5.7.2017 In exercise of the powers conferred by sub-section (1) of section 6 of the Integrated Goods and Service Tax Act, 2017 (13 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do and on the recommendations of the Council, hereby exempts services imported by a unit or a developer in the Special Economic Zone for authorised operations, from the whole of the integrated tax leviable thereon under section 5 of the Integrated Goods and Service tax Act, 2017 (13 of 2017). Special Econo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort by a manufacturer or supplier.] 10. The applicant's case is that in respect of legal services from advocate, a recipient of service is required to pay GST under RCM in terms of notification No. 10/2017-IT (Rate) [incorrectly mentioned as notification No. 13/2017-CT (R)], reproduced supra. However, the applicant further states that being an SEZ unit, Rule 5(5)(a) of the SEZ Rules, 2006, provides exemption from SGST; that Rule 30(1), ibid., enables a DTA supplier to clear services to an SEZ unit as in the case of zero rated supply in terms of section 16 of IGST Act, 2017, cither under bond or under legal undertaking or under any other refund procedure permitted under the GST law; that notification No. 18/2017-IT (Rate) exempts service imported by unit in SEZ for authorized operation from the whole of IGST leviable u/s 5, ibid', that even otherwise, section 51 of the SEZ Act, 2005, which is a non-obstante clause, clearly states that the provisions of the SEZ Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act. In view of the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dertaking in place of a bond except those who have been prosecuted for any offence under the Central Goods and Services Tax Act, 2017 (12 of 2017) or the Integrated Goods and Services Tax Act, 2017 (13 of 2017) or any of the existing laws in force in a case where the amount of tax evaded exceeds two hundred and fifty lakh rupees; On a similar issue, wherein clarification was sought, as to whether the SEZ unit is liable to pay GST in respect of legal services, sponsorship services etc received by an SEZ unit in IFSC, Gandhinagar, from a unit in DTA, which are chargeable to GST under RCM, Tax Research Unit, CBIC, New Delhi, clarified as under:- 3. Since the intention of the Legislature is not to tax supplies to a unit in SEZ or a SEZ Developer which have been zero rated under clause (b) of section 16(1) of the IGST Act, by virtue of deeming provision under section 5(3) of the IGST Act, 2017, levy for procurement of input services specified under notification No. 13/2017-CT (Rate) falls upon the unit in SEZ or the SEZ developer. It is, therefore clarified that a unit in SEZ or the SEZ developer can procure such services, where they are required to pay GST under reverse charge, without ..... X X X X Extracts X X X X X X X X Extracts X X X X
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