TMI Blog2024 (4) TMI 845X X X X Extracts X X X X X X X X Extracts X X X X ..... e actual recipient of service is the deemed supplier/registered person for the purpose of fulfilling other conditions in para / 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, 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 LET 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 Anish Goyal. CA Brief facts: M/s Waaree Energies Limited (for short -'applicant'), 231-236, Diamond Park, SEZ, Sachin, Sur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lication in this case; that as an alternate plea, even if it is assumed that RCM notifications are applicable, then also in terms of Section 16 of the IGST Act, 2017 the applicant can exercise the option to provide LUT, in respect of supplies made from DTA to an SEZ unit in terms of section 16(3), ibid, that even in the erstwhile regime, CBIC vide its Circular No. 142/11/2011-ST dated 18.05.2011, had clarified that there is no difference in treatment of service tax paid under forward charge or reverse charge; that they would like to rely on the ease of,- M/s GMR Aerospace Engineering Limited [2019 (31) GSTL 593 (AP)]; M/s Portescap India Pvt Ltd. [Order No. MAH/AAAR/DS-RM/15/2022-23 dt. 13.01.2023 reported in 2023(1) TMI 1092]; M/s Darshan Bordlam Ltd [2013 (287) E.L.T 401 (Guj.)]; Interglobe Aviation Ltd [2022 (379) E.L.T. 200 (Del.)]; Damodar J. Malpani [2002 (146) ELT 483 (SC)]; Steel Authority of India [2000 (115) ELT 42 (SC)]; 4. In view of the foregoing, the applicant is before us seeking a ruling on the below mentioned question viz 1. Whether the applicant being an SEZ unit is required to pay tax under reverse charge mechanism on specified services in accordance with notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g zero rated supply shall be eligible to claim refund of unutilised input tax credit on supply of goods or services or both, without payment of integrated tax, under bond or Letter of Undertaking, in accordance with the provisions of section 54 of the Central Goods and Services Tax Act or the rules made thereunder, subject to such conditions, safeguards and procedure as may be prescribed: Provided that the registered person making zero rated supply of goods shall, in case of non-realisation of sale proceeds, be liable to deposit the refund so received under this sub-section along with the applicable interest under section 50 of the Central Goods and Services Tax Act within thirty days after the expiry of the time limit prescribed under the Foreign Exchange Management Act, 1999 (42 of 1999.) for receipt of foreign exchange remittances, in such manner as may be prescribed. Notification No. 10/2017-Integrated Tax (Rate)] as amended] [relevant extracts] dated : 28.06.2017 In exercise of the powers conferred by sub-section (3) of section 5 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017), the Central Government on the recommendations of the Council hereby notifies that on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1948(63 of 1948); or (b) any society registered under the Societies Registration Act. 1860 (21 of 1860) or under any other law for the time being in force in any part of India; Or (c) any co-operative society established by or under any law; or (d) any person registered under the Central Goods and Services Tax Act or the Integrated Goods and Services tax Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act; or (e) any body corporate established, by or under any law; or (f) any partnership firm whether registered or not under any law including association of persons; or (g) any casual taxable person; located in the taxable territory. 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. 16 Security services ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to such terms, conditions and limitations, as may be prescribed, be exempt from the payment of taxes, duties or cess under all enactments specified in the First Schedule. o Section 51 : Act to have overriding effect. The provisions of this 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. Special Economic Zones Rules, 2006 o Rule 5. Requirements for establishment of a Special Economic Zone. - (5) Before recommending any proposal for setting up of a Special Economic Zone, the State Government shall endeavor that the following are made available in the State to the proposed Special Economic Zone Units and Developer, namely: - (a) exemption from the State and local taxes, [State Goods and Services Tax,] levies and duties, including stamp duty, and taxes levied by local bodies on goods required for authorized operations by a Unit or Developer, and the goods sold by a Unit in the Domestic Tariff Area except the goods procured from domestic tariff area and sold as it is; o 30. Procedure for procurements from the Domestic Tariff Area.- [ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y u/s 16(3) of the IGST Act, 2017. 11. We find that the FAQs on GST, 3rd edition, dated 15.12.2018, on the question of payment of IGST under RCM, when received by an SEZ unit has clarified as under: Q 41. Whether SEZ unit or developer needs to pay IGST when it received supplies which are under reverse charge mechanism? Ans . All supplies to SEZs are zero rated. However, the suppliers are given two options. In this case, the supplier is not liable to pay GST as the supply is under reverse charge mechanism. The recipient is considered as deemed supplier Therefore. SEZ has to pay GST in this case. 12. However, we also find that under notification No. 37/2017-CT, a unit in DTA can supply services to a unit in SEZ without payment of IGST subject to furnishing of LUT to the jurisdictional Commissioner. The relevant extracts of the notification are reproduced below for case of understanding viz [relevant extracts] Notification No. 37/2017-Central Tax dated 4.10.2017 G.S.R. .. .(E).-In exercise of the powers conferred by section 54 of the Central Goods and Services Tax Act, 2017, and section 20 of the Integrated Goods and Services Tax Act, 2017, sub-rule (5) of rule 96A of the Central Good ..... X X X X Extracts X X X X X X X X Extracts X X X X
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