9911796707
TMI Blog2024 (8) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... ,400/- Interest : Rs. 4,40,29,740/- Rs. 48,99,00,540/- 3. It is case of the petitioner that the petitioner is providing services to the National Highways Department of India and that the considerations are received in two parcels. According to the petitioner, 40% of the consideration is received during the execution of work and remaining 60% of the consideration is received annually over the next 14 years. 4. It is submitted that the contention of the Department is that since the work has been substantially completed, the petitioner was liable to pay tax on the entire value of the work. It is submitted that such a stand is unjustified. 5. The learned counsel for the petitioner has placed reliance on a CBIC Circular No.221/15/2024-GST dated 26.06.2024 issued recently by the Central Board of Indirect Taxes [CBIT], wherein, issue as to the time of supply for the purpose of payment of tax for service under the Hybrid Annuity Model [HAM] was considered. It is submitted that under HAM of National Highways Authority of India (NHAI), the concessionaire has to construct the new road and provide Operation and Maintenance service which is generally spread over a period of 15-17 years and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of completion of that event. 2.4 Accordingly, as per section 13(2) of CGST Act, read with section 31(5) of CGST Act, time of supply of services under HAM contract, including construction and O&M portion, should be the date of issuance of such invoice, or date of receipt of payment, whichever is earlier, if the invoice is issued on or before the specified date or the date of completion of the event specified in the contract, as applicable. However, in cases, where the invoice is not issued on or before the specified date or the date of completion of the event specified in the contract, as per clause (b) of section 13(2), time of supply should be the date of provision of the service, or date of receipt of payment, whichever is earlier. In case of continuous supply of services, the date of provision of service may be deemed as the due date of payment as per the contract, as the invoice is required to be issued on or before the due date of payment as per the provisions of Section 31(5) of CGST Act. 3. In the light of above, it is clarified that the tax liability on the concessionaire under the HAM contract, including on the construction portion, would arise at the time of issuanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner is to receive payments in 30 Annuities as per Clause 23.6.3 of the above said Contract with the National Highways Authority of India. Clause 23.6.3 reads as under:- 23.6. Annuity Payments during Operation Period 23.6.3. Each of the Annuity Payments due and payable during the years following the COD shall be as under: Annuity following the COD Percentage of Completion Cost remaining to be paid on COD 1st Annuity 2.10% 2nd Annuity 2.17% 3rd Annuity 2.24% 4th Annuity 2.31% 5th Annuity 2.38% 6th Annuity 2.45% 7th Annuity 2.52% 8th Annuity 2.60% 9th Annuity 2.68% 10th Annuity 2.76% 11th Annuity 2.84% 12th Annuity 2.93% 13th Annuity 3.02% 14th Annuity 3.11% 15th Annuity 3.20% 16th Annuity 3.30% 17th Annuity 3.40% 18th Annuity 3.50% 19th Annuity 3.61% 20th Annuity 3.72% 21st Annuity 3.83% 22nd Annuity 3.94% 23rd Annuity 4.06% 24th Annuity 4.18% 25th Annuity 4.25% 26th Annuity 4.25% 27th Annuity 4.44% 28th Annuity 4.71% 29th Annuity 4.75% 30th Annuity 4.75% 9. It is submitted that the issue has now been clarified in Paragraph 3 of CBIC Circular No.221/15/2024-GST dated 26.06.2024, the content of which has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppression of taxable turnover by wilful misstatement of facts as defined under Sec.74 of the TNGST and CGST Act 2017. 9. It is submitted that the Assessing Officer have found that the assesses have reported a turnover of Rs. 208,94,72,648/- only and claiming exemption on the supply of works completed for Rs. 2983755027/- for which the Turnkey Project contractor have issued Tax invoice and collected output tax, which tax is taken by the assessee as input tax for 2019-20. The assesses have not reported works contract completed for which the Turnkey project contract have issued Tax invoice. There is no proposal to levy tax on annuities in the year 2019-20. The only proposal is to disallow the claim of exemption on works contract completed and supply made to the recipient. Time of supply in the case of services is determined as per Section 13 of the TNGST and CGST Acts 2017 read with Sec.31, is the earliest of the following a)The date of issue of invoice by the supplier, if the invoice is issued within the period prescribed under Section 31, or the date of receipt of payment whichever is earlier; or b)The date of provision of service, if the invoice is not issued within the perio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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