👍👍👍👍👍👍👍Complete Case Digest of Maharashtra AAR (Part 1)

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Goods and Services Tax Authority for Advance Ruling (GST AAR)  is  a quasi-judicial body established in India under the GST Act of 2017. The GST AAR is in charge of issuing binding rulings on the interpretation of GST legislation and rules for individual transactions or activities prior to their execution.

It is made up of one or more members chosen by the central government who are eligible to sit on a High Court bench. The authority has the authority to hear and decide the application within 90 days after its receipt.

12% GST chargeable by Sub-Contractors to Main Contractor on Works Contract Services pertaining to Railways In Re: M/s Shree Construction

The Authority for Advance Rulings (AAR), Maharashtra ruled that 12% Goods and Services Tax (GST) would be applicable to the services provided by sub-contractors to the main contractors in respect of Works Contract Services pertaining to Railways. The authority noted that “In respect of Sr. No, 3 of Notification No. 11/2017 dated 28.06.2017 as amended up till today, even the sub-contractor providing services of composite supply of works contract in respect of original works pertaining to railways would be covered for concessional rate of GST at 12% as given under Sr. No. 3 of Notification No. 11/2017 as amended referred above.”

GST applicable on Construction of Flats to be given on Lease In re: M/s Nagpur Integrated Township Private Limited

The State Appellate Authority of Advance Ruling (AAAR), Maharashtra has recently held that GST was rightly levied on real estate developers engaged in the development of land and construction of flats to be given on lease. The AAAR has observed that normally the flats given on lease are completed flats with occupancy certificates, and the general lease rent in the Mumbai market amounts to 2 percent to 3 percent of the property value per month. It, however, found that the amount paid as the lease consideration without having possession of the land was around 50 percent to 60 percent of the price of ready-to-move flats.

Frozen Sheep / Goat Carcass Supplied in LDPE & HDPE Bags liable to GST In re: M/s Ahmednagar District Goat Rearing and Processing Co-op Federation Limited

The Maharashtra Authority for Advance Ruling (AAR) has recently held that the whole sheep/goat animal carcass in its natural shape in frozen state in different weight and size packed in LDPE bags without mentioning the weight and one or two such LDPE bags further packed in HDPE bags being supplied to Army by applicant against tender shall qualify as product put up in unit container. The Authority composed of Members B.V. Borhade & Pankaj Kumar found that the definition of unit container provided in the both notifications include bags. As one HDPE bag contains two LDPE bags, and as the army persons concerned are aware of such fact, the members opined that the bags had a pre-determined number. They also noted that the weights written outside the HDPE bags also satisfy the requirement of the words “predetermined number indicated on such a package” as per the definition of ‘unit container’.

12% GST on Agreement of Supply of Services on Transportation of Goods by Road In re: POSCO India Steel Distribution Centre Private Limited

The Maharashtra Authority of Advance Ruling (AAR) ruled that 12% of GST is applicable to the agreement of supply of services in relation to transportation of goods by road. “GST applicable in this case will be covered under Entry of the Notification 11/2017 (CT) Rate dated 28 June 2017 subject to conditions mentioned therein i.e. a GST Rate of 5% will be applicable provided that credit of input tax credit charged on goods and services used in spring the services had not been taken and in the alternative GST Rate of 12% will be applicable, provided that the applicant, goods transport agency, opting to pay central tax 6% under this entry on all the services GTA supplied by it,” the AAR ruled while addressing the issue pertaining to GST rate on the services.

Non Submission of Records: Maharashtra AAR refuses to determine (HSN) Tyre Pyrolysis Oil under CGST In re: Royal Carbon Black Private Limited

The Maharashtra Authority for Advance Rulings ( AAR )declined from determining classification (HSN) of Tyre Pyrolysis oil and the tax rate applicable to it, by reason of nonsubmission of full details pertaining to composition of the impugned product by the applicant. Upon finding that the proper classification would require records showing the composition of Pyrolysis oil, the Maharashtra Authority for Advanced Hearing, though directed the applicant to submit the same, no authentic test reports or other was produced by the applicant, apart from a general submission that the composition may vary depending upon the tyre recycled.  Thus, in the view of non-submission of records by the applicant, the Maharashtra Authority for Advanced Hearing, declined from classifying tyre Pyrolysis oil.

Garbage tipper vehicle supply by TATA motor vehicle attracts 28% GST In Re: M/s Tata Motors Limited CITATION: 2023 TAXSCAN (AAR) 153

The Maharashtra Authority for Advance Ruling (AAR) has held that the supply of garbage tipper vehicles by TATA Motor Vehicle would  attract 28% of Goods and Service Tax (GST). The Maharashtra bench of Rama Mohan Rao and TR Ram Nani  held that the vehicle manufactured by the applicant could not be termed as the special purpose vehicle and the certificate issued by the applicant itself had mentioned the vehicle as a good carrier. The bench further held that the vehicle would come under the entry of 8074 as motor vehicle for transportation of goods  only and the applicant had already admitted the fact and the bench further ruled that the  GST @ 28% instead of 18% rate would be applied  on the garbage vehicle supply.

IGST Applicable to Transfer of Monetary Proceeds by IVL India under Reverse Charge Mechanism In Re: M/s. IVL India Environmental R&D Private Limited CITATION:   2023 TAXSCAN (AAR) 152

The Maharashtra Authority for Advance Ruling (AAR) has held that the Integrated Goods and Service Tax (IGST) would be applied to transfer of monetary proceeds by IVL India under the reverse charge mechanism. The two-member bench of M. Rammohan Rao (additional commissioner of income tax – member)and T.R. Ramanan i(joint commissioner of state tax-member) observed that as the applicant had received support services from IVL Sweden, which was located in a non-taxable territory, the entire integrated tax leviable under Section 5 of the Integrated Goods and Services Tax Act should be paid on the reverse charge basis by the applicant for such services.

Pallets, Crates leased by CHPL India, in Maharashtra to other GST Registrations located in India, is Lease Transaction, Taxable as Supply of Services In Re: M/s.CHEP India Private Limited CITATION: 2023 TAXSCAN (AAR) 117

The Authority for Advance Ruling (AAR) Maharashtra, ruled that Pallets, crates leased by CHEP India Private Limited (CHPL), in Maharashtra to other GST Registrations located in India, is lease transaction and taxable as supply of services. A Two Member Bench of the Authority comprising M Rammohan Rao and T R Ramnaniruled that “Pallets, crates and containers leased by CHEP India located and registered in Maharashtra to its other GST registrations located across India is considered as lease transaction and accordingly taxable as supply of services in terms of Section 7 of the CGST Act and MGST Act.”

Recovery of 50% of Parental Health Insurance Premium from Employees does not Amount to Supply In re: M/s Jotun India Pvt Ltd

The Maharashtra bench of the Authority for Advance Ruling ( AAR ) in an application filed by Jotun India Pvt. Ltd. held that the recovery of 50% of the Parental Health Insurance Premium from employees does not amount to supply of service.The Bench held that the applicant is not engaged in the ‘business’ of providing insurance coverage. Further, provision of parental insurance cover is not a mandatory requirement under the present laws and not provision of the same shall not affect the applicant’s business in any way. Hence, the activity in question cannot be treated as an activity done in the course of business or in furtherance of business.

GST not applicable on Adoption Fees received from Adoptive Parents by Trust under Adoption Law  In re: M/s Children of the World Trust India

The Authority of Advance Ruling in Maharashtra has ruled that, Goods and Services Tax ( GST ) is exempted on Adoption Fees received from Adoptive parents by Trust under Adoption Law. The AAR bench of B.Timothy and A.A Chahure observed that, “The activities conducted by the applicant are “Charitable Activities” which are exempted under Notification No.12/2017- Central Tax (Rate) dated 28.06.2017 as amended. The receipt of the Adoption Fees paid under Regulation 46 of the Adoption Regulations, 2017 by the Prospective Adoptive Parents to the Trust is exempted from the levy of Goods and Services Tax exempted under Notification No.12/2017- Central Tax (Rate) dated 28.06.2017 as amended”.

Fludeoxyglucose or ‘FDG’ cannot be classified under chapter 3006 3000 of the Central Excise Tariff Act, 1985  In re: M/s HAFELE INDIA PRIVATE LIMITED

The Authority for Advance Ruling (AAR) Maharashtra couple recently ruled that Fludeoxyglucose or FDG, a medicinal drug used in medical scanning, not to be classified under chapter 3006 3000 of the Central Excise Tariff Act, 1958. Along with a query regarding the classification of FDG in the aforementioned manner, it was also asked whether chemicals used as pharmaceuticals that are inorganic or/ and of organic nature shall merit classification only under chapter 28, 29 and not under chapter 30 which has been specifically carved out for the chemical pharmaceuticals. However, the authority members B.V. Borhade and Pankaj Kumar chose not to entertain as the query was not specific and general in nature.

ITC not Available on Goods and Services Consumed for Construction of Pipeline Laid outside Factory PremisesIn Re:M/s MUMBAI AVIATION FULE FARM FACILITY PRIVATE LIMITED CITATION: 2023 TAXSCAN (AAR) 147

The Maharashtra Authority of Advance Ruling (AAR) has held that Input Tax Credit (ITC) is not available on goods and services consumed for the construction of a pipeline which was laid outside the factory premises. The two-member bench of M. Rammohan Rao and T.R. Ramnani has ruled that pipelines laid outside factory premises are not covered within the term ‘plant and machinery’ as per Explanation to Section 17(5)(c) and 17(5)(d) of the Central Goods and Services Tax Act, 2017 (“the CGST Act”), and therefore the inputs used for construction of such pipeline outside the factory are not eligible to Input Tax Credit (“ITC”).

No Ruling can be given on Past and Completed Supply: AAR rules against United Breweries In Re: M/s.United Breweries Limited CITATION: 2023 TAXSCAN (AAR) 118

The Maharashtra Authority for Advance Ruling (AAR), held that no ruling can be given on past and completed supply, thereby ruling against United Breweries Limited, the applicant. A Two Member Bench of the Authority comprising M Rammohan Rao and TR Ramnani, ruled that “Based on the submissions made by the applicant and hearings conducted, the subject application is rejected as being non-maintainable as per Section 95 of the CGST Act, 2017 because the questions raised by the applicant are in respect of past and completed supply as on the date of the application and not supply, which is being undertaken/proposed to be undertaken.”

Glaze Gels attract 18% GST In Re: M/s. HEALTHY LIFE FOODTECH PRIVATE LIMITED CITATION: 2022 TAXSCAN (AAR) 289

The Maharashtra Authority of Advance Ruling ( AAR ) has held that glaze gels attract 18% GST. M/s Healthy Life Foodtech Pvt. Ltd., the Applicant, registered under MGST Act, 2017 manufactures the impugned product namely GLAZE GELS and markets it to Bakeries all across India. Since the impugned product is a type of confectionery made of sugar, the two-member bench of M. Rammohan Rao and T.R. Ramnani has held that “the impugned product falls under Chapter Heading 17.04, which covers ‘Sugar Confectionery (including white chocolate), not containing cocoa. 5.8 As per Sr. No. 12 of Schedule III of Notification No. 01/2017 — Central Tax (Rate) dated 28.06.2017, ‘Sugar confectionery (excluding white chocolate and bubble/chewing gum) [other than bura, batasha]’ falling under Chapter Heading 1704 attracted GST at 18%.”

Transfer of Monetary Proceeds without underlying Import of Services are liable to IGST under RCM In Re: M/s. IVL India Environmental R&D Private Limited CITATION: 2022 TAXSCAN (AAR) 288

The Maharashtra Authority for Advance Ruling (AAR) has recently ruled that the transfer of monetary proceeds without underlying import of services by M/s. IVL India Environmental R&D Private Limited is liable to be taxed under Integrated Goods and Services Tax (IGST) as per the Reverse Charge Mechanism (RCM). The Authority Bench of members M Rammohan Rao and T R Ramani observed that, the “services are received by the applicant from IVL to further perform its services under the contract, for which monetary proceeds flow from the applicant to IVL Sweden.”

Stipend to Trainees won’t attract GST In Re: M/s Patle Eduskills Foundation CITATION:   2022 TAXSCAN (AAR) 194

The Maharashtra bench of Authority for Advance Rulings (AAR) has held that the amount of stipend provided to trainees would not attract GST. Since the facts are similar to the facts of the subject case, the court had no reason to deviate from our ruling given in the said case which is also applicable in the subject case. It was decided that the stipend amount does not form a part of the taxable value,” the AAR said.

PV DC Cables attract 18% GST In Re:M/s Leoni Cable Solutions Private Limited CITATION: 2022 TAXSCAN (AAR) 195

The Authority of Advance Ruling (AAR), Maharashtra bench has held that 18% GST is payable on PV DC cables. The applicant has sought an advance ruling on the issue in respect of GST rates on PV DC Cables manufactured and supplied by Leoni Cable Solutions (India) Pvt Ltd to its customers who are into the business of manufacturing solar power generating systems or EPC companies setting up a solar power plant. A bench consisting of Rajiv Magoo and T.R. Ramnani, has ruled that the PV DC cables manufactured and supplied by the applicant to its customers would be classified under Entry number 395 of Schedule III of Notification No. 1/2017-Central Tax (Rate) (as amended) dated June 28, 2017, and liable to GST at 18%.

GST not applicable on Lease Income from Residential Property  In Re: M/s Kasturi & Sons Ltd CITATION: 2022 TAXSCAN (AAR) 192

The GST Authority for Advance Ruling (AAR), Maharashtra bench has held that the GST shall not be applicable on the lease income from the residential property. Mr. Rajiv Magoo (Central Tax Member) and Mr. T R Ramnani (State Tax Member) was considering an application filed by M/s Kasturi & Sons Ltd, seeking a clarification that whether the applicant is eligible for the exemption from payment of GST on the monthly license fee to be received on the proposed leave and licensing of residential property.

GST not leviable on Fees collected for Training on Football, Basketball, Athletics, Cricket, Swimming, Karate, and Dance  In Re: M/s Navi Mumbai Sports Association CITATION:   2022 TAXSCAN (AAR) 190

The Maharashtra Advance Authority for Ruling (AAR) bench consisting of Rajiv Magoo, Additional Commissioner of Central Tax, and T R Ramnani, Joint Commissioner of State Tax held that GST is not leviable on Fees collected for training in respect of Football, Basketball, Athletics, Cricket, Swimming, Karate, and Dance. The AAR observed that “football, basketball, athletics, cricket, swimming, and karate are sports, and “dance” would be covered under arts. However, physical fitness cannot be considered a sport, art, or culture. Further, the term “summer coaching” is a general term which cannot cover sports, arts, or culture.

Annual Subscription and Maintenance Fees not leviable as GST  In Re: M/s Navi Mumbai Sports Association CITATION: 2022 TAXSCAN (AAR) 190

The Maharashtra Advance Authority for Ruling (AAR) bench consisting of Rajiv Magoo, Additional Commissioner of Central Tax, and T R Ramnani, Joint Commissioner of State Tax held that annual subscription and maintenance fees are not leviable as GST. The sports complex is equipped with various facilities for achieving its objectives, which include indoor badminton, squash, table tennis courts, gym and health club, retiring rooms, football and cricket grounds, swimming pools, restaurants, conference halls, etc.

18% GST applicable on Composite Supply under Works Contract  In Re: M/s KPC Projects Ltd. CITATION: 2022 TAXSCAN (AAR) 189

The Maharashtra Authority of Advance Ruling ( AAR ) has held that 18% GST is applicable on Composite supply under works contract. The Coram of Mr. Rajiv Magoo (Central tax) and Mr. T. R. Ramnani (State tax) has held that “the impugned activity is not covered under Sr. No. 3 (vi) of Notification 11/2017 and therefore the said activity will be covered under the residuary clause (xii) of Sr. No. 3 Notification No. 11/2017 – mentioned above and the rate of GST to be paid by the applicant will be 18% of the taxable value”.

Mining Support Service Chargeable to GST at 18%  In Re: M/s BARANJ COAL MINES PRIVATE LIMITED CITATION: 2022 TAXSCAN (AAR) 188

The Maharashtra Authority of Advance Ruling ( AAR ) has held that mining support services are chargeable to Goods and Service Tax at 18%. The Authority observed that the said agreement clearly proves that the owner of the coal is KPCL and not the applicant. Therefore, there is no supply of coal by the applicant, purely because the applicant neither has any ownership rights on the coal nor has any right to sell the coal that is excavated by it. Hence, the applicant is involved in the supply of services and there is no supply of coal by the applicant.

GST: Change in Constitution of the Business is Essential to constitute ‘going concern’ u/s 18, rules AAR In Re:M/s Crystal Crop Protection Limited CITATION:2022 TAXSCAN (AAR) 180

The Maharashtra Authority of Advance Ruling (AAR) has held that change in the constitution is essential to constitute going concern u/s 18  of CGST Act 2017. It was observed that u/s Section 18, the change in the constitution of the business is essential otherwise, it cannot be said that there is the transfer of a business as a goingconcern.Further, as per Sr. No. I of Schedule I to the CGST Act, ‘Permanent transfer or disposal of business assets where input tax credit has been availed on such assets will be treated as supply even if made without consideration. MAAR consists of Shri. Rajiv Magoo, Member Central Tax and Shri. T. R. Ramnani, Member State Tax in light of the case of M/S Shilpa Medicare Limited has held that the activity is a going concern and classified it to be a supply of service.

GST: Intermediary Marketing Services provided can’t be classifiable as Export u/s 2(6), rules AAR  In Re: M/s GULF TURBO SOLUTIONS LLP CITATION:   2022 TAXSCAN (AAR) 183

The Maharashtra Authority of Advance Ruling ( AAR ) has held that intermediary marketing services provided cannot be classifiable as export u/s 2(6) of the IGST Act. The Coram of Mr Rajiv Magoo (Central tax) and Mr T. R. Ramnani (State tax) has held that the place of supply in the subject case of the applicant as an intermediary would be the location of the supplier of services under Section 13 (8) of the IGST Act, 2017. It was observed that the location of the applicant is located in the State of Maharashtra, India. It was held that as the place of supply of intermediary services to GTRS is in India and consequently, condition (iii) of export of services as per Section 2(6) of IGST Act is not satisfied.

GST: Incentives Received for Market Services within India cannot be Considered as Trade Discount nor Export Service, rules AAR In Re:M/s MEK Peripherals India Pvt Ltd CITATION:2022 TAXSCAN (AAR) 181

The Maharashtra Authority of Advance Ruling (AAR) has held that incentives received for market services within India cannot be considered as Trade discount nor export service. The Coram of Mr. Rajiv Magoo (Central Tax) and Mr. T. R. Ramnani (State Tax) has held that “the marketing services are provided in respect of goods which are made physically available by the recipient of services (IIUL, through distributors) to the supplier of marketing services (applicant), in order to provide the services. Therefore, as per section 13 (3) (a), the place of provision of services is the location of the supplier of services i.e, the applicant, which is in India. Hence, we hold that the impugned supply does not qualify as export of services”.

Service Provided by Educational Institution to its Students and Staff attracts NIL Rate of GST In Re: M/s Rahul Ramachandran (Inspire Academy) CITATION: 2022 TAXSCAN (AAR) 177

The Maharashtra Authority of Advance Ruling (AAR) has held that service provided by Educational Institutions to its students and staff attracts a Nil rate of GST. The Authority observed that the applicant provides services by way of pre-school education and as per 2(y)(i) of definition entry 66 of Notification No. 12/2017 the “Nashik Cambridge Pre-School”, can be considered as an ‘Educational Institution’. Since it is considered as an Educational Institution, services provided by it to its students and staff attract a Nil rate of GST.

Composite Supply of Works Contract not Covered under the Term ‘Earth Work’ In Re: M/s Mahalaxmi BT Patil Honai Constructions (JV) CITATION: 2022 TAXSCAN (AAR) 165

The Maharashtra Authority for Advance Ruling (AAR) has held that the composite supply of works contract is not covered under the term “Earth Work”. The Tribunal has observed that to fall under the Sr. No. 3A, the primary requirement is that the supply should be in the form of a composite supply of goods and service. But the impugned activity is a composite supply of works contract as defined in clause (119) of section 2 of the CGST Act. Being a composite supply of works contract the impugned activity cannot be covered under Sr. No. 3A.

GST applicable on total of the escalated Value plus the Original Value of Contract In Re: M/s B P Sangle Constructions Pvt Ltd CITATION: 2022 TAXSCAN (AAAR) 123

The Maharashtra Authority of Advance Ruling has held that GST is applicable on a total of the escalated value plus the original value of the contract. It was further observed by the authority that section 15(1) says that the value of supply of goods or services or both shall be the transaction value and the transaction value in the subject case will also include the escalating value, which is being recovered from NHAI by the applicant. Therefore such escalated value or price which is added to contract price shall be liable for payment of GST as per the provisions of section 15 of the Act.

Professional, Technical, and Business Services in Relation to Mining Operations Attract 18% GST  In Re: M/s. Worley services India Pvt Ltd CITATION:2022 TAXSCAN (AAR) 162

The Maharashtra Authority of Advance Ruling ( AAR ) has held that professional, technical, and business services in relation to mining operations attract 18% GST. The Coram of Sri Rajiv Magoo, Member (central Tax) and Sri T. R. Ramnani, Member (State Tax) has held that “the impugned services consist of professional, technical and business services, the same is not covered under Sr. No. 21 (ia) (SAC 9983) and Sr. No. 24 (SAC 9986) of Notification 11/2017 CT(R). Therefore the said professional, technical, and business services by the applicant to Vedanta Limited are clearly covered under the residue Entry No. 21(ii) of Notification 11/2017 CT(R) and attracting a tax rate of 18%”.

Design and Development of Patterns used for Manufacturing of Camshafts is a Supply of Service In Re: M/s Precision Camshaft Limited CITATION:2022 TAXSCAN (AAR) 132

The Maharashtra Authority of Advance Ruling (AAR) has held that the design and development of patterns used for manufacturing camshafts is a supply of service. The Coram of Sri Rajiv Magoo, Member Central Tax and Sri T. R. Ramnani, Member State Tax has held that “the activity of design and development of patterns used for manufacturing of camshafts, for a customer is a supply of service in the form of intermediary services”.

Transfer of Land held under Lease is a Supply and Liable to GST In Re: M/s Forest Development Corporation Of Maharashtra Limited CITATION: 2022 TAXSCAN (AAR) 107

The Maharashtra Authority for Advance Ruling (AAR) has held that the transfer of land held under lease is a supply and liable to GST. he Coram Sri Rajiv Magoo, Member Central Tax and Sri T.R. Ramnani, Member State Tax held that “As per 5 (e) of Schedule II of the CGST Act 2017, agreeing to the obligation to do an act amounts to supply of services. In the subject case, the applicant has agreed to do an act i.e. the applicant has agreed to relinquish its lease right on the said land in favour of Irrigation Department on the directions of the owner of the land i.e. MSFR Department. Thus the said action of the applicant is nothing but supply of services under the GST Laws and the said supply is to MSFR department for which compensation is received from the Irrigation department”.

Supply of Security Services to Municipal Corporations Exempted from GST In Re: M/s Maharashtra Ex-Servicemen Corporation Ltd CITATION: 2022 TAXSCAN (AAR) 108

The Maharashtra Authority of Advance Ruling (AAR) has held that supply of Security Services to Municipal Corporations under Article 243 W is exempted from GST. The division bench presided by Sri Rajiv Magoo, Member Central Tax and Sri T. R. Ramnani, Member State Tax held that “we are of the opinion that, that the applicant will be entitled to the benefit of Notification No 12/2007-CT(Rate) in respect of the impugned activity only if the same is provided in relation to functions which have been entrusted to a Municipality under Article 243W of the Constitution. If the impugned activity/services are not provided in relation to functions that have been entrusted to a Municipality under Article 243 W of the Constitution, then in such a case the applicant will not be entitled to exemption under Sr. No 3 of Exemption Notification No. 12/2017 — Central Tax (Rate)”

18% GST applicable on Poultry Crates, Can be Treated as Article for Conveyance or Packing of Goods, of Plastics  In Re: M/s Nilkamal Ltd CITATION: 2022 TAXSCAN (AAR) 109

The Maharashtra bench of the Authority for Advance Rulings (AAR) has held that 18% GST on Poultry Crates can be treated as articles for conveyance or packing of goods, or plastics. The bench comprises Sri Rajiv Mangoo, Member, Central Tax, and Sri T. R. Ramnani, Member, State Tax held that “the impugned product i.e. the poultry crates is an article of plastic. It is used for the conveyance of poultry and from a reading Chapter 39, it is clear that the said product is clearly covered under sub-section 392310 of the Tariff. However, it is seen that the subject product does not fall under 39231010; 39231020; and 39231040. Thus, the impugned product will be covered under the residual i.e. 39231090 of the Tariff and hence attract GST of 9%”.

GST: Road Tunnelling Work by Way of Drill and Blast Technique is a Composite Supply, rules AAR  In Re: M/s Kapil Sons CITATION: 2022 TAXSCAN (AAR) 126

The Maharashtra Authority of Advance Ruling (AAR) has ruled that road tunnelling work by way of drill and blast technique is a composite supply. The coram of  Rajiv Magoo and T.R.Ramnani has ruled that the main contractor has been given a contract by MSRDC to construct tunnels for Mumbai Pune Expressway and accordingly, the main contractor has subcontracted the tunnelling work to the applicant by way of drill and blast technique of tunnelling. 

18% GST payable on Construction of Buildings and Civil Structures necessary to House Data Centres, Nearline Data Centres, Disaster Recovery Station, Satellite Data Centre In Re: M/s Sterlite Technologies Limited CITATION: 2022 TAXSCAN (AAR) 127

The Maharashtra Authority of Advance Ruling (AAR) has ruled that 18% GST payable on Construction of buildings and civil structures necessary to house data centres, nearline data centres, disaster recovery station, satellite data centre. The coram of Rajiv Mangoo and T.R.Ramnani has held that activities of the applicant were covered under entry 3(ii) of the Notification No 11/2017 CGST (Rate) dated June 28, 2017 and thereafter with effect from 01.04.2019, the said activities are covered under Sr. No. 3 (xii) as amended by Notification No 03/2019 CGST (Rate) dated 29th March, 2019, taxable at the rate of 18%.

18% GST payable on Smile Fixing Treatment, Teeth Whitening In Re: M/s Jyoti Ceramic Industries CITATION: 2022 TAXSCAN (AAR) 128

The Maharashtra Authority of Advance Ruling (AAR) has ruled that 18% GST payable on Smile Fixing Treatment, teeth whitening. The applicant has sought the advance ruling on the issue Whether health care services namely bleaching of teeth and dental veneers for smile designing provided by dental clinic of Applicant to its patients falls under Chapter Heading 999312 at Nil rate of GST or Chapter Heading 999722 at 18% GST? The coram of Rajiv Magoo and T.R. Ramnani held that the services of bleaching of teeth and dental veneers for smile designing provided by dental clinic of Applicant to its patients falls under Chapter Heading 999722 at 18% GST.

ITC available on GST paid under RCM on Hiring of Buses for Transportation of Employees In Re: M/s Maanicare System India Private Limited CITATION:2022 TAXSCAN (AAR) 135

The Maharashtra Authority of Advance Ruling (AAR) has ruled that Input Tax Credit (ITC) is available on GST paid under RCM on hiring of buses for transportation of employees. The coram of Rajiv Mango and T.R.Ramnani has held that Section 17 (5) had clearly debarred Input Tax Credit on motor vehicles or conveyances used in transport of passengers till the date of the amendment i.e. 01.02.2019. However with effect from 01.02.2019, Input Tax Credit has been allowed on leasing, renting or hiring of motor vehicles, for transportation of persons, having approved seating capacity of more than thirteen persons (including the driver).

No GST payable on Comprehensive Architectural Services In Re:M/s Sir JJ College of Architecture Consultancy Cell CITATION: 2022 TAXSCAN (AAR) 136

The Maharashtra Authority of Advance Ruling (AAR) has held that no Goods and Service Tax is payable on Comprehensive architectural services. The Coram of Rajiv Magoo and T.R. Ramnani has held that GST exemption vide Sr. No. 3 of Notification No. 12/2017 – Central Tax (Rate) dated 28th June 2017, is applicable on Comprehensive architectural services that includes architectural design, structural design, MEP design , HVAC services design, preparation of drawings etc for repairs/ restoration, reconstruction for development of recreation ground cum textile museum at United India Mills 2 & 3 at Kala chowky provided by the Applicant to Municipal Corporation of Greater Mumbai (MCGM).

GST payable on Membership Fee collected from Members of the Club In Re: M/s Poona Club Limited CITATION: 2022 TAXSCAN (AAR) 137

The Maharashtra Authority of Advance Ruling (AAR) has held that GST Payable on Membership Fee collected from Members of the Club. The coram of Rajiv Mangoo and T.R.Ramnani has held that membership fee collected from members at the time of giving membership is liable to tax under CGST/SGST Act. The AAR has ruled that  the annual subscription and annual games fee collected from members of the club is liable to tax under CGST/SGST Act.

18% GST on Supply of Reverse Osmosis Plant/system (RO Plant/system) to Indian Navy/Indian Coast Guard in Normal Course In Re: M/s Rochem Separation Systems India Private Limited CITATION: 2022 TAXSCAN (AAR) 138

The Maharashtra Authority of Advance Ruling (AAR) has ruled that the 18% GST on supply of Reverse Osmosis Plant/system (RO Plant/system) to Indian Navy/Indian Coast Guard in normal course. The AAR ruled that 18% GST is applicable on supply of Reverse Osmosis Plant/system (RO Plant/system) to Indian Navy/Indian Coast Guard in normal course and on supply of RO Plant/system (Reverse Osmosis Plant) to the Indian Navy/Coast Guard which would be installed in/on a warship. The coram of Rajiv Magoo and T.R.Ramnani noted that the R.O. Plant/system is to be installed on warships for the purpose of purifying water. It does not contribute to the functionality of the warship.

No GST payable on Services of providing of Artificial Teeth, Crown, Bridges falls only when the same are provided as Health Care  In Re: M/s Jyoti Ceramic Industries CITATION:   2022 TAXSCAN (AAR) 144

The Maharashtra Authority of Advance Ruling (AAR) held that no Goods and Service Tax (GST) payable on Services of providing of Artificial Teeth, Crown, Bridges falls only when the same are provided as Health care. The Authority held that the services of bleaching of teeth and dental veneers for smile designing provided by dental clinic of Applicant to its patients falls under Chapter Heading 999722 at 18% GST. The coram of Rajiv Magoo and T.R. Ramnani held that the Product namely “Zirconium Oxide Ceramic Dental Blanks in different sizes as sold by Applicant are classifiable under Chapter Heading 69091200.

No GST payable on Recoveries made from Employees towards providing Parental Insurance In Re: M/s Syngenta India Limited CITATION: 2022 TAXSCAN (AAR) 145

The Maharashtra Authority of Advance Ruling (AAR) no GST payable on recoveries made from employees towards providing parental insurance. The coram of Rajiv Mangoo and T.R.Ramanani held that recovery of notice pay from dues of employee / payment of notice pay by the employee who could not serve the notice for the period as per contractual agreement or appointment letter does not amount to supply and therefore as per Section 7 (1A) of the CGST Act, 2017, the provisions of Schedule II does not come into play.

GST not Payable on Recoveries made from Employees towards providing Canteen Facility at Subsidized Rates in Factory and Office In Re:M/s Emcure Pharmaceuticals Limited CITATION: 2022 TAXSCAN (AAR) 155

The Maharashtra Authority of Advance Ruling (AAR) has ruled that the GST is not payable on recoveries made from employees towards providing canteen facility at subsidized rates in factory and office. The Coram of Rajiv Mangoo and T.R.Ramnani noted that the employee opting to resign by paying an amount equivalent to a month of salary in lieu of notice, has acted in accordance with the contract and that being the case no question of any forbearance or tolerance does arise. Further, as per the agreement, the resignation by the employee is not subject to any acceptance or approval and the employee is free to tender his resignation, make payment of notice period salary to leave.

ITC available on 12% GST paid on Supplying, Operating, and Maintaining Air-Conditioned Electrically operated Buses  In Re: M/s MH Ecolife E-Mobility Pvt Ltd CITATION:   2021 TAXSCAN (AAR) 101

The Maharashtra Authority of Advance Ruling (AAR) held that Input Tax Credit (ITC) available on 12% GST paid on supplying, operating and maintaining air-conditioned electrically operated buses. The coram of Rajiv Magoo and T.R.Ramnani held that  services provided by the applicant to NMMT under the Agreement, by way of supplying, operating and maintaining air-conditioned electrically operated buses the appropriate SAC (Services Accounting Code) for classifying the services provided by the applicant is Tariff Heading 9966. The rate of GST is 12% (with availment of ITC) or 5% (without availment of ITC).

5% GST payable on Dried and Polished Turmeric  In Re: M/s NITIN BAPUSAHEB PATIL CITATION: 2021 TAXSCAN (AAR) 102

The Maharashtra Authority of Advance Ruling (AAR) held that 5% GST payable on Dried and Polished Turmeric. The coram of Rajiv Magoo and T.R.Ramnani held that dried and polished Turmeric as in the instant case, is not covered under the definition of ‘Agriculture Produce and is not exempted from GST. The HSN code of the impugned product is 0910 30 20 and the rate of GST is 5% (2.5% each of CGST and SGST).

GST payable on Electricity Charges and Water Charges as per meter reading and collected from Recipients at Actual on Reimbursement basis  In Re: M/s Indiana Engineering Works(Bombay)Pvt. Ltd CITATION: 2021 TAXSCAN (AAR) 108

The Maharashtra Authority of Advance Ruling (AAR) held that GST payable on  Electricity charges and Water charges as per meter reading and collected from the recipients was actual on reimbursement basis. The coram of Rajiv Magoo and T.R.Ramnani ruled that renting of immovable property would be the main supply and the provision of other utilities such as electricity, and water supply, fuel etc. would be in the nature of ancillary supply which help in better enjoyment of the main supply. Therefore, the utility charges in the nature of electricity charges and water reimbursed to the applicant by the lessee forms a part of the value of supply.

Part recovery of ‘Renting of Motor Vehicles Services’ or ‘Cab Services’ from Employees on Transport facility provided to them is not ‘Supply’  In Re: M/s Intergrated Decisions And Systems India Pvt Ltd CITATION: 2021 TAXSCAN (AAR) 109

The Maharashtra Authority of Advance Ruling (AAR) held that part of the recovery of ‘renting of motor vehicles services’ or ‘cab services’ from employees in respect of the transport facility provided to them is not ‘supply’. The coram of Rajiv Magoo and T.R.Ramnani ruled that the GST is discharged on the gross value of bills raised on the applicant by the third party vendors. We also observe that the partial amounts recovered by the applicant from its employees in respect of use of such transport facilities are a part of the amount paid to the third party vendors which have already suffered GST.

28% GST on Manufacturing and Supplying of CNG Dispenser In Re: M/s Parker Hannifin India Private Limited CITATION: 2021 TAXSCAN (AAR) 113

The Maharashtra Authority of Advance Ruling (AAR) held that 28% GST on manufacturing and supplying of CNG Dispenser. The Coram of Rajiv Magoo and T.R.Ramnani Since we have found that the impugned product is covered under Chapter Heading 8413 11 of the GST Tariff, it is not covered under SL. No. 422, Schedule III of Notification No. 1/2017-Central Tax (Rate) dated 2 June 2017 as amended as the impugned product cannot be classified under Chapter 90.32.

GST under RCM payable on Procurement of Renting of Immovable Property Services from SEZs  In Re: M/s Portescap India Private Limited CITATION: 2021 TAXSCAN (AAR) 121

The Maharashtra Authority of Advance Ruling (AAR) held that GST under reverse charge mechanism payable on procurement of renting of immovable property services from Special Economic Zones (SEZs). The coram of Rajiv Magoo and T.R.Ramnani held that tax is payable, by the applicant, under reverse charge mechanism on procurement of domestic services like renting of immovable property services from SEEPZ SEZ Authority in accordance with Notification No. 13/2017 – C.T. (Rate) & 03/2018-C.T. (Rate) dated 25.01.2018.

12% GST to be charged by Sub-Contractor to main Contractor on Work Contract Services on Construction of Roads In Re: M/s Core Construction CITATION:   2021 TAXSCAN (AAR) 123

The Maharashtra Authority of Advance Ruling (AAR) ruled that 12% GST be charged by the sub-contractor to the main contractor on Work Contract Services on Construction of Roads.The Coram of Rajiv Magoo and T.R.Ramnani held that in respect of Sub-Contract awarded to the applicant by M/s J. P. Enterprises (main contractor), to whom Aurangabad Municipal Corporation awarded the contract for Executing Work of construction of Concrete Roads in Aurangabad City Packages P-2, the rate to be charged is 6% SGST plus 6% CGST, total 12%.

Contributions from Members, recovered for Spending on Weekly Meetings, Other Petty Administrative Expenses amounts to ‘Supply’ In Re: M/s Rotary Club of Mumbai Elegant CITATION: 2021 TAXSCAN (AAR) 128

The Maharashtra Authority of Advance Ruling (AAR) held that Contributions from members, recovered for spending on weekly meetings, other petty administrative expenses amounts to ‘supply’. The coram of Rajiv Magoo and T.R.Ramnani ruled that the activity of the applicant i.e. collecting contributions and pending towards meeting and administrative expenditures only, is business as envisaged u/s 2(17) of the CGST Act, 2017.

18% GST applicable on Activity of Surface Coating on Old, Worn out or used Goods received from Customers

The Maharashtra Authority of Advance Ruling (AAR) held that 18% GST applicable on  activity of surface coating on old, worn out or used goods received from Customers. The coram of Rajiv Magoo and T.R.Ramnani ruled that the activity of surface coating undertaken by the Applicant on original/new goods received from Customer (tool manufacturers and not end users) is classifiable under service accounting code 9988 more specifically under code 998898 as job work activity chargeable to tax at 12% in terms of entry no. 26(id) of Notification 11/2017 Central Tax (Rate) dated 28.06.2017, as amended.

5% GST payable on parts of Diesel Marine Engine or Genset supplied to Indian Navy

The Maharashtra Authority of Advance Ruling (AAR) held that 5% GST payable on parts of diesel marine engine or genset supplied to the Indian Navy. The coram of Rajiv Magoo and T.R.Ramnani ruled that  parts of diesel marine engine or genset supplied or to be supplied by the Applic to the Indian Navy are chargeable to 5% GST only if they are used in diesel marine engine or genset which are further used in ships and vessels falling under chapter headings 8902, 8904, 8905, 8906 and 8907 of the GST Tariff.

5% GST on Supply for Marine Engines used for Defense, Patrolling, Flood Relief, Rescue Operations  In Re: M/s OCEAN BLUE BOATING PRIVATE LIMITED CITATION:   2021 TAXSCAN (AAR) 136

The Maharashtra Authority of Advance Ruling (AAR) ruled that the 5% GST on Supply for marine Engines used for defense, patrolling, flood relief, and rescue operations. “Marine engine of heading 8407 and heading 8408, and parts thereof of heading 8409 will be covered under Sr. No. 252 of Notification No. 1/2017-C.T.(Rate), dated 28-6-2017, when used in fishing vessels falling under HSN 8902 of the GST Tariff, as in the subject case. Goods which do not conform to “parts of marine engines” will not be covered under the said Sr. No. 252 of Notification No. 1/2017-C.T.(Rate), dated 28-6-2017,” the AAR said.

No GST Exemption to Mahindra Splendour CHS If monthly Contribution exceeds Rs. 7,500 per month In Re: M/s Mahindra Splendour CHS Ltd CITATION: 2021 TAXSCAN (AAR) 143

The Maharashtra Authority of Advance Ruling (AAR) held that no GST Exemption to Mahindra Splendour CHS if monthly contribution exceeds Rs. 7,500 per month. The coarm of Rajiv Magoo and T.R.Ramnani held that the applicant is liable to pay GST on the contribution received from its members. In case the monthly contribution exceeds Rs. 7,500/- per month, then the GST is leviable on the entire value of the monthly contribution collected. The charges, collected by the society on account of property tax, electricity charges and other statutory levies would only be excluded while calculating the threshold limit of Rs. 7,500/-.

Amount collected as Membership Subscription, Admission Fees from Members by Rotary Club to meet Expenses to be considered as Supply of Services under GST In Re: M/s ROTATERY CLUB OF NAGAPUR VISION CITATION: 2021 TAXSCAN (AAR) 149

The Maharashtra Authority of Advance Ruling (AAR) ruled that the Amount collected as membership subscription, admission fees from members by Rotary Club to meet expenses to be considered as supply of services under GST. The coram of members Ranjiv Magoo and T.R.Ramnani noted that the applicant club and its members are distinct persons and the amounts/consideration received by the applicant from its members are nothing but consideration received for supply of goods/services as a separate entity.

Activity of Collecting Contributions, Spending towards Meeting and Administrative Expenditures only, is ‘Business’ under GST In Re: M/s ROTATERY CLUB OF BOMBAY QUEEN CITATION: 2021 TAXSCAN (AAR) 150

The Maharashtra Authority of Advance Ruling (AAR) ruled that the activity of collecting contributions, spending towards meeting, and administrative expenditures only, is ‘business’ under GST. The coram of members Ranjiv Magoo and T.R.Ramnani ruled that the activity of the applicant i.e. collecting contributions and spending towards meeting and administrative expenditures only, is ‘business’ as envisaged u/s 2(17) of the CGST Act, 2017.

18% GST payable on Nominal Charges received from Patients towards an “Unparallel Health Insurance Scheme” for the purpose of Imparting Medical Education  In Re: M/s KASTURBA HEALTH SOCIETY CITATION: 2021 TAXSCAN (AAR) 155

The Maharashtra Authority of Advance Ruling (AAR) ruled that 18% GST is payable on nominal charges received from patients towards an “Unparallel Health Insurance Scheme”. The coram of Rajiv Magoo and T.R.Ramnani ruled that  a Charitable Society having the main object and factually engaged in imparting medical education, satisfying all the criteria of “Educational Institution” is liable for registration under the provisions of section 22 of the Central Goods and Service Tax Act, 2017 and Maharashtra Goods and Service Tax Act, 2017.

No GST payable on Reimbursement of Expenses such as Salaries, Rent, Training, Staff Welfare Expenses by Maha Mumbai Metro In Re: M/s MAHA MUMBAI METRO (M3) OPERATION CORPORATION LIMITED CITATION: 2021 TAXSCAN (AAR) 156

The Maharashtra Authority of Advance Ruling (AAR) ruled that no GST payable on reimbursement of expenses such as salaries, rent, training, staff welfare expenses by Maha Mumbai Metro. The coram of Rajiv Magoo and T.R.Ramnani he impugned pure services supplied by the applicant can be covered under clause 1, of the Twelfth Schedule above, pertaining to Articles 243W of the Constitution, “by way of any activity in relation to any function entrusted to a Municipality under article 243W of the Constitution”.

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