Appellate Orders

We modify the order No. KAR ADRG 06/2022 dated 8th March 2022 passed by the Advance Ruling Authority as follows:

The question "Whether ITC can be claimed on common services which are utilized for both taxable as well as exempted supplies?" is admissible for advance ruling as it falls within the scope of Section 97(2)(d) of the CGSST Act.

We uphold the findings of the Authority for Advance Ruling with respect to questios 2 and 3 of their application and hold that they are not questions on which an advance ruling can be given.

The appeal filed by the Appellant, M/s Bharatiya Reserve Bank Note Mudran Pvt Ltd, is disposed off on the above terms.

Order No. UP ADGR-84/2021 dated 18.10.2021 issued by the Authority for Advance Ruling is upheld by the Appellate Authority.

(a) Activity of providing free complimentary tickets does not fall within the domain of supply as it does not have the element of consideration. However, where such complimentary tickets are being provided by the appellant to a related person or a distinct person the same shall fall within the ambit of supply on account of Schedule I of the Act and the appellant would be liable to pay tax on the same;

(b) The appellant would not be eligible to avail input tax credit in relation to such activity. But, where such activity or transaction is treated as supply on account of being provided by the appellant to a related person or a distinct person the appellant would be entitled to avail input tax credit for the same.

The Maharashtra Appellate Authority for Advance Ruling, modified the Ruling passed by the MAAR vide order No. GST-ARA-35/2019-20/B-14 dated 24.05.2021, by holding that the host of activities performed by the Appellant at the behest of their Dubai Head Office will come under the ambit of "Supply" in terms of Section 7(1)(a) of the CGST Act, 2017, and are required to take GST registration, and discharge their IGST liability, if any, on the amount received from their Dubai Head Office. Thus, the Appeal filed by the Appellant is not maintainable, and hence hereby, dismissed.

The Maharashtra Appellate Authority for Advance Ruling, set aside the impugned MAAR order dated 22.12.2021 and answered the questions raised by the Appellant as under:

(i) the Turmeric (Turmeric in Whole form - not in powder form) is covered under the definition of 'Agricultural Produce'. The HSN code of Turmeric is 0910 30 20 and the rate of GST is 5% (CGST @ 2.5%+ SGST@ 2.5%). However, the first supply of Turmeric (Turmeric in Whole form - not in powder from) by farmers, being supply by non-taxable person in Agricultural Produce and Marketing Committee, is not liable to GST by virtue of provisions of section 23 (1) (b) and 2 (107) of the CGST Act, 2017.

(ii) Services rendered by the Appellant as a Commission Agent in APMC, Sangli, are not liable to GST in terms of Sl. 54 Heading 9986 of Notification No.12/2017 CT(R) dated 28.06.2017 read with Sl. No. 24 of Notification No.11/2017-C.T. (Rate) dated 28.06.2017.

(iii) The Appellant is required to be registered in terms of the provisions of Section 22(1) of the CGST Act, 2017.

Whether the supply of Occupational Health Check-up (OHC) service by the hospital i.e. nursing staff, Doctors, Paramedical staff on hospital’s payroll, working in different corporate for providing health check-up service, ambulance facility, and allied medical services to their employees and also the camps conducted for health check-up outside the hospitals, to be treated as Health Care service and hence not taxable under CGST / SGST?

Whether the applicant is eligible to claim exemption benefit under Sr.No.5 and Sr. No. 66(a) & (aa) of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017.

“Whether various activities carried out by the appellant to the plot holders in terms of provisions of GIDC Act, 1962 and charges collected for the same as may be notified from time to time amounts to supply under Section 7 of the CGST Act, 2017”.

1. Whether in terms of Section 17 of the CGST Act, 2017 read with GGST Act, 2017, the LNG jetties proposed to be built by the applicant can be said to be covered within expression ‘plant and machinery’ as foundation to equipment, apparatus, machinery to be installed on it?

2. Whether as per Section 16 read with Section 17 of the said Acts, the applicant can accordingly avail ‘input tax credit’ of GST paid on inputs, input services as well as capital goods procured for the purpose of building the LNG jetties?

In view of the above, the taxability of Custom milling of Rice provided to the Central Government, State Government or Union territory or local authority or a Governmental authority or a Government Entity by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution will be strictly governed by circular No. 153/09/2021-GST dated 17.06.2021 issued by the Government of India, Ministry of Finance, Department of Revenue as under:

Public Distribution specifically figures at entry 28 of the 11th Schedule to the constitution, which lists the activities that may be entrusted to a Panchayat under Article 243G of the Constitution. Hence, said entry No. 3A of Notification No.12/2017- Central Tax (Rate) dated 28-06-2017 would apply to composite supply of milling of paddy into rice, provided that the value of goods supplied in such composite supply does not exceed 25% of the value of composite supply. Whether the value of goods in such composite supply is up to 25% or not is a matter of fact and requires ascertainment on case-to-case basis.

In case the supply of service by way of milling of paddy into rice, is not eligible for exemption under SI.No. 3A of Notification No.12/2017- Central Tax (Rate) dated 28-06-2017 for the reason that value of goods supply in such a composite supply exceeds 25%, then the applicable GST rate would be 5% if such composite supply is provided to a registered person, being a job work service (entry No.26 of notification No.11/2017- Central Tax (Rate) dated 28.06.2017.

Jurisdictional Tax authorities will verify the above on case to case basis.