14
Disclaimer:
This publication contains information for general guidance only. It is not intended to address the
circumstances of any particular individual or entity. Although the best of endeavour has been made to
provide the provisions in a simpler and accurate form, there is no substitute to detailed research with
regard to the specific situation of a particular individual or entity. We do not accept any responsibility for
loss incurred by any person for acting or refraining to act as a result of any matter in this publication.
About Vayana Network and SahiGST:
SahiGST was founded by a group of entrepreneurs with immense experience in domains of Taxation and
Technology. SahiGST is now a portfolio offering of Vayana Network – an authorized GSP and India’s
largest 3rd party platform for Short Term Trade Finance. Visit www.vayana.com to learn more.
Case Laws
GST Revenue collection for September, 2019
INR 91,916 crore total gross GST revenue collected inthe month of September, 2019
Issuance of 43 notifications by CBIC on 30th
September 2019
� The Central Board of Indirect taxes and Customs (CBIC) has
issued 43 notifications on 30th September 2019 to give
effect to recommendations made by GST Council in its 37th
meeting;
� Most of the changes are effective from 1st October 2019;
Procedure to claim refund in FORM GST RFD-01 subsequent to favourable order in appeal or any other forum –
regarding
Eligibility to File a Refund Application in FORM GST RFD-01 for a Period and Category
Confederation of All India Traders (CAIT) says e-
commerce portals avoiding GST during festival
sales; seeks probe
GST Sahaj, Sugam: Not simple for claiming
tax credit
� Small GST payers are discovering that the proposed GST
forms - Sahaj and Sugam, may create a new pain point in
obtaining input tax credit (credit for taxes paid on inputs
used).
� As of now, GST payers are grappling with the inability to
rectify GSTR-1, it remains to be seen whether this
problem will continue in the proposed forms.
� The annual GST return (GSTR-9), in its current avatar is
seen as complex for small GST payers.
� As some temporary respite, the GST Council in its 37th
meeting held on September 20, has made it optional for
taxpayers having an aggregate turnover of Rs 2 crore or
less, to file the annual returns for the financial year
2017-18 & 2018-19.
� For the current financial year, no such option is available.
� At present, the GST rules specify one format of returns
for all taxpayers.
� Currently the process of availing input tax credit (ITC) is
not linked with the uploading of invoices done by
suppliers.
� Going forward, taxpayers, opting for Sahaj and Sugam
returns will not be allowed to take ITC on missing
invoices (which are invoices that have not been
uploaded by their suppliers). However, they do have an
option to opt for filing of the regular quarterly return
form, which permits ITC on missing invoices.
� Taxpayers having supplies through e-commerce
platforms or zero-rated supplies, or those importing
goods from outside India on which ITC is to be availed,
also cannot opt for the Sahaj and Sugam forms.
� Traders body CAIT on Sunday 29th
Sep 2019 alleged that e-
commerce portals during the festive sales are causing huge loss of
revenue to the government by levying GST on the discounted price
rather than on the actual market price of the commodity.
� The CAIT in a communication sent to Finance Minister Nirmala
Sitharaman on Sunday charged that the e-commerce companies
particularly Amazon and Flipkart through their festive sales are
depriving the government with huge amount of GST revenue, a
CAIT statement said.
� CAIT has urged the FM to order an investigation into the business
model of these companies.
� "Its irony that if a trader makes even a slight mistake during the
course of his business, he is subjected to several penalties and
even prosecution. However, these e-commerce companies which
are authorised to do only Business to Business (B2B) activities are
conducting Business to Consumers (B2C) sales right under the eyes
and nose of the government and no action has been taken so far
against them for such a blatant violation of FDI Policy," it said.
� CAIT National President B C Bhartia said during festive sales of e-
commerce companies a large number of commodities are being
sold at a much lesser price than the actual price thanks to deep
discounts from 10 to 80 per cent which is nothing but a "predatory
pricing".
� Moreover, the GST which is supposed to be charged on the actual
market price of the commodity in normal case is now being
charged on the price after deducting the discounts offered and this
is nothing but under pricing of the commodity by these e-
commerce portals thereby causing huge loss of GST revenue to the
government, he added.
Preferential location service, space for car parking not
part of construction services: West Bengal AAAR
Builder found guilty of not-passing ITC Benefit to
Customer
� Mr. Vivek Gupta Vs M/s Gurukripa Developers &
Infrastructures Pvt. Ltd. (National Anti-Profiteering
Authority)
� National Anti-Profiteering Authority (NAA) holds the
builder guilty of profiteering u/s 171(1) of CGST Act, 2017
to the tune of Rs. 3.69 crores (approx.) for not passing
benefit of additional ITC to the tune of 2.42% (4.48% -
2.06%) considering ratio of ITC to turnover post-GST and
pre-GST.
� It was realized more price from them than what he was
entitled to charge and has also compelled them to pay
more GST than what they were required to pay by issuing
incorrect tax invoices and hence he has committed
offence under section 122 (1) (i) of the CGST Act, 2017 and
therefore, he is liable for imposition of penalty under the
above Section read with Rule 133 (3) (d) of the CGST
Rules, 2017.
� Preferential location service (PLS) in a real-estate project
cannot be treated as a part of construction service, West
Bengal Appellate Authority for Advance Ruling (AAAR-WB)
has ruled. It also ruled that the same would hold good for
the right to use of parking space.
� PLS helps buyers get directional advantage or floor rise,
and attracts a preferred location charge (PLC) that is levied
for units that are better located than others in the same
premises, such as the ones facing a park, open area or
even corner flats.
� AAAR-WB heard an appeal by the State Tax Department against ruling by Authority for Advance Rulings (AAR) in the
matter of Bengal Peerless Housing Development Company Limited.
� The key issue was taxability of services relating to preferential location and right to use of car parking space.
� AAR, in its ruling, had said that the company is providing service of construction of a dwelling unit in a residential
complex, bundled with services relating to the preferential location of the unit and the right to use car parking space and
common areas and facilities. “It is a composite supply, construction service being the principal supply. Entire value of the
composite supply is, therefore, to be treated, for the purpose of taxation, as supply of construction service, taxable,” the
authority said in its ruling dated May 2.
� After hearing both sides on appeal petition, the AAAR held that
the very transaction mechanism of PLS is that the builder charges
a separate consideration from the buyer for choosing a particular
floor/location advantage. Thus, the abatement, which is allowed
on construction service with respect to land on which construction
is done, cannot be extended to PLS as it is altogether a separate
service having no association with land.
� The Applicant has the largest maritime services network in the world supplying a wide portfolio of maritime goods and
services. WMSPL has 3 major business activities known as: Maritime Products, Ships Agency and Maritime Logistics.
AAR FINDINGS & CONCLUSION:
� They have find that the imported procured goods are kept in Bonded/Non-Bonded
Warehouses. These goods are imported and import duty is paid on them. Once the
import duty is paid, it would imply that the said goods has been received & cleared by
the applicant and are in taxable territory.
� Schedule III of the CGST Act, 2017, as amended is reproduced as: Activities or
Transaction which shall be treated neither as a supply of Goods nor a supply of
services. Clause 8
i. Supply of warehoused goods to any person before clearance for home
consumption.
ii. Supply of goods by the consignee to any other person, by endorsement of
documents of title of goods, after the goods have been dispatched from the port of
origin located outside India but before clearance for home consumption.
In the subject case the supply of warehoused goods is of 2 types, namely:
� Clearance from Bonded Warehouses to the vessels and
� Clearance from non Bonded warehouses to the vessels.
GST ADVANCE RULING ON “MARITIME SERVICES”
- - Wilhelmsen Maritime Services Pvt. Ltd
Rulings sought on following matters:
1. Whether the delivery of goods to the owner of the ship
proceeding to foreign port at the Indian port is an “export
of goods” as per section 16 of the IGST Act, 2017???
2. WMSPL has w.e.f 01.07.2017 levied and paid GST under
protest on all its “Maritime Products” supplies. If the supply
is exports as per section 16 then, Will WMSPL will be liable
to claim refund for zero rated supply i.e. exports???
3. . If at all taxable, whether the tax will be levied as intra
state or interstate supply???
� A Bonded warehouse is a customs- Controlled warehouse for the retention of imported goods until the duty owed is paid. A
bonded warehouse is a secured area in which dutiable goods may be stored, without payment of duty. It may be manage by
the state or by the private enterprise.
� Upon the entry of goods into the warehouse, the importer and warehouse proprietor incur a liability under a bond which is
generally cancelled when the goods are: exported or deemed exported: withdrawn for supplies to a vessel or aircraft;
destroyed under customs supervision;or withdrawn for consumption domestically after payment of duty.
� Therefore, AAR of opinion that present supply in such case will fall under S-III of CGST Act and would cover the situation 1
above.
� However, AAR find that in situation mentioned at 2 above, the imported goods would have been cleared to such non
bonded warehouses on payment of appropriate IGST/customs duty and therefore AAR is of opinion that the supply in such
case as in 2 above will not fall under S III.
� Whether the transaction considered effected in the present case as export is not coveredunder the purview of Section 97 of
the CGST Act, 2017.
� In view of above discussion, supply from Bonded warehouse will fall under S III and exempted from GST and supply from
Non Bonded warehouse will not fall under S III and therefore not exempt under GST.
� The Applicant submits that the Government of Tamilnadu, Water Resource Department, is implementing a project
namely, 'Climate Adaptation in Vennar Sub-basin in Cauvery Delta' with fund from the Asia Development Bank (ADB).
lt has engaged him as a Financial Management Specialist to look after the financial management of the project fund'
The project aims at improving the flood risk management and upgrading the irrigation infrastructure in the delta area.
The civil work involves re-sectioning and strengthening the embankments of the six main channels and improving their
resilience and flood conveyance capacity. lt also includes upgrading minor irrigation and drainage structures.
� The Applicant submits that the Government of Mizoram, Public Works Department, is implementing under the
Regional Transport Connectivity Project (hereinafter RTCP) road sector modernization and performance enhancement
through institutional strengthening. lt is part of the Road Sector Modernization Plan (hereinafter RSMP), which carries
forward and deepens various institutional development initiatives in the road sector. The Applicant, as institutional
Development Specialist, handles implementation of the RSMP.
� The Applicant argues that he is supplying services to the State Governments that involve no supply of goods. The
services are in relation to such functions as irrigation, water management and watershed development in Tamilnadu,
and development of roads and bridges in Mizoram.
� These are functions listed under the 11th & 12th Schedules of the Constitution. The services he supplies are, therefore,
eligible for exemption under SI No. 3 of the Exemption Notification.
� The Applicant is providing pure service to the State Governments in relation to the projects described. The projects
involve functions entrusted to Panchayat or a Municipality under Art 243G or 243W of the Constitution. The
Applicant's service to the State Governments is, therefore, eligible for exemption under SL No. 3 of Notification No
9/2017- dated 28.06.2017.
� The Applicant has entered into contracts with the
Government of Tamilnadu and the Government of
Mizoram for providing services as a Financial Management
Specialist and institutional Development Specialist,
respectively. Lt seeks a ruling on whether exemption in
terms of SL No. 3 of Notification No 9/2O17-IGST(Rate)
dated 28.06.2017, (hereinafter referred to as "the
Exemption Notification"), is available on such services.
ADVANCE RULING ON “ROAD CONSTRUCTION & IRRIGATION”- Sumitabha Ray
Compliance calendar for the Month of October 2019
For further information, visit us at www.SahiGST .com
For any queries related to the product, write to us at
Call us for support on +91-9773-801-802
