"16 March 2019" Archive

Quickly understanding new GST Return formats effective from 01.04.2019

Goods and Services Tax (GST) is a technology oriented tax with a focus to plug revenue leakages. There had been major changes in the procedures like returns, assessments amongst others since the new law had been enforced....

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Defaults in Vendor payment obligations backfires in GST regime

In this article we shall analyse how availment of input tax credit without discharging vendor payment obligation and non-discharge of GST obligation on payments made to unregistered vendors backfires in GST regime....

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GST Advance ruling cannot be given on transaction prior to date of Application for Advance Ruling

In re KEI Industries Limited (GST AAAR Rajasthan)

In re KEI Industries Limited (GST AAAR Rajasthan) As the question posed by the party is related to the supplies undertaken by him, prior to the date of filing of the Application for Advance Ruling, so no ruling is given on the question . Also Read AAR Ruling- Electric cables cannot be treated as accessories […]...

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Annuity paid instead of toll charges to developers is exempt from GST

In re Ms Nagaur Mukundgarh Highways Pvt. Ltd. (GST AAAR Rajasthan)

In re Ms Nagaur Mukundgarh Highways Pvt. Ltd. (GST AAAR Rajasthan) Annuity payment is exempted from GST  in terms of Entry No. 23A of the Notification No.12/2017-Central Tax (Rate) Dt. 28.6.2017. However only 50% ITC of GST paid on Input & Input services used in the construction phase, is available. Full ITC of the GST […]...

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Supply to Director of Education (S & HS) qualifies for GST exemption

In re IL&FS Education and Technology Services Ltd. (GST AAAR Maharashtra)

In re IL & FS Education and Technology Services Ltd. (GST AAAR Maharashtra) The Appellate Authority for Advance Ruling set aside the ruling given by the Advance Ruling Authority by holding that  the supply of goods and services by the Appellant to the Director of Education (S & HS) qualifies for exemption in term of […]...

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AIS, NAVTEX & amp; SART are covered by Notification No. 1/2017-C.T. (Rate)

In re A.S. Moloobhoy Pvt. Ltd. (GST AAAR Maharastra)

In re A.S. Moloobhoy Pvt. Ltd. (GST AAAR Maharastra) The Appellate Authority for Advance Ruling modify the ruling given by the Advance Ruling Authority by observing that Automatic Identification System (AIS), NAVTEX, and SART are covered by Sr. 252 of Notification No. 1/2017 -C.T. (Rate). Also Read AAR Ruling- GST Rate on GPS, Echo Sounde...

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Turnkey EPC Project for Solar Plant comes under Works Contract,18% GST payable

In re RFE Solar Private Limited (GST AAAR Rajasthan)

In re RFE Solar Private Limited (GST AAAR Rajasthan) AAAR held that Turnkey EPC contract is a ‘composite supply’ under section 2(30) of the CGST Act, 2017.The said composite supply falls within the definition of Works contract under section 2(119) of the CGST Act, 2017 (SAC9954) and attracts 18% rate of tax (either 9% each [&h...

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TDS under section 31 of MVAT Act after 1st July, 2017

Trade Circular No. 10T of 2019 (16/03/2019)

Certain queries have been received by this office seeking clarification with regards to applicability of TDS under MVAT Act after 1st July, 2017. The amended provisions are explained as follows:a) An employer should have deducted tax (TDS), in respect of a works contract, executed upto 30th June 2017, even if the amount is payable after 3...

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GST payable on mechanical cleaning of Saunf (Fennel), Dhaniya (Coriander), Jeera (Cumin seeds)

In re Ms Rara Udhyog (GST AAAR Rajasthan)

In re Ms Rara Udhyog (GST AAAR Rajasthan) A process must satisfy all the three conditions before being declared as the process exempted from GST vide the  entries Nos. 24(i)(i)(c)and 54( c) ibid under the above notifications Nos. 11/2017-Central Tax (Rate) and 12/2017-Central Tax (Rate). Coming to the first condition, we find that the im...

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R.B. Construction Company not entitled to avail Transitional input tax credit: AAAR

In re Ms. R.B. Construction Company (GST AAAR Gujarat)

In re Ms. R.B. Construction Company (GST AAAR Gujarat) M/s. R.B. Construction Co.  is not entitled, under sub-sections (3) and (6) of Section 140 of the CGST Act, 2017 and the GGST Act, 2017 to avail input tax credit. In respect of that part of supply made by M/s. R.B. Construction Co., wherein time of […]...

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No GST on Delayed electricity Payment charges: AAAR

In re M/s TP Ajmer Distribution Limited (GST AAAR Rajasthan)

In re M/s TP Ajmer Distribution Limited (GST AAAR Rajasthan) AAAR held that no GST is chargeable on the delayed payment charges collected from the consumers for delay in payment of consideration for supply of electricity. While GST is chargeable on the cheque dishonor charges collected ( by whatever name) from the consumers. Also Read [&h...

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No GST on supply of Cold storage services for Agriculture Produce: AAAR

In re Sardar Mal Cold Storage & Ice Factory (GST AAAR Rajasthan)

In re Sardar Mal Cold Storage & Ice Factory (GST AAAR Rajasthan) The Appellant had submitted a list of various products categorised from Group A to Group C and the process done on those agriculture commodities before they come into cold storage in order to seek advance ruling that whether the goods which comes for […]...

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GST on interest on short term loan given by Del Credere Agent to buyers

In re M/s. Shreenath Polyplast Pvt. Ltd. (GST AAAR Gujarat)

Whether an amount charged as interest on transaction based short term loan given by the Del Credere Agent (DCA) to buyers of material is exempt from tax in terms of the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 (Serial Number 27) ?...

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GST payable on interest charged by Del Credere Agent from customers: AAAR

In re M/s. Shreenath Polyplast Pvt. Ltd. (GST AAAR Gujarat)

In re M/s. Shreenath Polyplast Pvt. Ltd. (GST AAAR Gujarat) The Del Credere Agent (DCA) makes payment to the principal in respect of goods supplied to the customer through him (DCA) in case of failure of making payment by the customer. Once the DCA makes the payment of goods to the principal on behalf of […]...

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Jewellery products containing watch classifiable under Heading 9101

In re M/s. House of Marigold (GST AAAR Gujarat)

In re M/s. House of Marigold (GST AAAR Gujarat) Gujarat Appellate Authority confirms the Advance Ruling given by Gujarat advance ruling authority and rejects the appeal filed by House of Marigold. The products ‘Marigold Butterfly Bridal’ with watch and similar jewellery products containing watch classifiable under Heading 9101. Also R...

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NCLT Has Jurisdiction Over Issues Related to Insolvency – Delhi HC

Liberty House Group Pte Ltd Vs State Bank of India & Ors. (Delhi High Court)

National Company Law Tribunal shall have jurisdiction to entertain or dispose of any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under the Code...

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Legal Fees paid for transfer of Shares allowable as deduction from LTCG

AIG Offshore Systems Services Inc. Vs ACIT (ITAT Mumbai)

Legal and professional fees paid in connection with the transfer of shares was allowable as deduction from long term capital gain under section 48(i) as the expenditure incurred was wholly and exclusively in connection with the transfer of shares of the Indian Subsidiary....

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Exemption U/s 54F allowable on capital gain on sale of depreciable assets

Shri Shrawankumar G. Jain Vs ITO (ITAT Ahmedabad)

Assessee was entitled to claim exemption under section 54F on gain earned on the sale of factory shed as factory shed inherently being long-term capital asset as per the provision of Section 2(42A) even if sale of factory shed was subject to short-term capital gain on the basis of deeming provision as specified under section 50. ...

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Redemption fine for infraction of law not allowable U/s 37

Pr. CIT Vs Sushil Gupta (Bombay High Court)

Assessee was not entitled to claim redemption fine as business expenditure under Section 37 as the same was for the infraction of law committed by assessee. ...

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Equality of Treatment at the Hands of Law is an Essential Attribute of Rule of Law: HC

Pr. CIT Vs M/s. Starflex Sealing India Pvt. Ltd. (Bombay High Court)

Pr. CIT Vs M/s. Starflex Sealing India Pvt. Ltd. (Bombay High Court) Held- Court requested revenue that the State takes a consistent view and does not agitate matters on which the Court has already taken a view, without pointing out the earlier order of this Court to the subsequent Bench. Court’s endeavor is only to […]...

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No Transfer U/s 2(47)(v) in Absence of Registration of Agreement Under Indian Registration Act

Principal CIT Vs Mr. Fardeen Khan (Bombay High Court)

Section 2(47)(v) – SC has held in Balbir case that transfer of any immovable property in part performance of a contract of the nature referred in section 53A of Transfer of Property Act will be completed only when the agreement is registered under Indian Registration Act. ...

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Subsequent Inquiry Based on Additional Material is Sustainable in Law

Kalsha Builders Pvt Ltd Vs ACIT (Bombay High Court)

Kalsha Builders Pvt Ltd Vs ACIT & Ors. (Bombay High Court) Subsequent Inquiry Based On Additional Material is Sustainable In Law  And Requirement Of True And Full Disclosure Runs Through The Entire Assessment And Doesn’t End With Filing Of Return.  FACTS – Assessee, a registered company, is engaged in the business of developing ...

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Meaning of “Associated Enterprises” for “Transfer Pricing” Provisions

Under Section 92A of the Income Tax Act, two enterprises are treated as Associated Enterprises only when one of the enterprises participates in “management, control or capital” of the other enterprise. Section 92A(1) of the Income-tax Act specifies that and “Associated Enterprise” in relation to another enterprise, means an enterp...

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Foreign Direct Investment – Who can invest in India

It is the intent and objective of the Government of India to attract and promote foreign direct investment in order to supplement domestic capital, technology and skills, for accelerated economic growth. Foreign Direct Investment, as distinguished from portfolio investment, has the connotation of establishing a “lasting interest‟ in a...

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Impact of changes in ITC utilisation on or after 1st Feb 2019

We have listed out all possible examples explaining impact of changes in ITC utilisation on or after 1st Feb 2019 with its possible proper explanation as new GST set off rules: Case 1 : Where supplier is engaged in making only Local Sale and Local Purchase and thus no IGST transaction. Impact : Since there […]...

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Composite supply Vs. Mixed Supply under Goods & Services Tax (GST)

Under GST ‘Mixed Supply‘ Means a combination of two or more goods or services made together for a single price. Each of these items can be supplied separately and is not dependent on any other. Under GST ‘Composite supply‘ means a supply comprising  two or more goods/services, which are naturally bundled and suppl...

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Significant Beneficial Ownership Rules- Applicability, Register & Returns

‘Significant beneficial owner’ means an individual referred to in sub-section (1) of section 90 (holding ultimate beneficial interest of not less than ten per cent.) read with sub-section [10] of section 89 of Companies Act, 2013, but whose name is not entered in the register of members of a company as the holder of such [&hel...

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Summary of SA 706 w.e.f. 01.04.2018.

Summary SA-706: Emphasis of Matter and Other Matter: Meaning of Emphasis of Matter: A Para included in the auditor report that That refers to a matter disclosed/presented in the financial statement that In the auditors judgment is of such importance that it is fundamental to users of financial statement. Meaning of other Matter: A Para [&...

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