Case Law Details
Case Name : In re Sterlite Technologies Ltd (GST AAR Gujarat)
Appeal Number : Advance Ruling No. GUJ/GAAR/R/04/2020
Date of Judgement/Order : 17/03/2020
Related Assessment Year :
Courts :
AAR Gujarat Advance Rulings
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In re Sterlite Technologies Ltd (GST AAR Gujarat)
The Gujarat bench of Authority for Advance Ruling recently passed a ruling in case of M/s. Sterlite Technologies Ltd (applicant) which brought a sense of ambiguity in the minds of taxpayers. The Applicant sought advance ruling on two transactions which it propose to undertake. However, In this article, only one has been discussed as the relevant question on GST laws. The applicant sought advance ruling on applicability of GST on supply of goods which were purchased outside India and then sold outside India without being brought into India.
Brief Facts of the Case
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Author Bio
This is already made amply clear as in comment that
sch III of transactions of non supply at sr. 7 covers this and also clarifications that this also not to be treated as exempt supply ( for ITC reversal )
this decision needs revision
When the Goods are sold out and out then it should be treated as export
Thanks TaxGuru & Pawan Sir! Very good analysis for quick read!
To Be Noted> “Date of Judgement/Order : 17/03/2020” – more than 3 months since passed; will be interesting to know about further developments, if any, since then !
ADMN: Factual matrix , etc., as narrated in the Order, are not fully reconcilable with the AAR’s Decision/ Ruling. For a right grip by anyone concerned, a close study is recommended !
RIDER
Q
Decision by AAR
In view of the above, IT APPEARS that the transaction is covered under the ambit of Inter-state supply and is neither exempted nor covered under export of services. THUS THE THEORY OF ELIMINATION TAKES US TO the conclusion that such supplies will be subject to levy of IGST.
UQ
In view thereof, to infer therefrom, it appears that, why no GST is leviable has not at all been addressed and argued. That explains why the Ruling suffers from the malady of a “MISTAKÉ APPARENT FROM THE RECORD” ; which provides a sufficient ground for seeking a review/rectification ?!
If the admin is really serious about making our beloved country self reliant I think the tax legislation need a complete overhaul. Am not a legal expert but the above judgement is a case in point about how complex the legislation is what are the possible ramifications of varied interpretations. Need less to add the penal provisions are draconian to say the least and without exception any difference in opinion is treated as an attempt to defraud the revenue. Once the admin reposes some faith in its citizens the citizens can and will whole heartedly reciprocate
OFFhand;
As per the ‘Comments’ of the writer, in terms of the special provisions of the GST law drawn attention to, it is a clear case of “Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India”; hence not liable for the levy. Premised so, there is no ambiguity in the law. As such, the suggestion that, – “The department should come into play and remove the ambiguity, created by this ruling” is misconceived/ does not seem to carry conviction..
On the other hand, it may be,- apart from challenging the patent absurdity in the Ruling given, in court, – a fit case for moving the AAR in a ‘review’ petition, if so advised by assisting counsel. Particularly if, in the application or in the course of the proceedings, the specific provision of the law has been duly stressed and forcefully pleaded !
Incidentally, it does not stand to reason / is anybody’s guess as to why the applicant/ its advising counsel considered it necessary or was obliged to seek a Ruling of AAR in a matter such as herein , on which no adverse view is patently possible.
How can they pass such rulings without application of mind.. Surely CBIC’s Approval must be taken by states before passing Ruling. or only CBIC must issue rulings.