No advance ruling where supplies undertaken prior to date of filing of application

ARA, Rajasthan has pronounced judgment on 28.12.2021, in the case of Continental Engineering Corporation (2022) 37 J.K.Jain’s GST & VR 106, that;

“Since the question posed by the applicant related to supplies undertaken prior to the date of filing of the application for advance ruling, no ruling can be given on the questions. Hence, it is not maintainable and rejected.”

1.Background.─M/s Continental Engineering Corporation (Applicant) and M/s Jaipur Metro Rail Corporation Ltd (IMRC) entered into a Contract Agreement dated 5.10.2013 for Design and Construction of Tunnel between Chandpole and Badi Chouper by Shield TBM, Underground Metro Stations at Choti Chouper & Badi Chouper and reversal line by Cut & Cover Method on East-West Corridor of Jaipur Metro (Phase 1B) at Jaipur. The said Works could be completed on 15.3.2020 as against scheduled completion date being 14.10.2016. Thus the Works was completed in 77 months as against the original Time for Completion of 36 months due to various reasons.

As per JMRC’s letter No.F.7(C-119IMRC/EOT/2013-14/2205 dated 18.6.2020, M/s JMRC approved the extension of time for completion till 15.3.2020 i.e., the actual date of completion.

2. Findings by ARA – In the present case, the applicant sought clarification regarding taxability in respect claim of additional cost for the extended period of Contract i.e., from 15.10.2016 to 15.3.2020, classification of services so rendered, time of issue of invoice/Debit Note and time of supply for the service in the light of fact that the consideration amount is yet to be finalised.

3. Analysis & Conclusion by ARA – It would be proper in the fitment of justice to discuss the relevant provisions of the statute which are as u/s 95, CGST Act, 2017:

S.95. Definitions of Advance Ruling–In this Chapter, unless the context otherwise requires–

(a) advance ruling means a decision provided by the Authority or the Appellate Authority to an applicant on matters or on questions specified in S.97(2), or S.100(1), in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant;

The ARA are of the view that applicant wants from the authority to decide the taxability in respect claim of additional cost for the extended period of Contract i.e., from 15.10.2016 to 15.3.2020 and also classification of services so rendered, time of issue of Invoice/Debit Note and time of supply for the service. As relied upon the JMRC’s letter No.F.7(C-119/JMRC/EOT/2013-14/2205 dated 18.6.2020, we find that the date of completion of service rendered in the instant case, was 15.3.2020. We also find that the Applicant had applied for the Advance Ruling on 21.10.2021. Since the Applicant has asked for ruling on the service rendered prior to the date of filing of the application before the authority, we find it appropriate to visit the definition of the ‘Advance Ruling’ given u/s 95(a), CGST Act, as above.

From the definition, it is very much clear that the scope of the Advance ruling for Authority for Advance Ruling (AAR) is limited to the supply of service being undertaken or proposed to be undertaken. In the instant case, as already narrated, the application seeking advance ruling was filed on 21.10.2021 before the authority with respect to supplies undertaken on or before 15.3.2020. Hence, the case is out of the purview of the Advance Ruling.

4. Ruling – In view of the foregoing, the ARA ruled as under:–

As the question posed by the applicant is related to supplies undertaken by them prior to the date of filing of the application for advance ruling, no ruling can be given on the questions. Hence, the subject application for advance ruling made by the applicant is not maintainable and rejected under the provisions of the GST Act, 2017.