Case Law Details
In re Divisional Forest Officer (GST AAAR Uttarakhand)
Issue- Only issue to be decided in present appeal is that “whether Abhivahan Shulk (Transit Fee) collected by the appellant (A Govt. of Uttarakhand Department and one of the limbs 819/X-2-2012-21(13)/2011 dated 8.05.2012 shall be exigible to GST under SAC 9997 as Other Services or not”?
Held by AAAR Uttarakhand-
Only such activities and transactions undertaken by the Central Government, a Slate Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendations of the Council are not supply. Abhivahan Shulk is not covered under SI. No. 4 of the notification No. 12/2017-CT (R) dated 28.06.2017 since the entry applies to functions entrusted to Municipalities. Similarly serial entry no. 5 of the said notification relates to functions entrusted to Panchayat. On the other hand, Serial no. 6 of the said notification states that Services by the Central Government, State Government, Union territory or local authority excluding the following services — (a) (b) (c) (d) any service, other than services covered under entries (a) to (c) above, provided to business entities are to be taxed at `NIL’ rates. Abhivahan Shulk does not fall under exclusion clauses (a) to (c) and hence they are to be treated as any service provided to a business entity, as per clause (d) and accordingly the fee does not fall under the category of ‘NIL’ rate. The Heading number 9997 at entry serial no. 35 of Notification no. 11/2017-Central Tax (Rate) dated 28.06.2017 reads – Other services (washing, cleaning and dyeing services; beauty and physical well-being services; and other miscellaneous services including services nowhere else classified) with the CGST rate of 9% [The corresponding entry in notification no. 08/2017-Integrated Tax (Rates) dated 28.06.2017 having IGST rate of 18%]. This entry serial is the residuary entry which covers all other services which are not elsewhere specified. As discussed above, the Abhivahan Shulk cannot he covered under notification relating to “NIL” rate nor does it correspond to any entry for services that are taxed at 24%. Hence, this fee has to he covered under the residuary heading 9997 for other services with the tax rate of CGST@ 9%, SGST@9/0 and IGST @ 18%.
As to the alternate plea of the Appellant regarding payment of GST by the recipients, on reverse charge basis, we find that this plea did not form a part of the original application that was filed before the AAR and the issue was not examined by the original Authority on Advance Ruling and accordingly no orders to this effect was passed. Advance Ruling was sought only to decide the exigibility of Abhivahan Shulk. The Reverse Charge mechanism is governed by certain laid down conditions and criteria. In absence of specific details, it is impossible to arrive at a reasoned decision. Hence we cannot consider the issue at the appellate stage without it forming a part of the order in original. However, the rules and procedures regarding reverse charge mechanism are unambiguously laid down and in the era of self assessment procedure, it is for the assessee to ascertain whether he fulfils the terms and conditions governing payment of GST on reverse charge.
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