Case Law Details
In re M/s. Mukesh Trading Co. (Mukesh Agarwal) (GST AAR Punjab)
1. Introduction: In the case of Mukesh Agarwal, a work contractor engaged in construction projects for various government departments, the GST AAR Punjab rejected the advance ruling application due to the applicant’s failure to submit the prescribed ARA-01 form and the requisite fee.
2. Background and Proceedings: Mukesh Agarwal, based in Malout with GST Registration No. 03AALPA2772Q1ZI, had secured a bid for construction work that included providing a new Toyota Innova Crysta Zx automatic vehicle to the awarder. The running expenses of the vehicle during the project were to be borne by the applicant, and upon completion of the work, the vehicle was to be transferred to the awarder at no cost.
Despite multiple notices issued on 25.03.2022 and 27.09.2022, the applicant failed to submit the application in the prescribed format (ARA-01) and did not deposit the requisite fee of Rs. 10,000 (Rs. 5,000 each for CGST and SGST), as required under the GST Act.
3. Questions on Which Advance Ruling is Sought: The applicant sought clarification on three questions related to the input tax credit (ITC) of the vehicle used in the work contract, the transfer of property in the execution of the work contract, and the eligibility to claim ITC on the purchase of the new vehicle.
4. Discussions and Findings: Given the non-compliance by the applicant, the AAR Punjab highlighted the failure to submit the application in the prescribed format (ARA-01) and the non-payment of the requisite fee. Despite providing the applicant with opportunities to rectify these deficiencies, they did not comply.
5. Conclusion and Ruling: The AAR Punjab concluded that the application was being rejected without providing any ruling due to the procedural non-compliance by the applicant. The rejection was based on the failure to submit the application in the prescribed format and the non-payment of the required fee.
6. Note on Applicable Acts: The AAR Punjab clarified that the provisions of the CGST Act, 2017, and PGST Act, 2017, are almost identical, and unless specific differences are mentioned, a reference to one act implies a reference to the corresponding provision in the other act.
7. Implications for Future Cases: This case underscores the importance of adhering to procedural requirements when seeking an advance ruling. Non-compliance with the prescribed format and fee payment can lead to the rejection of the application without addressing the substantive questions posed by the applicant. Future applicants are reminded to carefully follow the procedural guidelines to ensure a thorough and effective evaluation of their queries by the Advance Ruling Authority.
FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, PUNJAB
1. M/s MUKESH AGARWAL, Mandi Harji Ram, Malout-152107 (GST Registration No. 03AALPA2772Q1ZI) is a Work Contractor of Construction work in various Govt. Departments. The applicant has obtained a work of Bid in which as per clause of the bid a new Toyota, Innova, Crysta Zx automatic vehicle is to be provided to the awarder and all the running expenses of said vehicle will be born by the applicant and after completion of the said work the said vehicle is to be transferred to the awarder free of cost.
2. Proceedings Under Section 98 of CGST/PGST Act:
The applicant had neither submitted his application in prescribed format for Advance Ruling I.e. (ARA-01), nor had submitted the required fee i.e. Rs.10,000 (5000/- under CGST, Act and 5000/- under PGST, Act). In this regard notice dated 25.03.2022 86 27.09.2022 were issued directing the applicant to file the application in prescribed format along with requisite fee of Rs. 10,000/- (5,000 each for SGST and CGST) as prescribed under the act. Despite giving couple of opportunities applicant had neither submitted application in proper format nor deposited the requisite fee.
3. QUESTION(S) ON WHICH ADVANCE RULING IS SOUGHT:
M/s MUKESH AGARWAL, Mandi Harji Ram, Malout-152107 (GST Registration No. 03AALPA2772Q1ZI is a Work Contractor of Construction work in various Govt. Departments. The applicant has obtained a work of Bid in which as per clause of the bid a new Toyota, Innova, Crustal Zx automatic vehicle is to be provided to the awarder and all the running expenses of said vehicle will be born by the applicant and after completion of the said work the said vehicle is to be transferred to the awarder free of cost.
1. According to the above circumstances the above said vehicle is the consumable material of the work contract. Whether the applicant is entitled to get the input tax credit of the vehicle as material used in work contract?
2. Whether looking to the above circumstances the transfer of vehicle is deemed to be transferred of property in the execution of the work contract?
3. Whether the applicant claim the ITC of the purchase of above said new vehicle.
4. DISCUSSIONS AND FINDINGS:
Neither the applicant has submitted his application for Advance Ruling in prescribed format i.e. ARA-01, nor has deposited the requisite fee for filling Advance Ruling application is Rs. 10,000/- (Rs. 5,000 each for CGST and SGST). Despite giving couple of opportunities, the applicant has not deposited the required fee of Rs. 10,000 under (Rs.5,000 each for CGST and SGST). Thus, the application is hereby filed without any ruling.
Note: The provisions of CGST Act, 2017 and PGST Act, 2017 are almost same except a few provisions. Unless specific reference is made to such dissimilar provisions in the two acts, reference to provisions of CGST Act, 2017 would mean a reference to the same provisions of PGST Act, 2017 and vice versa.
