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 Sounder, Radio Detecting & Ranging etc
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING MAHARASTRA
(under Section 101 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017)
At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the MGST Act.
The present appeal has been filed under Section 100 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MGST Act”] by A S MOLOOBHOY PRIVATE LIMITED(herein after referred to as the “Appellant”) against the Advance Ruling No. GST-ARA-14/2017-18/B-71 dated 18.07.2018.
BRIEF FACTS OF THE CASE
A. The Appellant, having Goods and Service Tax (‘GST’) Registration No. 27AAMCA4160E1ZT is inter alia engaged in the business of sale and distribution of Marine Distress Signals, EPIRB and SART, SSAS, Marine Chemicals, Navigation and Communication (NAVCOM) Equipment and also providing Life Saving equipment such as Life raft, Lifeboat and Fire-fighting services, including Pyrotechnic Disposal, Electronic Services and Training Services related to the Marine Industry.
B. Appellant imports various goods/spares, which are supplied on ships and these equipment form an essential part of the ship, and makes the ship “sea worthy.”
C. Appellant was levying GST on most of the parts/equipment supplied by it at the rate of 18%.Appellant was receiving purchase orders for such parts/spares/equipment from reputed customers wherein orders were placed on specific terms that applicable GST rate on items ordered was 5% as all such parts and equipment, ordered, are forming part of ship. The customers strongly contended that the relevant tax entry for taxing such goods is Sr.No.252 of Notification No.1/2017 Central Tax which specifically covers Parts of goods of headings 8901, 8902, 8904, 8905, 8906, 8907.Charging tax at higher rate of 18% was making appellant noncompetitive in the market.
D. Based on the information from customers and market trend, appellant also felt that GST rate should be 5% on the goods supplied by them as same are essential part of ship which makes the ship seaworthy as it is legally obligatory for ships to have fitment/installation of all such spares and equipment to qualify as seaworthy. Such parts/equipment should be classified under the tariff heading of “Parts of goods of headings 8901, 8902, 8904, 8905, 8906, 8907.”
