In re Guitar Head Publishing LLP (GST AAR Karnataka)
Whether GST is payable on Guitar Head Books purchased from Amazon Inc.-USA (located outside India) in a context where the Guitar Head Books so purchased are not brought into India?
We invite reference to Schedule III relevant to Section 7 of CGST Act 2017, which specifies certain activities or transactions that shall be treated neither as a supply of goods nor a supply of services. Para 7 of the said schedule stipulates that 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 as neither supply of goods nor supply of services. In the instant case the applicant is involved in supply of books, purchased from Amazon who owned the books, from a place outside India, a non-taxable territory, to another place outside India, a non-taxable territory, without the said goods entering into India. Thus the impugned supply of books by the applicant is neither supply of goods nor supply of services, in terms of schedule II to Section 7 of the CGST Act 2017.
The Guitar Head Books purchased from Amazon Inc.-USA (located outside India) and supplied to the customers located outside India, without bringing into India do not attract any GST, in terms of Schedule III to Section 7 of the CGST Act 2017.
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, KARNATAKA
M/s. Guitar Head Publishing LLP, # 306/A, Ground Floor, 13th Cross, Near LCA Ramesh Nagar, Marathahalli, Bengaluru-560037 having GSTIN number(29AAVFG2223QlZN), have filed an application for Advance Ruling under Section 97 of CGST Act,2017, KGST Act, 2017 & IGST Act, 2017 read with Rule 104 of CGST Rules 2017 & KGST Rules 2017, in form GST ARA-01 discharging the fee of Rs.5,000/- each under the CGST Act and the KGST Act.
2. The Applicant is engaged in business of selling guitar training books in United States of America, United Kingdom & Canada through their Website, Applicant sends soft copy of the book to the printer located in USA, who in turn prints it and Ships to the customer located in USA, UK and Canada. Further, in another business model Applicant is having an agreement with Amazon Inc. Who through their website “amazon.com” based on the choice of the customers either prints the books and sells it to the consumers on their own account or will share the link to download the e-books material in an of the electronic devices & pays royalty to Applicant as agreed between the 2 parties.
In view of the above, the Applicant sought advance ruling in respect of the following question.-
i. Whether GST is payable on Guitar Head Books purchased from Amazon Inc.-USA (located outside India) in a context where the Guitar Head Books so purchased are not brought into India?
3. Statements of relevant facts having a bearing on the question(s) raised:
3.1 The Applicant is in the business of selling guitar training books in United States of America, United Kingdom & Canada through their Website. Applicant sends soft copy of the book to the printer located in USA, who in-turn prints it and Ships it to the customer located in USA, UK and Canada. Further, in another business model Applicant is having an agreement with Amazon Inc. who through their through their website “amazon.com” based on the choice of the customers either prints the books and sells it to the consumers on their own account or will share the link to download the e-books material in any of the electronic devices & pays royalty to Applicant as agreed between the 2 parties.
3.2 Applicant is a Limited Liability Partnership registered under the LLP Act 2008. Applicant’s vision is to make available the guitar training books to every individual in the countries of USA, UK & Canada either the paperback books or e-books and also reach entire global market at the earliest. The main intention for guitar training books is that, in learning music from musician – there are few limitations like: long duration, physical attendance for training. But, with the applicant’s guitar training books, every individual can learn at their leisure time.
3.3 Business model:
Applicant has three 3 models:-
a) Sales through Own website
b) Sales through Amazon platform
c) Online Guitar training Courses through the website of Guitar Head
Sales through own website:
In this transaction, Applicant places the order with Amazon Inc to supply Guitar Head Books. Amazon Inc supplies the Guitar Head Books by billing it to Guitar Head Bangalore and Ships the Guitar Head Books to the warehouse located outside India. The books are stored in the warehouse for quick delivery to the customer.
Customer in USA, UK and Canada places an order through Applicant’s website by making payment in Foreign Currency. Applicantshares the order detail to the warehouse service provider, who in turn ships the books to customer. Applicant pays warehouse charges & Shipping charges to the respective service provider. Applicant collects with the price of book along with shipping charges.
