In re Safset Agencies Private Ltd (Astaguru.com) (GST AAR Maharashtra)
(i) Paintings as described by the applicant will be classifiable under Heading 9701 and the applicant must pay GST of 12% on the sale value.
(ii) Old Cars:- Motor Vehicles fall under Heading 8703 of the GST Tariff. All the items under 8703 attract 28% GST except Tariff item 870310 10; Sub-heading 8703 80. However old cars attract a lower rate of tax as per Notification No. 08/2018 CT (Rate) dated 25.01.2018. As per the said Notification, the lesser rate of tax i.e. 18 % is applicable to old cars provided the conditions mentioned therein are fulfilled. Except submitting that they are dealing in old cars, they have not submitted any other details. It is also seen that the provisions of Rule 32(5) of CGST Rules are applicable to them, subject to the conditions of the Notification No. 08/2018 CT (Rate) dated 25.01.2018 being satisfied by them.
(iii) Old Jewellery:- Articles of jewellery and parts thereof falls under Heading 7113 of the GST Tariff. The provisions of Rule 32(5) of CGST Rules are applicable to them in respect of old jewellery which are purchased by them and then sold by them.
(iv) Antique jewellery of age exceeding 100 years:- Antique jewellery of age exceeding 100 years will fall under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. The provisions of Rule 32(5) of CGST Rules will not be applicable to them in this case.
(v) old watches:- Wrist watches, pocket-watches and other watches, including stop-watches, With case of precious metal or of metal clad with precious metal fall under CH 9101 of the GST Tariff and Wrist watches, pocket-watches and other watches, including stop-watches, ;;ether than those of Heading 9101 fall under Heading 9102 of the said Tariff. The rate of GST is 18% and the same is applicable even to Old Watches, however with the benefit of the provisions of Rule 32(5) of CGST Rules i.e. tax will be paid on the difference between sale price and purchase price considering such watches as second hand goods.
(vi) Antique watches of age exceeding 100 years:- Antique watches of age exceeding 100 years will fall under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. The provisions of Rule 32(5) of CGST Rules will not be applicable to them in this case.
(vii) Collectibles:- In view of the discussions above the question cannot be answered.
(viii) Collectibles (Books):- In the subject case the goods, if it is in the form of printed books, newspapers, pictures, etc, will fall under the various sub headings of Chapter 49 of the GST Tariff as the case may be. The Residual Entry mentioned above will only applicable to goods which are not specified in Schedule I, II, IV, V or VI. The specific details and description of ‘collectibles (books)’ has not been mentioned by the applicant and in the absence of specifics the question cannot be answered.
(ix) Antique Books:- If the antique books are under 100 years of age then they will be classified under the appropriate Heading of the GST Tariff. Antique books of less than 100 years of age, if it is in the form of printed books, newspapers, pictures, etc, will fall under the various sub headings of Chapter 49 of the GST Tariff as the case may be. Antique books exceeding 100 years of age will be covered under Tariff item 9706 00 00 and will be liable to tax @ 12% GST. Since specific details and description of ‘collectibles (books)’ has not been mentioned by the applicant the question cannot be answered.
AAAR Order-AAR cannot give ruling in absence of any specific description of products
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING,MAHARASHTRA
The present application has been filed under section 97 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 SAFSET AGENCIES PRIVATE LTD ,(Astaguru.com) , the applicant, seeking an advance ruling in respect of the following questions.
1.1 Whether Applicant is dealing in second hand goods and tax is to be paid on the difference between selling price and purchase price as stipulated in Rule 32 (5) of CGST Rules, 2017?
1.2. The classification and HSN code of goods listed in table given in “Issues for Determination” and GST rates applicable to such goods.
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 any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression `GST Act’ would mean CGST Act and MGST Act.
02 FACTS AND CONTENTION — AS PER THE APPLICANT
The submissions, as reproduced verbatim, could be seen thus-
STATEMENT OF THE RELEVANT FACTS HAVING A BEARING ON THE QUESTION(S)
ON WHICH THE ADVANCE RULING IS SOUGHT
1. This Application is being filed by Safset Agencies Private Limited (com) (“Applicant”).
2. Applicant, having Good and Service Tax (“GST”) Registration No. 27AABCS9352H124.
3. Applicant is an auctioneer dealing in various goods such as paintings, vintage collectibles, sculptures, classic miniatures paintings, fine writing instruments, vintage timepieces, celebrity memorabilia, aristocratic jewellery and vintage cars (hereinafter referred to as “goods”).
Applicant usually procures the abovementioned goods on approval basis from unregistered as ell as registered persons (“sellers”). Applicant displays all such goods on its website and ducts the auction sale in respect of such goods. The goods are sold to the highest bidder in the auction.
5. The standard business process of Applicant is as under:
(i) Intending seller and Applicant sign an ‘on approval contract wherein intending seller agrees to sell his goods to the applicant on approval basis at mutually agreed price.
(ii) On receipt of goods on approval and being satisfied with quality and authenticity of the goods, Applicant uploads the details of goods for online auction.
(iii) The goods remain in the possession of Applicant during the mutually agreed period of approval. Applicant has right to retain or return the goods during the approval period. Either approval is granted by Applicant within 6 months from the date on which it receives the said goods and purchases the same at mutually agreed price or returns the said goods to the intending seller.
(iv) After conveying the approval and confirming purchase of goods, Applicant sells the goods to buyer in auction.
(v) Applicant attracts buyers for the auction in the following manner:
a. It maintains a list of buyers who have previously interacted and/or purchased any goods from the Applicant by participating in the auction.
Whenever the Applicant organizes any auction, it sends an invitation to all such buyers inviting them to participate in the preview wherein goods to be auctioned are displayed. Thereafter the buyers can choose whether they want to participate in the auction or not.
b. Applicant advertises their auction on various mediums such as social media, hoardings, newspaper, etc. Such other persons can also participate in the preview event subject to them being registered with the Applicant.
(vi) A person who wants to participate in the online auction will be required to register themselves on the Applicants website. On receipt of application, the Applicant is at the liberty to accept or reject the registration application.
Once the person is registered, they can freely participate in the auction.
(vii) The highest bidder in the auction only has a claim over the goods and the Applicant reserves rights to cancel the transaction even after the fall of hammer.
(viii) The ownership of the goods is transferred after the sale invoice is issued to buyer by the Applicant.
