Case Law Details
In re Sunil Giri (GST AAR Rajasthan)
Question: Whether the value of diesel, provided by the customer (service recipient) to the trucks, under the facts and circumstances of the case is required to be added to the freight charged by the Applicant for the purposes of the Central Goods & Service Tax Act, 2017 (CGST Act, 2017) & the Rajasthan Goods & Service Tax Act, 2017 (RCGST Act, 2017?
Answer: The value of diesel filled free of cost (FOC) by the service recipient is not includable in the value of the GTA service proposed to be provided by the Applicant in the facts and circumstances of the present application subject to conditions as mentioned in draft Transport Service Agreement/ contract incorporated in the body of this decision/ruling.
Hon’ble Supreme Court in CST v. Bhayana Builders (P) Ltd. 2018 (2) TMI 1325-SC has held that where the service provider receives free of cost goods/material from the service recipient, no amount is charged for such goods/material and, therefore, the value of such goods/ materials cannot be included in the gross amount charged by the service provider for the service provided by him. The issue whether free of cost diesel of the service recipient is required to be added in the value of the service provided by a supplier (service provider) came to be settled in the Service tax regime in the matter of Karamjeet Singh & Co Ltd. v. CCE & ST Raipur 2017 (9) TMI 1125-CESTAT New Delhi in favour of the assessee. The Departments appeal against this CESTAT’s decision came to be dismissed by the Hon’ble Supreme Court in CCE v. Karamjeet Singh & Co Ltd. 2018 (7) TMI- SC Order. Similarly, FOC diesel provided by service recipients for various services such as mining, site formation and excavation service, helicopter charter service, business support service, etc. have been held not to be included in the value of such services in R.K. Transport Company v. CCE 2020 (11) TMI CESTAT New Delhi, Heligo Charters Pvt. Ltd. v. CST Mumbai-VI 2020 (4) TMI 182-CESTAT Mumbai, Ganpati Associates, Munshi Lal Durga Prasad v. CCE Jaipur 2019 (5) TMI 1233 – CESTAT New Delhi.
FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, RAJASTHAN
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