Whether the recipient of Services can apply for Advance Ruling under GST?

DATED: 12/03/2020
IN RE PORTESCAP INDIA PRIVATE LIMITED
MAHARASHTRA AUTHORITY OF ADVANCED RULING (AAR)

QUESTION: Whether the recipient of Services can apply for Advance Ruling under GST?

SECTION 95 OF CENTRAL GOODS AND SERVICES ACT 2017 – DEFINITIONS

In this Chapter, unless the context otherwise requires, -

"advance ruling" means a decision provided by the Authority or the Appellate Authority to an applicant on matters or on questions specified in sub-section (2) of section 97 or sub-section (1) of section 100, in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant;

"Appellate Authority" means the Appellate Authority for Advance Ruling referred to in section 99;
"applicant" means any person registered or desirous of obtaining registration under this Act;
"application" means an application made to the Authority under sub-section (1) of section 97;
"Authority" means the Authority for Advance Ruling referred to in section 96.

SECTION 97 OF CGST ACT 2017: APPLICATION FOR ADVANCE RULING (CHAPTER XVII – ADVANCE RULING)

(1) An applicant desirous of obtaining an advance ruling under this Chapter may make an application in such form and manner and accompanied by such fee as may be prescribed, stating the question on which the advance ruling is sought.
(2) The question on which the advance ruling is sought under this Act, shall be in respect of, –
(a) classification of any goods or services or both;
(b) applicability of a notification issued under the provisions of this Act;
(c) determination of time and value of supply of goods or services or both;
(d) admissibility of input tax credit of tax paid or deemed to have been paid;
(e) determination of the liability to pay tax on any goods or services or both;
(f) whether applicant is required to be registered;
(g) whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both, within the meaning of that term.

SECTION 100 OF CENTRAL GOODS AND SERVICES ACT 2017 - APPEAL TO APPELLATE AUTHORITY

(1) The concerned officer, the jurisdictional officer or an applicant aggrieved by any advance ruling pronounced under sub-section (4) of section 98, may appeal to the Appellate Authority.

(2) Every appeal under this section shall be filed within a period of thirty days from the date on which the ruling sought to be appealed against is communicated to the concerned officer, the jurisdictional officer and the applicant:

Provided that the Appellate Authority may, if it is satisfied that the appellant was prevented by a sufficient cause from presenting the appeal within the said period of thirty days, allow it to be presented within a further period not exceeding thirty days.

(3) Every appeal under this section shall be in such form, accompanied by such fee and verified in such manner as may be prescribed.

FACTS OF THE CASE

This application was filed under Section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 by the applicant, seeking an advance ruling in respect of the following question: 

1. Whether Portescap India Pvt. Ltd. is required to pay tax under reverse charge mechanism on procurement of renting of immovable property services from Seepz Special Economic Zone Authority (Local Authority) in accordance with Notification No. 13/2017 dated 28th June, 2017read with Notification No. 03/2018 – Central Tax (Rate) dated 25th January 2018? 

2. Whether Portescap India Pvt. Ltd. is required to pay tax under reverse charge mechanism on any other services in accordance with Notification No. 13/2017 dated 28th June, 2017 read with Notification No. 03/2018 – Central Tax (Rate) dated 25th January 2018? 

3. If answer to the above point is in the affirmative, then the tax under reverse charge mechanism is required to he paid under which tax head i.e., IGST or CGST and SGST’?

JUDGMENT

AAR Authority made 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 purpose of this Advance Ruling, the expression `GST Act’ would mean CGST Act and MGST Act. 

Section 95 of the CGST Act, 2017 allows AAR authority to decide the matter in respect of supply of goods or services or both, undertaken or proposed to be undertaken by the applicant. 

In this case the applicant has not undertaken the supply in the subject case. The applicant is a recipient of services pertaining to renting of immovable property in the subject case. 

The impugned transactions are not in relation to the supply of goods or services or both undertaken or proposed to be undertaken by the applicant and therefore, the subject application cannot be admitted as per the provisions of Section 95 of the GST Act. 

Hence, Recipient of Services cannot apply for Advance Ruling under GST.