2019 (12) TMI 97 - AAR - GST

Permission for withdrawal of Advance ruling application - classification for the services received by M/s. Robo Silicon Private Limited from the state of Andhra Pradesh for which Royalty is being paid - whether the service can be classified under the heading 9973 specifically under 997337 as Licensing services for the right to use minerals including its exploration and evaluation or any other service under Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 - rate of GST. HELD THAT - The applicant vide their letter dated 20.03.2019 informed that they withdraw their application filed for Advance Ruling sought for; on the ground that the notification 27/2018-Central Tax (Rate) dated 31.12.2018 by amending the notification no. 11/2017-Central Tax (Rate) dated 28.06.2017 notified CGST rate at 9% w.e.f.01.01.2019. Since the applicant intended to withdraw their application there are no reason to go into the merits of the case and accordingly the Application is disposed off.

Summary

Issues:
Classification of services received by M/s. Robo Silicon Pvt Ltd for which Royalty is paid and the applicable GST rate.

Analysis:
1. Facts of the Case: M/s. Robo Silicon Pvt Ltd is engaged in manufacturing sand and construction materials after obtaining mining rights from the Government of Andhra Pradesh. The applicant pays Royalty to the government and GST under reverse charge.

2. Questions Raised: The applicant sought clarification on the classification of services and the applicable GST rate for the Royalty paid.

3. Applicant's Interpretation: The applicant argued that the services should be classified under SAC 9973 and GST should be levied at 5% based on Notification No. 11/2017-Central Tax (Rate).

4. Legal Provisions: The applicant referred to Notification No. 11/2017-Central Tax (Rate) for the classification of services under SAC 9973. They also highlighted the applicable rate of GST for different categories of goods under Notification No. 01/2017-Central Tax (Rate).

5. Precedent: The applicant cited a ruling by the Haryana Authority for Advance Ruling, which classified similar services under group 99733 and applied GST at 5% under Reverse Charge Mechanism.

6. Discussion and Findings: The applicant later withdrew their application citing a change in CGST rate to 9% from 1st January 2019, as per Notification 27/2018-Central Tax (Rate). The Authority accepted the withdrawal without delving into the merits of the case.

7. Ruling: As the applicant withdrew the application, the Authority disposed of the case without further examination.

This judgment clarifies the classification of services received by M/s. Robo Silicon Pvt Ltd and the applicable GST rate in the context of paying Royalty to the Government of Andhra Pradesh. The withdrawal of the application based on a change in CGST rate demonstrates the impact of legislative amendments on tax implications.