2020 (1) TMI 659 - AAR - GST

Scope of Advance Ruling authority - requirement of separate registration - whether separate registration is required in the State of Karnataka for the work contract awarded to him in the State of Karnataka? - HELD THAT - The question raised by the applicant is outside the purview of this authority - The authority for Advance Ruling is created under SGST/UTSGST Act and thus ruling pronounced are applicable within the particular state only, it is for this reason that questions relating to requirement of GST registration in another state is beyond the jurisdiction of this authority and hence no ruling can be given. The question raised by the applicant pertains to GST registration in State of Karnataka, which is beyond the purview of this authority therefore no ruling is given.

Summary

Issues involved:
1. Admissibility of input tax credit of tax paid or deemed to have been paid
2. Whether the applicant is liable to be registered
3. Whether separate registration is required in Karnataka State for a works contract
4. Tax implications when purchasing goods from a dealer in Rajasthan and shipping them to Karnataka
5. Documentation required for transporting goods to Karnataka from Rajasthan

Admissibility of input tax credit:
The applicant, a registered works contractor and wholesale supplier in Jaipur, sought an advance ruling regarding the admissibility of input tax credit and liability for registration. The Authority for Advance Ruling admitted the applicant's query under Section 97(2)(d)&(f) of the GST Act, as the applicant was a registered person and no proceedings were pending.

Separate registration in Karnataka State:
The applicant questioned the necessity of separate registration in Karnataka for a works contract awarded in the state. The jurisdictional officer clarified that as per the IGST Act, the place of supply for works contract services is where the immovable property is located, thus no separate registration in Karnataka is required. The ruling authority deemed this question beyond its jurisdiction, stating that rulings are applicable within the state where the authority is established.

Tax implications on goods purchased from Rajasthan and shipped to Karnataka:
Regarding the tax implications of purchasing goods from a Rajasthan dealer and shipping them to Karnataka, the jurisdictional officer explained that CGST + SGST would be charged by the supplier in Rajasthan, as per the IGST Act, to maintain the GST chain unbroken. The officer emphasized that tax should follow the commercial transaction to avoid credit loss.

Documentation for transporting goods to Karnataka:
The applicant inquired about the required documents for transporting goods to Karnataka from a Rajasthan dealer. The jurisdictional officer cited Section 10(1)(b) of the IGST Act, stating that when goods are delivered to a recipient on the direction of a third person, the place of supply is the principal place of business of the third person. This implies that CGST + SGST would be charged by the supplier in Rajasthan.

Conclusion:
The Authority for Advance Ruling ruled that the question regarding GST registration in Karnataka was beyond its purview, as the authority's jurisdiction is limited to the state where it is established. Therefore, no ruling was provided on this matter.