2020 (5) TMI 414 - AAR - GST

Scope of Advance Ruling application - Section 97(2) CGST Act 2017 - Availability of FIRC in respect of Export proceeds with respect to services for funds received through service providers - Documents required for export without payment of tax - refund proceedings, due to non-availability of FIRC or any other supporting documents - HELD THAT - The question sought by the applicant is outside the scope of Section 97 (2) of CGST Act 2017 therefore the application is liable for rejection without going in to the merit of the case under Section 98(2) of CGST Act 2017. Since question sought by the applicant is outside the scope of Section 97(2) of CGST Act 2017 therefore, the application is not admitted.

Summary

Issues:
- Applicability of a notification issued under the provisions of the CGST Act.
- Availability of FIRC in respect of export proceeds for funds received through service providers like Paypal.
- Documents required for export without payment of tax to prove receipt of proceeds in foreign currency.
- Procedure to follow in case of non-availability of FIRC or supporting documents for refund proceedings.

Analysis:
The applicant, engaged in software consultancy, sought an advance ruling on export services under the GST Act. They highlighted the eligibility for GST refund on zero-rated supply under Rule 1(2) of refund rules and Section 54 dealing with export of services. The applicant expressed concerns regarding the requirement of FIRC/BRC Details for refund application, especially when their receiving bank does not issue FIRC Certificates except for FDI cases. They also questioned the contradictory provisions in obtaining FIRC Certificates for funds received through intermediaries like Paypal.

The advance ruling application raised specific questions regarding the availability of FIRC for export proceeds received through service providers like Paypal and the documentation needed to prove receipt of proceeds in foreign currency when FIRC is not obtainable. Additionally, the applicant inquired about the procedure to follow in refund proceedings if FIRC or other supporting documents are unavailable, emphasizing the challenges faced due to conflicting provisions in different statutes.

During the personal hearing, the applicant reiterated their submissions and requested early disposal of the application. The jurisdictional officer emphasized the mandatory requirement of FIRC/BRCs under Rule 89(2) of CGST Rules 2017 to evidence realization of export proceeds in foreign currency. The officer suggested a process through Paypal's website to obtain FIRC copies, addressing the applicant's concerns regarding documentation.

However, the Authority for Advance Ruling found that the questions raised by the applicant fell outside the scope of Section 97(2) of the CGST Act 2017. Consequently, the application was deemed inadmissible under Section 98(2) of the CGST Act 2017 without delving into the merits of the case. The ruling concluded that since the questions were beyond the specified scope, the application could not be accepted for further consideration.

In summary, the judgment clarified the limitations of the advance ruling scope under the CGST Act, leading to the rejection of the application due to the questions raised not aligning with the provisions outlined in Section 97(2). Despite the applicant's valid concerns regarding FIRC requirements for export proceeds, the ruling focused on the statutory boundaries of the advance ruling authority, ultimately resulting in the application being deemed inadmissible.