2021 (4) TMI 935 - AAAR - GST

Exemption from GST - inward supply of services - upfront lease amount paid to M/s. RLDA for the development of Multi functional complex (Operational building) at Erode Railway junction for long term lease for 45 years - HELD THAT - The provisions of section 103 categorically states that the ruling pronounced is binding only on the appellant. It automatically flows that if a recipient obtains a ruling on the taxability of his inward supply of goods or services, the supplier of such goods or services is not bound by that ruling and he is free to assess the supply according to his own determination, in which case, the ruling loses its relevance and applicability even. Any law provision has to be interpreted in a constructive and harmonious way keeping in mind the object of the purpose of the provision - On a conjoint reading of the provisions of Section 95(a), section 97 (2) and Section 103, it is opined that a supplier in the capacity of a recipient of his inward supplies only and not vice versa is only eligible to seek an advance ruling and not a mere recipient of goods or services in question even when he may otherwise be a supplier of his own goods or services. The Order of the Advance Ruling Authority in this matter is confirmed - appeal disposed off.

Summary

Issues:
1. Interpretation of provisions under Central Goods & Services Tax Act and Tamil Nadu Goods & Services Tax Act.
2. Appeal filed under Section 100(1) of the Acts against an Order by Tamil Nadu State Authority for Advance Ruling.
3. Applicability of exemption from tax on long-term lease of land and input tax credit.
4. Consideration of the appellant as a supplier of services.
5. Binding nature of advance rulings on the appellant and the recipient.
6. Eligibility of a supplier to seek advance rulings as a recipient of inward supplies.

Analysis:
1. Interpretation of Provisions: The judgment clarifies that the provisions of both Central Goods & Services Tax Act and Tamil Nadu Goods & Services Tax Act are mostly identical, unless specified otherwise. Any reference to one Act includes the corresponding provisions of the other Act.

2. Appeal Filing: The appeal was filed under Section 100(1) of the Acts against an Order by the State Authority for Advance Ruling. The appellant, a registered entity, challenged the ruling related to the long-term lease of land for developing a Multi-functional Complex at a railway station.

3. Tax Exemption & Input Tax Credit: The appellant sought clarification on the exemption from tax for the upfront lease amount paid for the long-term lease of land. The issue revolved around the applicability of exemption and related input tax credit in the context of the development services provided by the appellant.

4. Supplier of Services Consideration: The appellant argued that as a supplier of development services, they should be eligible to seek clarification on tax exemption and input tax credit. The Advance Ruling Authority's failure to consider the appellant's dual role as a supplier and recipient was highlighted in the appeal.

5. Binding Nature of Rulings: The judgment emphasized that advance rulings are binding only on the applicant who sought it and the concerned officers. Changes in law, facts, or circumstances can affect the binding nature of the ruling.

6. Eligibility to Seek Advance Rulings: The judgment clarified that a supplier, acting as a recipient of inward supplies, is eligible to seek an advance ruling. The ruling's relevance for the supplier is contingent on their role as a recipient, not solely as a supplier.

In conclusion, the Appellate Authority confirmed the Order of the Advance Ruling Authority, disposing of the appeal accordingly. The detailed analysis covered the interpretation of provisions, the appellant's status as a supplier, the binding nature of rulings, and the eligibility criteria for seeking advance rulings under the Acts.