2021 (12) TMI 164 - AAR - GST

Classification of goods - rate of GST - Roasted Chana products - HELD THAT - It is found that the proceedings have already been initiated by Revenue in July 2021 against M/s Jabsons with respect to subject questions raised in the application filed in September 2021. As per Section 70(2) of CGST Act, every such inquiry referred to in sub-section (1) shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code. Thereby it is held that subject inquiry initiated vide Section 70(1) of the CGST Act by the Revenue is a judicial proceeding. It is held that the said investigation initiated by Revenue is a proceeding within the ambit of Section 98 (2) of CGST Act. The Advance Ruling cannot be used as a mechanism to nullify the inquiry proceedings already initiated by the Revenue vide section 70(1) of CGST Act. The subject application is hereby rejected as non-maintainable and inadmissible.

Summary

Issues:
- Determination of GST rate on Roasted Chana products
- Whether the Advance Ruling Authority can proceed with the application when a similar inquiry has been initiated by the Revenue

Analysis:
- The case involved M/s Jabsons Foods seeking a ruling on the GST rate applicable to their Roasted Chana products classified under HSN Code 21069099 attracting GST at 5%.
- The Revenue, represented by CGST Vadodara-II Commissionerate, had already initiated an investigation into the matter, conducting a search and issuing summons to M/s Jabsons.
- During the personal hearing, M/s Jabsons reiterated their submissions, confirming the Revenue's actions in July 2021.
- The Authority considered the submissions from both parties and examined the declaration made by M/s Jabsons in their application form dated September 28, 2021.
- It was found that the Revenue had indeed initiated proceedings against M/s Jabsons in July 2021 regarding the same issue raised in the September 2021 application.
- Referring to the relevant sections of the CGST Act, the Authority determined that the inquiry initiated by the Revenue in July 2021 constituted a judicial proceeding and fell within the scope of Section 98(2) of the CGST Act.
- Consequently, the Authority held that the Advance Ruling could not be used to circumvent or nullify the inquiry proceedings already initiated by the Revenue under Section 70(1) of the CGST Act.
- Therefore, the Authority rejected the application from M/s Jabsons as non-maintainable and inadmissible, given the parallel inquiry already underway by the Revenue.