9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (4) TMI 1088 - AAR - GSTScope of Advance Ruling application - Benefit of concessional rate - Works Contract service received from Contractors - applicability of Entry No. 3(v) (da) of Notification 11/2017-C.T.(R) dated 28/06/2017, as amended time to time - benefiit of concessional rate available to construction of common amenities such as club house, swimming pool and amenities of like nature or not? - HELD THAT - It is the supplier who is expected to ask the questions by way of filing of the Advance Ruling application. In the present case, both the questions asked are such that in these transactions, the applicant is the recipient and not the supplier of goods or services or both. In the first question it is asked whether particular provisions of notification applies in respect of services received from contractor. Here, the contractor is the service provider and applicant is the recipient of service. In second question the applicant wants to know whether the benefit of concessional rate would be available to construction of common amenities such as club house, swimming pool and amenities of like nature in the subject case. Since construction activities are being undertaken by the respective contractor, in both the questions nature of transactions is such that the applicant is the recipient and not the supplier. Sub-section (1) of section 103 of the CGST Act, 2017 categorically speaks that the ruling pronounced is binding only on the applicant and on the concerned officer or the jurisdictional officer in respect of the applicant. If an application is filed by the recipient of goods or services or both on the taxability of his inward supply of goods or services and ruling is pronounced accordingly, such ruling shall be binding only on him and on the concerned officer or the jurisdictional officer of him. In no way, the ruling shall be binding on the supplier of such goods or services. Since provisions of Sec 95 (a) are very clear and unambiguous that only a supplier can file an application for advance ruling, the contentions of the applicant are not accepted. The said provisions were discussed with the applicant's authorized representative during the course of the final hearing and he agreed that the questions are not maintainable and not capable of being covered under Scope of section 95(a) of GST Act.
Issues Involved:
1. Applicability of Entry No. 3(v)(da) of Notification 11/2017-C.T.(R) to works contract services received from contractors. 2. Availability of concessional rate for construction of common amenities like club house, swimming pool, etc. Issue-wise Detailed Analysis: 1. Applicability of Entry No. 3(v)(da) of Notification 11/2017-C.T.(R) to Works Contract Services Received from Contractors: - The applicant, M/s Romell Real Estate Private Limited, sought an advance ruling to determine if Entry No. 3(v)(da) of Notification 11/2017-CT (Rate) dated 28/06/2017, as amended, applies to the 'works contract service' received from its contractors. - The project in question qualifies as an 'Affordable Housing Project' (AHP) with more than 50% of Floor Space Index (FSI) utilized for units below 60 sq. mts. - The applicant referred to previous rulings and notifications, arguing that the works contractors should levy GST at 12% in terms of the Notification 11/2017-CT (R). - The jurisdictional officer concurred that the benefit of the reduced rate of 6% CGST is available to contractors providing composite supply of works contract to the developer for units up to 60 sq. mts. However, the benefit is not applicable to units exceeding this size. - The authority observed that Section 95(a) of the GST Act specifies that only the supplier, not the recipient, can seek an advance ruling. Since the applicant is the recipient of services, the questions posed do not fall within the scope of Section 95(a). 2. Availability of Concessional Rate for Construction of Common Amenities: - The applicant also sought clarity on whether the concessional rate applies to the construction of common amenities such as a club house, swimming pool, etc. - The jurisdictional officer stated that amenities like club houses and swimming pools are not covered under the descriptions specified in Sr. No. 3(v)(da) of Notification 11/2017 as amended by Notification 1/2018. Therefore, the concessional rate would not apply to works contract services for these amenities. - The authority reiterated that the applicant, being the recipient and not the supplier of services, cannot seek an advance ruling on these matters as per Section 95(a) of the GST Act. Observations and Findings: - The authority emphasized that the provisions of Section 95(a) are clear and unambiguous, allowing only suppliers to file an application for an advance ruling. - The applicant's argument that the term 'supply of goods or services or both' includes both inward and outward supply was not accepted. - The ruling would only be binding on the applicant and the concerned officer, not on the supplier of goods or services, rendering the ruling ineffective if the supplier does not adhere to it. - The authority concluded that the applicant cannot seek an advance ruling in relation to supplies where they are the recipient. Order: - The questions raised by the applicant were not answered due to the reasons discussed. - The authority did not provide a ruling on whether Entry No. 3(v)(da) of Notification 11/2017-C.T.(R) applies to works contract services received from contractors or if the concessional rate applies to the construction of common amenities.
|
