2022 (4) TMI 1334 - AAR - GST

Maintainability of Advance Ruling application - Works Contract or not - supply made by NEC under the AFC project - composite supply or not - supply would qualify as an original works meant predominantly for use other than for commerce, industry, or any other business or profession, thereby attracting GST rate of 12% provided in the Not. No. 24/2017-CT (Rate) dtd. 21-9-17 - classification under 8470 or SAC 9954? - maintenance and management services post service would qualify as Composite Supply or not - HELD THAT - Section 103(1) CGST Act, stipulates that Advance Ruling shall be binding only on the applicant who had sought it and on the concerned officer/jurisdictional officer in respect of the applicant. Now, NEC Technologies Pvt. Ltd. is the supplier of service and our Ruling cannot be binding on the supplier of service M/s NEC Technologies Pvt. Ltd., who is a GST registered person in Delhi with GST 07AACCN3496J1Z4. SSDCL is not the supplier of service to seek the Service code (Tariff)/ GST Rate/ nature of service supplied by NEC Technologies Pvt. Ltd. The Advance Ruling is sought by SSDCL to determine the SAC, and GST Tax rate liability supplied by NEC Technologies Pvt. Ltd. to SSDClL. Shri Shah during hearing insisted that the subject application is maintainable and has, thereby, failed to appreciate the statutory provisions of Chapter XVII- Section 95, 97 and 103 CGST Act. Application dismissed as being non-maintainable.

Summary

Issues:
1. Classification of supply under the AFC project - Works Contract or Composite Supply.
2. GST rate applicable to the supply made by NEC under the AFC project.
3. Classification of supply under SAC 8470 or 9954.
4. Qualification of maintenance and management services post-service as a Composite Supply and eligibility for exemption.

Classification of Supply - Works Contract or Composite Supply:
The applicant sought an advance ruling to determine whether the supply made by NEC under the AFC project would qualify as a 'Works Contract' or a 'Composite Supply.' The Authority found that the applicant, SSCDL, awarded a Work Contract to NEC for specified supply, making NEC the supplier of service. The ruling clarified that the applicant does not have the standing to seek the Service code or GST rate for the service supplied by NEC. The ruling was deemed non-maintainable under Section 95(a) of the CGST Act as the applicant lacked locus standi in the matter.

GST Rate Applicability:
The ruling also addressed the issue of determining the GST rate applicable to the supply made by NEC under the AFC project. The applicant insisted that the application was maintainable, but the Authority highlighted that the ruling cannot bind the supplier of service, NEC Technologies Pvt. Ltd. The Authority emphasized that any ruling issued would not be binding on the supplier, thereby rendering the issuance of a ruling in this case futile and in violation of Section 103(1) of the CGST Act.

Classification under SAC 8470 or 9954:
The classification of supply under SAC 8470 or 9954 was also a point of contention. However, the ruling primarily focused on the maintainability of the application and the lack of standing of the applicant to seek such classification or GST rate information from the Authority.

Qualification of Maintenance and Management Services as Composite Supply:
Lastly, the ruling considered whether the maintenance and management services post-service would qualify as a Composite Supply and be eligible for exemption under Notification No. 12/2017-CT (rate) if the value of supply of goods constituted not more than 25% of the said Composite supply. However, the ruling primarily rejected the application on the grounds of non-maintainability and lack of locus standi of the applicant in the matter.

In conclusion, the Authority rejected the application as non-maintainable under Section 95(a) and Section 103(1) of the CGST Act, emphasizing the lack of standing of the applicant in seeking such rulings related to the supply made by NEC under the AFC project.