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2022 (6) TMI 250 - AAR - GSTSeeking clarification on determination of transaction value in case of supplies made free of cost by recipient by suppliers as per terms of contract - contracts with a host of vendors/suppliers for extraction of coal - HELD THAT - The commodity Diesel is covered under Entry 54 to the List II of the Schedule VII to the Constitution of India and therefore it is excluded from levy of GST and hence beyond the scope of Chapter XVII of the CGST Act, 2017. Application dismissed.
Issues:
1. Application for Advance Ruling under Section 97(1) of TGST Act, 2017. 2. Determination of transaction value in case of supplies made free of cost by recipient by suppliers as per terms of contract. Analysis: 1. The application was filed by M/s. The Singareni Collieries Company Limited seeking clarification on their liability under GST when supplying diesel free of cost to contractors. The application was admitted after the applicant paid the required fee and the jurisdictional officer raised no objection. 2. The questions raised in the application pertained to the determination of transaction value in cases where supplies are made free of cost by the recipient as per the contract terms. The authorized representatives of the company attended a personal hearing and urged for a prompt disposal of the application on its merits. 3. The Authority for Advance Ruling discussed the case and found that diesel falls under Entry 54 of List II of Schedule VII to the Constitution of India, making it exempt from GST levy. As a result, the application was rejected based on the exclusion of diesel from the scope of Chapter XVII of the CGST Act, 2017. This judgment clarifies the tax treatment of supplying diesel free of cost under GST laws, emphasizing that diesel is exempt from GST as per the constitutional provisions. The ruling provides guidance on the determination of transaction value in such scenarios, ultimately leading to the rejection of the application based on the specific exemption of diesel from GST levy.
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