2023 (1) TMI 1225 - HC - GST

Classification of supply - inter-state supply or intra-state supply? - supply of mobile recharge coupons and Direct To Home (DTH) recharge vouchers to recipients, who are located in other States - HELD THAT - In view of the fact that the amount of tax due on the transaction has already been paid and only dispute is whether it is to be treated as intra-state sale or inter-state sale, recovery of the demand raised vide order dated December 3, 2022 shall remain stayed till the next date of hearing. Adjourned to April 27, 2023.

Summary

Issues:
1. Determination of whether the supply of mobile recharge coupons and Direct To Home (DTH) recharge vouchers to recipients in other States constitutes inter-state or intra-state supply.

Analysis:
1. The main issue raised in the petition concerns the classification of the supply of mobile recharge coupons and DTH recharge vouchers to recipients in different States as either inter-state or intra-state supply. The petitioner's Senior Counsel argues that tax has been paid in the State of U.P. treating it as inter-state supply, while the State asserts it to be intra-state supply. Reference is made to Section 19 of the Integrated Goods and Services Tax Act, 2017, allowing for adjustment of wrongly paid tax, and Section 77 of The Central Goods and Services Tax Act, 2017, which exempts interest payment for such transactions.

2. To seek clarification on this issue, the petitioner submitted a representation to the Central Board of Indirect Taxes and Customs on September 7, 2017, which is still pending. Respondent no. 3's counsel assured that the representation would be reviewed, and appropriate directions would be provided by the Board within three months.

3. Considering that the tax amount for the transaction has already been paid, and the only dispute revolves around its classification as intra-state or inter-state sale, the High Court ordered that the recovery of the demand raised in the December 3, 2022 order should be stayed until the next hearing scheduled for April 27, 2023.

4. The case has been adjourned to allow for further deliberation and a decision on the classification of the supply, ensuring that the tax implications are appropriately addressed based on the final determination of whether it constitutes an inter-state or intra-state transaction.