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2024 (3) TMI 740 - AAAR - GSTScope of supply - transfer of title of goods by the Applicant to its customers or multiple transfers within the FTWZ - goods stored in FTWZ will be covered under the scope of Schedule III of the CGST Act 2017 or not - applicability of Integrated Tax (IGST) Circular No. 3/1/2018 dated 25.05.2018 - HELD THAT - Since the Authority for Advance Ruling had erred in not answering the question raised by the Appellant in its entirety and also not discussed all the contentions of the Appellant put forth in their original application. Hence justice will be met by remanding the case to the lower authority with direction to consider the question raised by the Appellant in its entirety to give findings on the other points raised by the Appellant and to offer them another opportunity of personal hearing before deciding the case as per the provisions of law. The AAR should examine afresh whether the activities proposed to be undertaken by the Appellant are covered by entry 8(a) 8(b) or any other entry in Schedule III of CGST Act 2017 or otherwise. All aspects of the matter are kept open for decision by the AAR.
Issues Involved:
1. Whether the transfer of title of goods within the FTWZ results in bonded warehouse transactions covered under Schedule III of the CGST Act, 2017. 2. Applicability of Integrated Tax (IGST) Circular No. 3/1/2018 to the present factual situation. Summary: Issue 1: Transfer of Title of Goods within FTWZ and Schedule III of CGST Act, 2017 The Appellant, a private limited company, proposed to operate import and resale transactions from a Free Trade Warehousing Zone (FTWZ) and sought clarification on whether such transactions would be covered under Schedule III of the CGST Act, 2017. The Authority for Advance Ruling (AAR) ruled that these transactions would not be covered under Schedule III, specifically paragraph 8(a), as FTWZ is not a warehouse licensed under the Customs Act, 1962. The Appellant contended that their transactions should be covered under paragraph 8(b) of Schedule III, which pertains to the supply of goods by the consignee to any other person by endorsement of documents of title to the goods before clearance for home consumption. The Appellate Authority found that the AAR had restricted its findings to paragraph 8(a) and had not considered paragraph 8(b) or other relevant points raised by the Appellant. Therefore, the case was remanded to the lower authority for reconsideration and a comprehensive ruling. Issue 2: Applicability of IGST Circular No. 3/1/2018 The AAR stated that the IGST Circular No. 3/1/2018 had been rescinded due to amendments in Schedule III of the CGST Act, 2017. The Appellant agreed that this question no longer proved to be of relevance as the circular was rescinded. Therefore, this issue did not survive for further consideration. Order: The Appellate Authority set aside the Advance Ruling No. 23/ARA/2023 and remanded the matter to the lower authority for reconsideration, directing them to address the question in its entirety, including the applicability of paragraph 8(b) of Schedule III and other relevant points raised by the Appellant. The lower authority was instructed to follow the principles of natural justice and offer another opportunity of personal hearing before deciding the case.
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