9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (4) TMI 102 - AAAR - GSTPrinciples of natural justice - decision was not taken by same members of AAR who have heard the case - Taxability - club and association services - services such as short-term accommodation, restaurant and recreational services provided by them to its members - principle of mutuality - HELD THAT - The contention of the appellant is noted that though the said amendment was retrospective, however, it was not passed by all state assemblies as well as it was not operational till the date when the Ruling was pronounced. This amendment was brought into force vide Notification No. 39/2021-Central Tax dated 21.12.2021 w.e.f. 1.1.2022. The Advance Ruling has been pronounced on 27.09.2021 on the basis of an amendment which was not operational as on the date of pronouncing Ruling. The appellant avers that such a Ruling is not sustainable and deserves to be quashed. The AAR need to take note of the contentions pass a speaking order with reference to them. It is also noted that the decision was not taken by same members of AAR who have heard the case - This is a violation of the principles of natural justice. The Ruling of the AAR, Rajasthan is set aside matter is remanded back to AAR to decide the application de-novo after all the contentions of the appellant.
Issues Involved:
1. Whether the services provided by the club to its members are taxable under GST. 2. Whether the delay in filing the appeal should be condoned. 3. Whether the ruling by the Authority for Advance Ruling (AAR) was legally sustainable. Summary: Issue 1: Taxability of Services Provided by the Club The appellant, M/s Umed Club, sought an Advance Ruling to determine if the services such as short-term accommodation, restaurant, and recreational services provided to its members are taxable under GST. The AAR, Rajasthan, in its Order dated 27.09.2021, concluded that these services are taxable as per clause (aa) of sub-Section (1) of Section 7 of the CGST Act, 2017, effective from July 1, 2017. The appellant contended that based on the Hon'ble Supreme Court's judgment in the case of State of West Bengal VS Calcutta Club Limited, services provided by incorporated clubs to their members were not taxable under the erstwhile service tax regime and argued that the same should apply under the GST regime. They also pointed out that the definition of "person" under Section 2(84) of the CGST Act, 2017, is identical to that in the service tax regime, implying that the same interpretation should apply. Issue 2: Delay in Filing the Appeal The appellant filed the appeal on 20.11.2021, beyond the stipulated 30-day period, citing the suo-moto extension of the limitation period by the Hon'ble Supreme Court in Miscellaneous Application No 665 of 2021. The Supreme Court had extended the limitation period from 15.03.2020 to 28.02.2022 due to the COVID-19 pandemic, which the appellant argued should justify the delay. Issue 3: Legal Sustainability of the AAR Ruling The appellant argued that the AAR's ruling was legally unsustainable for multiple reasons: - The decision was pronounced after a delay of almost one and a half years, whereas it should have been within 90 days as per Section 98(6) of the CGST Act, 2017. - The members who heard the case were different from those who pronounced the decision, violating the principles of natural justice. - The AAR relied on a retrospective amendment introduced by the Finance Act, 2021, which was not operational at the time of the ruling. This amendment was notified to be effective from 1.1.2022, whereas the ruling was pronounced on 27.09.2021. Conclusion: The Appellate Authority for Advance Ruling, Rajasthan, noted the extension of the limitation period by the Supreme Court and accepted the delay in filing the appeal. It also acknowledged the appellant's contention regarding the retrospective amendment and the change in the AAR members who heard and decided the case. Consequently, the ruling of the AAR, Rajasthan, dated 27.09.2021, was set aside, and the matter was remanded back to the AAR for a de-novo decision, taking into account all the contentions of the appellant.
|
