|
Advanced Search Options
Case Laws
Showing 21 to 40 of 1682 Records
-
2023 (9) TMI 1663
Employees’ contribution concerning provident fund and towards insurance was deposited beyond the date prescribed under the subject statute - due date fell on a national holiday - Whether assessee could claim deduction u/s 36(1)(5)(A) concerning the employees’ contribution to Provident Fund which was deposited on 16.08.2018, as the due date fell on a national holiday i.e., 15.08.2018? - HELD THAT:- According to us, the submission advanced by Appellant cannot be accepted. Since the due date fell on a date which was a National Holiday, the deposit could have been made by the respondent/assessee only on the date which followed the National Holiday.
Respondent as noticed on 12.01.2023, is right that Section 10 of the General Clauses Act would help the respondent/assessee to tide over the objections raised on behalf of the appellant/revenue.
Therefore, question of law, as framed is answered against the appellant/revenue and in favour of the respondent/assessee.
-
2023 (9) TMI 1662
Levy of service tax interest and penalty - petitioners submits that he is not addressing arguments on merits with respect to Exhibit P6 orders-in original, but only on the manner in which the orders have been passed - HELD THAT:- Since there is some suspicion regarding the order dated 04.05.2023 that has been taken into consideration in the impugned orders, it would be appropriate to set aside those orders. Therefore, the matter remitted back to the second respondent to pass fresh orders in accordance with law, keeping in view the procedural formalities and propriety.
Petition allowed.
-
2023 (9) TMI 1661
Demand against a dead person for the period from April 2018 to March, 2019 - liability of legal heir - continuation of the business by the surviving partners without proper registration - HELD THAT:- The legal heir has received the payment of Rs. 1,23,07,455.00 which has not been disclosed by the petitioner in the newly allotted GSTIN and turnover during the year 2017-18 (from 01.07.2017 to 31.03.2018) has been shown as NIL. Hence, it is concluded that payment is received and tax is not paid. Further, he does not dispute the Assessee’s death certificate dated 15th April, 2017.
The Writ Petition is disposed off by setting aside the order dated 31.03.2023 under Annexure-1 passed by the opposite party No.1. So far as continuance of Proprietorship Firm is concerned, it is directed that a fresh proceeding shall be initiated, in which, the petitioner shall be given opportunity of hearing afresh regarding discharging of liability. The said process shall be completed within a period of three months from the date of production of the certified copy of this order.
Petition disposed off.
-
2023 (9) TMI 1660
Authority and jurisdiction of Revenue to retain substantial amounts as voluntarily deposited under protest by the petitioner - HELD THAT:- Considering the peculiar facts of the case and the position in law, it is intended that the Department hears the petitioner on these issues and takes an appropriate call on the contentions as raised by the petitioner after hearing the petitioner and by passing an appropriate reasoned order, on the contentions as urged by the petitioner and in the light of the observations made by the appellate authority. In fact, such issues have been raised by the petitioner in its recent representation dated 24 May, 2023 as addressed to the Deputy Commissioner, CGST & CEX, Mumbai Central Commissionerate which also has so far not decided. Let such exercise be undertaken within two weeks from today. Accordingly, stand over to 09 October, 2023.
-
2023 (9) TMI 1659
Seeking direction to respondent authorities for release and de-sealing of the premises and handing over the same to the petitioner - HELD THAT:- The averments therefore indicate that the premises have been desealed and the stock lying therein have been handed over for safe custody to the petitioner.
Looking to the averments made, the issue no longer survives. Petition is therefore disposed of.
-
2023 (9) TMI 1658
Modification of condition imposed by the court regarding the surrender of the applicant's passport as a bail condition - power to impound a passport lies with the court or is restricted under the Passports Act, 1967 - right to travel - HELD THAT:- It is not in dispute that the applicant has complied with the conditions mentioned in the judgment dated 26.11.2021. The applicant has also cooperated with the proceedings initiated by the respondent.
Condition (i) contained in Para-60 of judgment dated 26.11.2021, is modified to the extent that the passport of the applicant be released to him with the condition that in case he needs to travel abroad, he shall do so after obtaining necessary permission from the learned Chief Metropolitan Magistrate, Patiala House Courts, Delhi.
The present application is allowed and disposed of.
-
2023 (9) TMI 1657
Seeking permission of this Court to withdraw this writ petition - also requisition letter sent to the Registry, dated 11.09.2023, to that effect - HELD THAT:- In view of the above said requisition letter and the endorsement made by the learned counsel for the petitioner, this Writ Petition is dismissed as withdrawn.
-
2023 (9) TMI 1656
Challenge to order passed due to alleged misrepresentation by an advocate not engaged in the case - HELD THAT:- Considering the facts and circumstances of the case and submission of the parties, the respondent No.2 is directed to consider and dispose of the aforesaid representation of the petitioner for allowing it to amend the GSTR-1 form either manually or online as per the provision of Section 38(5) of the WBGST Act, 2017, in accordance with law and by passing a reasoned and speaking order and after giving opportunity of hearing to the petitioner or its authorised representative, within a period of four weeks from the date of communication of this order.
Petition disposed off.
-
2023 (9) TMI 1655
Refund of the Input Tax Credit - Rejection on the ground of time limitation - respondent's counsel argued that the refund could not be credited due to the absence of a debit in the Electronic Credit Ledger - petitioner's counsel indicated the need to file GST Form DRC-03 for voluntary payment to facilitate the refund transfer - HELD THAT:- The petitioner are directed to file the necessary form within two weeks, after which the refund amount would be credited to the petitioner's account. The writ petitions were thus disposed of with these directions.
Petition disposed off.
-
2023 (9) TMI 1654
Classification of goods - whether a Multiple Input / Multiple Output [“MIMO”] is liable to be read in conjunction with Long Term Evolution [“LTE”] product or whether the Department would be correct in its contention that Entry (iv) in CTI 8517 is principally concerned with two separate articles? - HELD THAT:- The Customs, Excise and Service Tax Appellate Tribunal [“CESTAT”] itself in its impugned order dated 12 September 2022 has understood MIMO and LTE to be the following:-
“(ii) MIMO: It is a technology wherein multiple antennas are used simultaneously for transmission and multiple antennas are used simultaneously for reception;
(iii) LTE: In telecommunication, it is a standard for highspeed cellular communication for mobile devices and data terminals. It increases the capacity and speed using a different radio interface together with core network improvements.”
The appeal merits consideration. Consequently, the appeal shall stand admitted - Issue notice.
-
2023 (9) TMI 1653
Validity of notification dated 01.03.2007, which withdrew certain tax benefits - invalidated by the doctrine of promissory estoppel due to premature withdrawal of benefits - whether notification No.69/03-CE dated 25.08.2003 was completely overshadowed by the subsequent notification No.8/2004-CE dated 21.01.2004? - misuse of process or public interest element - HELD THAT:- The present review petition has been filed pursuant to the liberty granted by the Apex court on the first proposition advanced before it that the decision of the Appellate Court relying upon the judgment in the case of Unicorn Industries [2019 (9) TMI 791 - SUPREME COURT] is incorrect.
It needs to be mentioned at the outset that the very notification No. 11 of 2007 dated 1st March, 2007, was also in question before the Apex Court in the case of Unicorn Industries apart from the other withdrawal notification No.21 of 2007, dated 25th April, 2007. The Gauhati High Court had struck down the withdrawal notifications in the case of M/S Dharampal Satyapal Limited Vrs. Union of India & Ors. [2016 (5) TMI 1074 - GAUHATI HIGH COURT], a sister concern of the present petitioners. The judgment of the Gauhati High Court has also been fairly placed titled as M/S Dharampal Satyapal Limited Vrs. Union of India & Ors. Para 27 of the judgment incorporates the stand of the respondent authorities in support of the withdrawal notification.
The decision of the Gauhati High Court on the withdrawal notification No. 11 of 2007 was subject matter of challenge before the Apex Court in Unicorn Industries. It is pertinent to say that based on the same stand of the respondents-Union of India including their contentions that under the exemption notification the mechanism of escrow was being subjected to misuse, the decision in the case of Unicorn Industries and other analogous civil appeals was rendered. As such, the instant plea raised by the review petitioners on the above Grounds are not such which are not covered by the ratio rendered by the Apex Court in the case of Unicorn Industries.
Conclusion - The cumulative effect is that the notification dated 01.03.2007, Annexure-L to the writ petition, cannot be sustained and accordingly the same is set aside. The withdrawal of tax benefits was unjustified under the doctrine of promissory estoppel, the earlier notification was effectively merged with the latter, and the respondents failed to substantiate their claims of public interest or misuse to justify the withdrawal.
The instant review petition is accordingly dismissed.
-
2023 (9) TMI 1652
Maintainability of petition - petitioner is entitled to the return of the bank guarantee and the undertaking of the directors as per the previous court order or not - HELD THAT:- The petition would become infructuous in view of the letter dated 01.09.2023 and the affidavit cum-undertaking shall also cease to operate.
The petition is accordingly disposed of.
-
2023 (9) TMI 1651
Denial of claim of input tax credit - petitioner did not appear in pursuance of the show cause notice nor did he provide any document or evidence to discharge his burden under Section 155 of the GST Act - HELD THAT:- In the present case, the petitioner, despite show cause notice, chose not to provide any evidence in respect of his claim for the input tax credit, nor did he appear for a hearing on the date fixed. When the petitioner himself has given up his right to prove his claim for the input tax credit, this Court cannot help such an assessee by entertaining this writ petition.
Petition dismissed.
-
2023 (9) TMI 1650
Delayed contributions towards PF & ESI - remittances are made after the due date under the respective Acts but before the due date of filing the income tax return - HELD THAT:- PF & ESI contributions in respect of employer are concerned the same are allowable as deduction if they are remitted before due date for filing of return of income. The assessee contends that these contributions were remitted before due date of filing of return of income which fact needs to be verified by the Assessing Officer. Therefore, we direct the AO to verify the contentions of the assessee and if these contributions are remitted before due date for filing of return of income the same be allowed as deduction.
Employees contributions towards PF & ESI - As noticed that similar issue came up for adjudication in the case of Bercos Melody House [2023 (9) TMI 1649 - ITAT DELHI] restore this issue to the file of the AO to decide the issue in the light of the observations made by the Tribunal in the case of Kanoi Paper & Industries Ltd. [2001 (5) TMI 139 - ITAT CALCUTTA-E] as held accrual of liability towards payment of salary without actual disbursement would not fasten obligation for deposits of employees contribution in the labour Acts per se . This aspect has not been found to be examined by the Assessing Officer or CIT (A). Ground of appeal is allowed for statistical purpose.
Levy of interest u/s 234B which is consequential in nature and, therefore, this is restored to AO.
Levy of interest u/s 234A - The contentions of the assessee that interest u/s 234A is not leviable as the assessee filed return on 16.10.2018 before the last date of filing of return as per CBDT Circular u/s 119 of the Act which extended the date to 31.10.2018 shall be verified by the AO. Thus, we restored this ground to the AO for verification and adjudication in accordance with law.
-
2023 (9) TMI 1649
Disallowing PF & ESI contributions u/s 36(1)(va) - HELD THAT:- Identical issue came up before the coordinate bench in the case of Rekha [2023 (8) TMI 1605 - ITAT DELHI] wherein sustained the adjustments towards belated deposits of employees’ contribution to PF/ESIC in the light of the judgment rendered in Checkmate Pvt. Ltd. [2022 (10) TMI 617 - SUPREME COURT] - The contention of the Assessee that such additions cannot be made under the umbrella of S. 143(1) is covered against the assessee the decision of the co-ordinate bench in the case of Weather Comfort Engineers Private Limited. [2023 (2) TMI 1332 - ITAT DELHI]
Methodology of calculation of default under the relevant PF/ESIC Act - The accrual of liability towards payment of salary without actual disbursement would not fasten obligation for deposits of employees contribution in the labour Acts per se. as observed by the co-ordinate bench in Kanoi Paper and Industries Ltd. [2001 (5) TMI 139 - ITAT CALCUTTA-E] - This aspect has not been found to be examined by the AO or CIT(A). Hence without expressing any opinion on merits on this aspect, we deem it expedient to restore the matter to the file of designated AO. It shall be open to the assessee to place factual matrix before the AO and take such plea for evaluation of the AO.
Appeals of the assessee are allowed for statistical purpose.
-
2023 (9) TMI 1648
Cancellation of GST Registration of the Petitioner - non-filing of returns under Section 39 of the Central Goods and Services Tax Act, 2017 - impugned order is devoid of any justifiable reasons - non-application of mind - violation of principles of natural justice - HELD THAT:- A perusal of the impugned order dated 28.02.2023 would show that the said order is passed by a quasi judicial authority. The effect of the said order would be that in absence of a registration, the Petitioner cannot carry out his business. Therefore, the effect of the said impugned order would entail civil consequences.
If this Court peruses the order, it is shocking that the Respondent No. 4 had cancelled the registration by giving a reason that the “Registration is cancelled”. This clearly shows a total non-application of mind apart from the fact that the impugned order is devoid of any justifiable reasons. Accordingly, this Court therefore sets aside the said impugned order dated 28.02.2023 thereby restoring the status back to the date on which the Show Cause notice dated 15.01.2023 was issued.
Petition disposed off.
-
2023 (9) TMI 1647
Exemption from GST - hostel accommodation being provided by the Applicant to students and working women - qualify to be a residential dwelling for use as residence or not - requirement of registration under the GST Act if aggregate turnover exceeds twenty lakh rupees in a financial year - applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant - supply of in-house food to hostel inmates, composite supply or not - scope of Section 97(2) of the GST Act.
Whether the hostel accommodation being provided by the Applicant to students and working women qualify to be a residential dwelling for use as residence as described in the above entry and thus eligible for exemption or not? - HELD THAT:- The term 'residential dwelling' has not been defined either under CGST Act or under Notification No. 12/2017. However, under the erstwhile service tax law, in paragraph 4.13.1 of the Taxation of Services: An Education Guide dated 20.06.2012', issued by the CBIC, the expression 'residential dwelling has been interpreted in terms of the normal trade parlance as per which it is any residential accommodation, but does not include hotel, motel, inn, guest house, camp site, lodge, house boat, or like places meant for temporary stay - a house/ residential dwelling for occupation contains one or more rooms with one/part of the room being used as kitchen and the other/part as living room etc. But, in the instant case, a single house with two or more rooms where normally a single family resides, is subdivided, and let out to different persons and rent being collected on per bed basis with bundle of other services against a consideration clearly constitutes a business of supplying accommodation services along with ancillary services. Thus, on this count as well, the impugned accommodation thus provided does not qualify as a residential dwelling and thus the question of using the same as residence does not arise.
It is clear that the purpose and objective of the notification is nothing but to avoid taxing residential properties taken on rent by family or individuals and the benefit of exemption is not extended to the premises which do not qualify as residential dwelling for use as residence. Further, unless the twin conditions of 'renting of residential dwelling' for 'use as residence,' being inter-twined and inseparable, are not met, the exemption is not available. As per settled position in taxation laws, especially when exemptions or concessions or benefits are to be availed, the interpretation is to be literally and strictly construed and not in liberal terms. In effect, the place rented out is neither a residential dwelling nor being rented out for use as residence.
The hostel accommodation is not equivalent to residential accommodation and hence we hold that the services supplied by the Applicant would not be eligible for exemption under Entry 12 of Exemption Notification No.12/2017-CT(Rate) dated 28.06.2017 and under the identical Notification under the TNGST Act, 2017, and also under Entry 13 of Exemption Notification No.09/2017-IT(Rate) dated 28.06.2017, as amended.
Whether the Applicant is required to register under the GST Act if their aggregate turnover exceeds twenty lakh rupees in a financial year? - HELD THAT:- The Applicant's service of providing hostel accommodation is not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017 as amended, the Applicant is very much be required to take registration under the GST Enactments, as the arrangement between the Applicant and the hostel occupants is liable to be classified as transaction in the course of furtherance of business and hence, as per Section 7(1)(a) of CGST Act, 2017 read with Entry No. 2(b) of the Second Schedule to the CGST Act, the said transaction constitutes "supply" - the Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
What is the applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant? - HELD THAT:- Hotels are meant for a temporary stay (2-5 days) and have lot of facilities and staff, but hostels are used for a longer period and have basic facilities with minimal staff required by the inmates to stay at a reasonable rate. Therefore, hostel services cannot be equated to a hotel accommodation and hotel GST rates cannot be applied to a hostel. Therefore, supply of hostel accommodation services (Tariff heading 9963) is taxable @ 9% CGST + 9% SGST under Sl. No.7(vi) of the above Notification (Sl.No.7 (ix) as per original notification).
Whether the supply of in-house food to hostel inmates is exempt as part of a composite supply? - HELD THAT:- The natural bundle has the characteristic of where one service is the main service and the other services are ancillary services which help in better enjoyment of the main service. Further, there is a single price for the combined services. The principal activity of the Applicant is supply of accommodation Services. While providing such services, the charges are being realised in a consolidated manner for the value of food and other like services rendered. The Applicant has stated that they do not charge separately for the other services provided by them. Thus, the services provided by the Applicant are composite in nature.
As per Section 8 of the CGST Act, 2017, for a Composite supply, the tax rate on the principal supply will be treated as the tax rate on the given composite supply - the Applicant provides a number of services in a composite manner, the hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, will be tax rate for the composite supply provided by them.
Scope of Section 97(2) of the GST Act - HELD THAT:- Thus, no ruling could be issued as the question put forth by the Applicant does not fall under the scope of Section 97(2) of the GST Act.
Conclusion - i) The services by way of providing hostel accommodation supplied by the Applicant are not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017.
ii) The Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
iii) The supply of services by way of providing hostel accommodation falls under Tariff heading 9963 and is taxable @ 9% CGST + 9% SGST under Sl.No. 7(vi) of the Notification No. 11/2017, Central Tax (Rate), dated 28.06.2017.
iv) The hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, is the tax rate for the composite supply provided by them.
-
2023 (9) TMI 1646
Exemption from GST - hostel accommodation being provided by the Applicant to students and working women - qualify to be a residential dwelling for use as residence or not - requirement of registration under the GST Act if aggregate turnover exceeds twenty lakh rupees in a financial year - applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant - supply of in-house food to hostel inmates, composite supply or not - scope of Section 97(2) of the GST Act.
Whether the hostel accommodation being provided by the Applicant to students and working women qualify to be a residential dwelling for use as residence as described in the above entry and thus eligible for exemption or not? - HELD THAT:- The term 'residential dwelling' has not been defined either under CGST Act or under Notification No. 12/2017. However, under the erstwhile service tax law, in paragraph 4.13.1 of the Taxation of Services: An Education Guide dated 20.06.2012', issued by the CBIC, the expression 'residential dwelling has been interpreted in terms of the normal trade parlance as per which it is any residential accommodation, but does not include hotel, motel, inn, guest house, camp site, lodge, house boat, or like places meant for temporary stay - a house/ residential dwelling for occupation contains one or more rooms with one/part of the room being used as kitchen and the other/part as living room etc. But, in the instant case, a single house with two or more rooms where normally a single family resides, is subdivided, and let out to different persons and rent being collected on per bed basis with bundle of other services against a consideration clearly constitutes a business of supplying accommodation services along with ancillary services. Thus, on this count as well, the impugned accommodation thus provided does not qualify as a residential dwelling and thus the question of using the same as residence does not arise.
It is clear that the purpose and objective of the notification is nothing but to avoid taxing residential properties taken on rent by family or individuals and the benefit of exemption is not extended to the premises which do not qualify as residential dwelling for use as residence. Further, unless the twin conditions of 'renting of residential dwelling' for 'use as residence,' being inter-twined and inseparable, are not met, the exemption is not available. As per settled position in taxation laws, especially when exemptions or concessions or benefits are to be availed, the interpretation is to be literally and strictly construed and not in liberal terms. In effect, the place rented out is neither a residential dwelling nor being rented out for use as residence.
The hostel accommodation is not equivalent to residential accommodation and hence we hold that the services supplied by the Applicant would not be eligible for exemption under Entry 12 of Exemption Notification No.12/2017-CT(Rate) dated 28.06.2017 and under the identical Notification under the TNGST Act, 2017, and also under Entry 13 of Exemption Notification No.09/2017-IT(Rate) dated 28.06.2017, as amended.
Whether the Applicant is required to register under the GST Act if their aggregate turnover exceeds twenty lakh rupees in a financial year? - HELD THAT:- The Applicant's service of providing hostel accommodation is not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017 as amended, the Applicant is very much be required to take registration under the GST Enactments, as the arrangement between the Applicant and the hostel occupants is liable to be classified as transaction in the course of furtherance of business and hence, as per Section 7(1)(a) of CGST Act, 2017 read with Entry No. 2(b) of the Second Schedule to the CGST Act, the said transaction constitutes "supply" - the Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
What is the applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant? - HELD THAT:- Hotels are meant for a temporary stay (2-5 days) and have lot of facilities and staff, but hostels are used for a longer period and have basic facilities with minimal staff required by the inmates to stay at a reasonable rate. Therefore, hostel services cannot be equated to a hotel accommodation and hotel GST rates cannot be applied to a hostel. Therefore, supply of hostel accommodation services (Tariff heading 9963) is taxable @ 9% CGST + 9% SGST under Sl. No.7(vi) of the above Notification (Sl.No.7 (ix) as per original notification).
Whether the supply of in-house food to hostel inmates is exempt as part of a composite supply? - HELD THAT:- The natural bundle has the characteristic of where one service is the main service and the other services are ancillary services which help in better enjoyment of the main service. Further, there is a single price for the combined services. The principal activity of the Applicant is supply of accommodation Services. While providing such services, the charges are being realised in a consolidated manner for the value of food and other like services rendered. The Applicant has stated that they do not charge separately for the other services provided by them. Thus, the services provided by the Applicant are composite in nature.
As per Section 8 of the CGST Act, 2017, for a Composite supply, the tax rate on the principal supply will be treated as the tax rate on the given composite supply - the Applicant provides a number of services in a composite manner, the hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, will be tax rate for the composite supply provided by them.
Scope of Section 97(2) of the GST Act - HELD THAT:- Thus, no ruling could be issued as the question put forth by the Applicant does not fall under the scope of Section 97(2) of the GST Act.
Conclusion - i) The services by way of providing hostel accommodation supplied by the Applicant are not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017.
ii) The Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
iii) The supply of services by way of providing hostel accommodation falls under Tariff heading 9963 and is taxable @ 9% CGST + 9% SGST under Sl.No. 7(vi) of the Notification No. 11/2017, Central Tax (Rate), dated 28.06.2017.
iv) The hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, is the tax rate for the composite supply provided by them.
-
2023 (9) TMI 1645
Exemption from GST - hostel accommodation being provided by the Applicant to students and working women - qualify to be a residential dwelling for use as residence or not - requirement of registration under the GST Act if aggregate turnover exceeds twenty lakh rupees in a financial year - applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant - supply of in-house food to hostel inmates, composite supply or not - scope of Section 97(2) of the GST Act.
Whether the hostel accommodation being provided by the Applicant to students and working women qualify to be a residential dwelling for use as residence as described in the above entry and thus eligible for exemption or not? - HELD THAT:- The term 'residential dwelling' has not been defined either under CGST Act or under Notification No. 12/2017. However, under the erstwhile service tax law, in paragraph 4.13.1 of the Taxation of Services: An Education Guide dated 20.06.2012', issued by the CBIC, the expression 'residential dwelling has been interpreted in terms of the normal trade parlance as per which it is any residential accommodation, but does not include hotel, motel, inn, guest house, camp site, lodge, house boat, or like places meant for temporary stay - a house/ residential dwelling for occupation contains one or more rooms with one/part of the room being used as kitchen and the other/part as living room etc. But, in the instant case, a single house with two or more rooms where normally a single family resides, is subdivided, and let out to different persons and rent being collected on per bed basis with bundle of other services against a consideration clearly constitutes a business of supplying accommodation services along with ancillary services. Thus, on this count as well, the impugned accommodation thus provided does not qualify as a residential dwelling and thus the question of using the same as residence does not arise.
It is clear that the purpose and objective of the notification is nothing but to avoid taxing residential properties taken on rent by family or individuals and the benefit of exemption is not extended to the premises which do not qualify as residential dwelling for use as residence. Further, unless the twin conditions of 'renting of residential dwelling' for 'use as residence,' being inter-twined and inseparable, are not met, the exemption is not available. As per settled position in taxation laws, especially when exemptions or concessions or benefits are to be availed, the interpretation is to be literally and strictly construed and not in liberal terms. In effect, the place rented out is neither a residential dwelling nor being rented out for use as residence.
The hostel accommodation is not equivalent to residential accommodation and hence we hold that the services supplied by the Applicant would not be eligible for exemption under Entry 12 of Exemption Notification No.12/2017-CT(Rate) dated 28.06.2017 and under the identical Notification under the TNGST Act, 2017, and also under Entry 13 of Exemption Notification No.09/2017-IT(Rate) dated 28.06.2017, as amended.
Whether the Applicant is required to register under the GST Act if their aggregate turnover exceeds twenty lakh rupees in a financial year? - HELD THAT:- The Applicant's service of providing hostel accommodation is not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017 as amended, the Applicant is very much be required to take registration under the GST Enactments, as the arrangement between the Applicant and the hostel occupants is liable to be classified as transaction in the course of furtherance of business and hence, as per Section 7(1)(a) of CGST Act, 2017 read with Entry No. 2(b) of the Second Schedule to the CGST Act, the said transaction constitutes "supply" - the Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
What is the applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant? - HELD THAT:- Hotels are meant for a temporary stay (2-5 days) and have lot of facilities and staff, but hostels are used for a longer period and have basic facilities with minimal staff required by the inmates to stay at a reasonable rate. Therefore, hostel services cannot be equated to a hotel accommodation and hotel GST rates cannot be applied to a hostel. Therefore, supply of hostel accommodation services (Tariff heading 9963) is taxable @ 9% CGST + 9% SGST under Sl. No.7(vi) of the above Notification (Sl.No.7 (ix) as per original notification).
Whether the supply of in-house food to hostel inmates is exempt as part of a composite supply? - HELD THAT:- The natural bundle has the characteristic of where one service is the main service and the other services are ancillary services which help in better enjoyment of the main service. Further, there is a single price for the combined services. The principal activity of the Applicant is supply of accommodation Services. While providing such services, the charges are being realised in a consolidated manner for the value of food and other like services rendered. The Applicant has stated that they do not charge separately for the other services provided by them. Thus, the services provided by the Applicant are composite in nature.
As per Section 8 of the CGST Act, 2017, for a Composite supply, the tax rate on the principal supply will be treated as the tax rate on the given composite supply - the Applicant provides a number of services in a composite manner, the hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, will be tax rate for the composite supply provided by them.
Scope of Section 97(2) of the GST Act - HELD THAT:- Thus, no ruling could be issued as the question put forth by the Applicant does not fall under the scope of Section 97(2) of the GST Act.
Conclusion - i) The services by way of providing hostel accommodation supplied by the Applicant are not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017.
ii) The Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
iii) The supply of services by way of providing hostel accommodation falls under Tariff heading 9963 and is taxable @ 9% CGST + 9% SGST under Sl.No. 7(vi) of the Notification No. 11/2017, Central Tax (Rate), dated 28.06.2017.
iv) The hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, is the tax rate for the composite supply provided by them.
-
2023 (9) TMI 1644
Exemption from GST - hostel accommodation being provided by the Applicant to students and working women - qualify to be a residential dwelling for use as residence or not - requirement of registration under the GST Act if aggregate turnover exceeds twenty lakh rupees in a financial year - applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant - supply of in-house food to hostel inmates, composite supply or not - scope of Section 97(2) of the GST Act.
Whether the hostel accommodation being provided by the Applicant to students and working women qualify to be a residential dwelling for use as residence as described in the above entry and thus eligible for exemption or not? - HELD THAT:- The term 'residential dwelling' has not been defined either under CGST Act or under Notification No. 12/2017. However, under the erstwhile service tax law, in paragraph 4.13.1 of the Taxation of Services: An Education Guide dated 20.06.2012', issued by the CBIC, the expression 'residential dwelling has been interpreted in terms of the normal trade parlance as per which it is any residential accommodation, but does not include hotel, motel, inn, guest house, camp site, lodge, house boat, or like places meant for temporary stay - a house/ residential dwelling for occupation contains one or more rooms with one/part of the room being used as kitchen and the other/part as living room etc. But, in the instant case, a single house with two or more rooms where normally a single family resides, is subdivided, and let out to different persons and rent being collected on per bed basis with bundle of other services against a consideration clearly constitutes a business of supplying accommodation services along with ancillary services. Thus, on this count as well, the impugned accommodation thus provided does not qualify as a residential dwelling and thus the question of using the same as residence does not arise.
It is clear that the purpose and objective of the notification is nothing but to avoid taxing residential properties taken on rent by family or individuals and the benefit of exemption is not extended to the premises which do not qualify as residential dwelling for use as residence. Further, unless the twin conditions of 'renting of residential dwelling' for 'use as residence,' being inter-twined and inseparable, are not met, the exemption is not available. As per settled position in taxation laws, especially when exemptions or concessions or benefits are to be availed, the interpretation is to be literally and strictly construed and not in liberal terms. In effect, the place rented out is neither a residential dwelling nor being rented out for use as residence.
The hostel accommodation is not equivalent to residential accommodation and hence we hold that the services supplied by the Applicant would not be eligible for exemption under Entry 12 of Exemption Notification No.12/2017-CT(Rate) dated 28.06.2017 and under the identical Notification under the TNGST Act, 2017, and also under Entry 13 of Exemption Notification No.09/2017-IT(Rate) dated 28.06.2017, as amended.
Whether the Applicant is required to register under the GST Act if their aggregate turnover exceeds twenty lakh rupees in a financial year? - HELD THAT:- The Applicant's service of providing hostel accommodation is not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017 as amended, the Applicant is very much be required to take registration under the GST Enactments, as the arrangement between the Applicant and the hostel occupants is liable to be classified as transaction in the course of furtherance of business and hence, as per Section 7(1)(a) of CGST Act, 2017 read with Entry No. 2(b) of the Second Schedule to the CGST Act, the said transaction constitutes "supply" - the Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
What is the applicable tariff heading and rate of tax for the supply of hostel accommodation services by the Applicant? - HELD THAT:- Hotels are meant for a temporary stay (2-5 days) and have lot of facilities and staff, but hostels are used for a longer period and have basic facilities with minimal staff required by the inmates to stay at a reasonable rate. Therefore, hostel services cannot be equated to a hotel accommodation and hotel GST rates cannot be applied to a hostel. Therefore, supply of hostel accommodation services (Tariff heading 9963) is taxable @ 9% CGST + 9% SGST under Sl. No.7(vi) of the above Notification (Sl.No.7 (ix) as per original notification).
Whether the supply of in-house food to hostel inmates is exempt as part of a composite supply? - HELD THAT:- The natural bundle has the characteristic of where one service is the main service and the other services are ancillary services which help in better enjoyment of the main service. Further, there is a single price for the combined services. The principal activity of the Applicant is supply of accommodation Services. While providing such services, the charges are being realised in a consolidated manner for the value of food and other like services rendered. The Applicant has stated that they do not charge separately for the other services provided by them. Thus, the services provided by the Applicant are composite in nature.
As per Section 8 of the CGST Act, 2017, for a Composite supply, the tax rate on the principal supply will be treated as the tax rate on the given composite supply - the Applicant provides a number of services in a composite manner, the hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, will be tax rate for the composite supply provided by them.
Scope of Section 97(2) of the GST Act - HELD THAT:- Thus, no ruling could be issued as the question put forth by the Applicant does not fall under the scope of Section 97(2) of the GST Act.
Conclusion - i) The services by way of providing hostel accommodation supplied by the Applicant are not eligible for exemption under Entry 12 of Exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017.
ii) The Applicant is required to get themselves registered in the state of Tamil Nadu, if their aggregate turnover in a financial year exceeds twenty lakh rupees.
iii) The supply of services by way of providing hostel accommodation falls under Tariff heading 9963 and is taxable @ 9% CGST + 9% SGST under Sl.No. 7(vi) of the Notification No. 11/2017, Central Tax (Rate), dated 28.06.2017.
iv) The hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, is the tax rate for the composite supply provided by them.
........
|
9911796707
