2021 (9) TMI 319 - AAR - GST

Classification of supply - principal supply of fishing boats and vessels - classifiable under HSN Code 8407 taxable at 5% GST rate or not - Goods of supply under HSN code 8409, 8483, 8902, 8487, 8501, 8502, 8415, 8418, 8413 which is also supplied to fishing boats and vessels mainly - applicability of circular No.52/26/2018-GST - HELD THAT - The applicant has stated that they are providing complete sales Service Support to all their customers and have multiple Service Centers/trained manpower across the Coastline for the same, whereas during hearing it was informed that they have not carried on this activity Pre-GST regime and also they don't have any purchase orders at present. In the case at hand, the applicant has stated that they have been established in March 2020 for the proposed supplies but had not furnished any documentary evidence to substantiate their proposed supply in the form of any Purchase Order from any class of recipient, List of goods to be supplied or any documentary evidence to prove the proposed business of the applicant, i.e., any correspondences with the proposed principal suppliers with whom they intend to enter into transactions or agreements/Purchase orders for further supply. In this situation, without the specifics of the proposed supply, substantiated with the material facts, this authority is constrained to rule on the applicability of the said entry to the proposed transactions, based on the clarification in the Circulars and the rulings extended by the Advance Ruling authorities of Kerala, Maharashtra, etc. Therefore, without material evidence for the proposed supply, no ruling is extended on the clarifications sought by the applicant.

Summary

Issues Involved:
1. Applicability of 5% GST rate for supply under HSN Code 8407 when the principal supply is for fishing boats and vessels.
2. Comparison of GST liability for HSN 8407 with HSN 8408, which attracts 5% GST when supplied to fishing boats and vessels.
3. Applicability of 5% GST rate for goods supplied under HSN codes 8409, 8483, 8902, 8487, 8501, 8502, 8415, 8418, and 8413 when supplied to fishing boats and vessels.

Detailed Analysis:

1. Applicability of 5% GST Rate for HSN Code 8407:
The applicant sought clarification on whether the supply of goods under HSN Code 8407 for fishing boats and vessels qualifies for a 5% GST rate. The ruling noted that the applicant had not provided sufficient documentary evidence, such as purchase orders or agreements with suppliers, to substantiate their claims. The ruling emphasized that without specific details and material facts of the proposed supply, it is not feasible to determine the applicability of the 5% GST rate under Notification No. 01/2017-Central Tax (Rate) dated 28.06.2017.

2. Comparison of GST Liability for HSN 8407 with HSN 8408:
The applicant referenced earlier Advance Rulings and a circular from the Ministry of Finance, which state that HSN 8408 attracts a 5% GST rate when supplied to fishing boats and vessels, despite being listed under the 28% GST slab. The applicant queried why the same rationale could not be applied to HSN 8407 marine engines. The ruling reiterated that the GST rate for HSN 8407 is 28% as per Notification No. 01/2017 dated 28.06.2017, and without substantive evidence of the proposed supply, no ruling could be extended.

3. Applicability of 5% GST Rate for Other HSN Codes:
The applicant sought clarification on whether goods supplied under HSN codes 8409, 8483, 8902, 8487, 8501, 8502, 8415, 8418, and 8413, when supplied to fishing boats and vessels, could also be taxed at 5% GST as per the circular. The ruling highlighted that the applicant failed to provide documentary evidence such as purchase orders or agreements to support their claims. The ruling stressed that Advance Ruling is applicable only to the applicant and their jurisdictional authority based on the material facts of the transactions. Therefore, without specific and substantiated evidence of the proposed supply, no ruling could be provided.

Conclusion:
The ruling concluded that no specific ruling could be extended due to the lack of material evidence and documentary support for the proposed supplies. The authority emphasized the necessity of detailed and substantiated documentation to determine the applicability of the 5% GST rate for the specified HSN codes when supplied to fishing boats and vessels.