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2022 (1) TMI 301 - AAR - GSTMaintainability of Advance Ruling application - Levy of GST - interest free Security Deposit - in case service is Exempt from GST how would be accountable under GST? - HELD THAT - The issue raised in the instant application and the audit objection raised in the audit report are one and the same i.e. applicability of GST on security deposit. Thus first proviso to Section 98(2) of the CGST Act 2017 is squarely applicable to the instant case as all the conditions therein are fulfilled.
Issues:
Admissibility of the application for Advance Ruling under Section 98(2) of the CGST Act, 2017. Analysis: The Applicant, a Proprietorship concern engaged in providing services to DTH broadcasting service providers, filed an application seeking an Advance Ruling under Section 97 of the CGST Act, 2017 and KGST Act, 2017. The questions raised in the application pertained to the applicability of GST on interest-free Security Deposit, the taxability of the service provided, and the accountability under GST if the service is exempt. An audit report highlighted an objection regarding the turnover declared as NIL rated GST turnover, contending it as a security deposit paid to the broadcasting company. During the personal hearing, the Authorized Representative reiterated the facts presented in the application. The Authority noted that the provisions of the CGST Act, 2017 and KGST Act, 2017 are similar, differing only in specific provisions. The issue at hand was the admissibility of the application, governed by the first proviso to Section 98(2) of the CGST Act, 2017, which prohibits admission if the question raised is pending or decided in any proceedings concerning the applicant under the Act. Upon examination, it was found that the question raised in the application regarding the GST applicability on the security deposit was the same as the audit objection. As a result, the first proviso to Section 98(2) of the CGST Act, 2017 was deemed applicable, leading to the rejection of the application as "inadmissible." Therefore, the ruling issued by the Authority was to reject the application as "inadmissible" based on the first proviso to Section 98(2) of the CGST Act, 2017.
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