9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (11) TMI 208 - AAAR - GSTScope of advance ruling - AAR obtained the ruling by fraud or suppression of facts - misdeclaration of facts - Exemption from GST - Healthcare services - Composite Supply or not - search proceedings initiated by Gujarat State Tax authorities before the appellant applied for advance ruling - appellant was also issued with GST DRC-01A by the state tax authorities for payment of GST ascertained along with applicable interest and penalty. HELD THAT - The appellant in their application for advance ruling made before the GAAR had at Para 17 of Form GST ARA-01 had ticked on both the options thereby declaring that the question raised in the application is not already pending in any proceedings in the applicant's case under any of the provisions of the Act and not already decided in any proceedings in the applicant's case under any of the provisions of the Act. The appellant was aware of the fact that investigations/proceedings were initiated against them by the Gujarat State Tax department and further three GST DRC-01A Part A all dated 11.02.2020 were also issued by the said department. The questions raised in the Advance Ruling application dated 02.12.2020 and the issue pending in the referred investigation and the proceedings initiated are the same - There can be no doubt that the appellant had indeed not declared/ mis-declared the fact of initiation of proceedings clearly evidenced by GST DRC-01A Part A issued in this case and therefore this is also covered under the scope of the term 'suppression' as defined above. It was encumbent upon the appellant while making application for Advance Ruling, to have declared the true and complete facts, given the provisions of the GST law, in particular Sections 98(2) and 104 of the CGST Act, 2017. The invocation of Section 104 of CGST Act by the GAAR and declaring advance ruling dated 20.01.2021 void ab initio is legal - appeal dismissed.
Issues Involved:
1. Whether the medicines, consumables, and implants used in providing healthcare services to in-patients are considered a composite supply and eligible for exemption under "Health Care Services." 2. Whether the Advance Ruling No. GUJ/GAAR/R/31/2021 declaring the previous Advance Ruling No. GUJ/GAAR/R/11/2021 void ab-initio is legally correct. Issue-wise Detailed Analysis: 1. Composite Supply and Exemption under Health Care Services: - The appellant sought an advance ruling on whether the medicines, consumables, and implants used in the course of providing healthcare services to in-patients, including allied services (room rent, food, doctor fees, etc.), should be considered a "Composite Supply" and thus eligible for exemption under "Health Care Services." - The Gujarat Authority for Advance Ruling (GAAR) initially ruled that these items are part of a "Composite Supply" and are exempt from CGST as per Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. 2. Legality of Declaring Advance Ruling Void Ab-initio: - Chronology of Events: - Proceedings to access the business premises of the appellant were initiated on 04.06.2019, converted into search proceedings on 05.06.2019, and continued till 06.06.2019. - On 11.02.2020, the appellant was issued three GST DRC-01A Part A forms by the Assistant Commissioner of State Tax, intimating the tax ascertained and advising payment. - The appellant applied for an advance ruling on 02.12.2020, and GAAR pronounced the ruling on 20.01.2021. - On 08.03.2021, GAAR received a letter from the Additional Commissioner of State Tax, informing them about the pending proceedings against the appellant before the advance ruling application was filed. - GAAR issued a letter on 09.06.2021 for a personal hearing and declared the previous ruling void ab-initio on 19.07.2021. - Appellant's Arguments: - The appellant argued that there was no fraud, suppression, or misinterpretation of facts on their part. - They contended that the term "proceedings" should only include steps that result in a decision, such as a show cause notice or order, and not mere inquiries or investigations. - They relied on various judgments, including CIT-1 Vs Authority of Advance Ruling and Sage Publication Ltd Vs Deputy Commissioner of Income Tax, to support their contention that mere initiation of an investigation does not bar the jurisdiction of the Advance Ruling Authority. - Findings and Legal Reasoning: - The appellate authority noted that the appellant had indeed suppressed material facts by not disclosing the ongoing investigation and proceedings initiated by the State Tax authorities. - The term "proceedings" was interpreted broadly to include investigation steps, as these are part of the process leading to a decision. - The issuance of GST DRC-01A Part A forms was considered an intimation of liability and part of the proceedings. - The appellant's reliance on previous judgments was found inapplicable as those cases involved different facts and contexts. - The appellant's argument that the show cause notice is the starting point of any proceedings was rejected, as the concept of GST DRC-01A was introduced under GST law, which differs from the previous Central Excise Regime. - The appellant's failure to declare the ongoing investigation was deemed suppression of facts, falling under the definition provided in Explanation 2 under Section 74 of the CGST Act, 2017. Conclusion: - The appellate authority upheld GAAR's decision to declare the previous advance ruling void ab-initio, concluding that the appellant had obtained the ruling by suppressing material facts. The appeal filed by the appellant was rejected, and the ruling dated 19.07.2021 was upheld.
|
