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TMI Blog2018 (9) TMI 975X X X X Extracts X X X X X X X X Extracts X X X X ..... I provisions? 1.3 If GST is not payable separately on the excess length, whether the Company is required to reverse proportionate credit to the extent of supply such excess length? At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act /MGST Act would be mentioned as being under the "GST Act". 02. FACTS AND CONTENTION - AS PER THE APPLICANT STATEMENT OF THE RELEVANT FACTS HAVING A BEARING ON THE QUESTION(S) ON WHICH THE ADVANCE RULING IS REQUIRED 1. This Application is being preferred by Sterlite Technologies Limited, Maharashtra ("Company"/"Applicant"), a company incorporated in India under the provisions of the Companies Act, 1956 having its registered office at E-1, E-2,E-3, MIDC Waluj, Aurangabad-431136, Maharashtra, India. 2. The Applicant is engaged in providing goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er has placed an order and agreed to pay) is considered as 'usable quantity' whereas the actually supplied quantity (which is marginally surplus than the standard length-not usable) is known as 'delivered quantity'. Customers of the Company are entitled to avail Input Tax Credit ("ITC") of GST charged on OF which also includes the cost of excess length. The customers sell the non-usable/not marketable OF as scrap on payment of applicable GST. 8. It is pertinent to note that the price charged to the customers has been arrived for delivered quantity keeping in mind the usable quantity. That is to say, price for the usable quantity is arrived at by including cost of manufacturing excess length on which the GST liability has been discharged. 9. However, owing to absence of any consideration earmarked for difference between delivered quantity and usable quantity in case of supplies made to independent customers, dispute may arise with respect to correctness of the Transaction value and provisions of Central Goods and Services Tax Rules, 2017 ("CGST Rules") concerning valuation of supply to include cost of manufacturing excess length in the Transaction Value to determin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e issues for determination raised by the taxpayer has been placed before Authority of Advance Ruling, only after initiation of investigation by the preventive officers of GST Commissionerate, Aurangabad on the basis of searches conducted on 02.04.2018 and 03.04.2018 and consequent follow-up actions conducted by the department including statements of the key persons recorded under Section 70 of the CGST Act, 2017. In this connection, your attention is invited towards proviso to Section 98 of the CGST Act, 2017, (similar provision has been given in proviso to Section 98 of the Maharashtra GST Act, 2017), wherein it is specifically provided that "the Authority for Advance Ruling shall not admit the application where the question raised in the application is already pending or decided in any proceedings in the case of an applicant under any of the provisions of this Act" In view of the express provisions given in the CGST Act, 2017 and Maharashtra GST Act, 2017, the application submitted by the taxpayer before the Authority for Advance Ruling, shall not be entertained and deserved to be rejected out rightly at the admission stage only." Further, during the course of investigation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to declare before Authority of Advance Ruling, in para 17 of form GST ARA-01 that whether question raised in the application is already pending or decided in any proceedings in applicant's case under any provisions of the Act. The fact that the case has been booked against the taxpayer on the said issue in the month of April 2018 i.e. well before making this application, which is under investigation, needs to be co-related with the declaration submitted by the taxpayer in form GST ARA-01. The admissibility of the application may be dealt with accordingly and any mis-declaration made by the taxpayer may be taken up as per provisions of the Act. It is also pertinent to mention here that the taxpayer at nowhere in the invoices issued have mentioned that the cost of excess length is already included in prices charged to customers. The prices charged to the customers are as per purchase orders placed by customers and only towards the invoiced quantity and not for excess lengths. It is imperative to mention here that though the taxpayer falls under the administrative control of State of Maharashtra, the searches were conducted on the basis of specific information and necessary inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ociate Manager of Sterlite Technologies Ltd provided the information of search undertaken by Central GST office, Aurangabad: to ascertain the facts, I wrote letter to Hon. Joint Commissioner (Preventive) GST and Central Excise. Aurangabad. In this regard, in the reply, I received a letter from Mr. A.G. Sable, Assistant Commissioner (Preventive) GST and Central Excise, Aurangabad and he furnished the information about the investigation action taken during 02/04/2018 to 03/04/2018 by Central GST office. Hence, it is clear that M/s. Sterlite Technologies Ltd. (GSTIN k7AAEC58719BIZC) has applied in Form GST ARA 01 before Hon. Authority for Advance Ruling only after initiation of investigation by the Preventive officers of CGST office, Aurangabad on basis bf searches conducted on 02/04/2018 and 03/04/2018. Hon. Sir, in this connection, your attention is invited towards proviso to Section 98 of the CGST ACT 2017 (similar provision has been given in proviso to section of the Maharashtra GST Act 2017) wherein specially provided that: "The Authority for Advance Ruling shall not admit the application where the question raised in the application is already pending or decided in any proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereas the actually supplied quantity (which is marginally surplus than the standard length-not usable) is known as 'delivered quantity'. Customers of the Company are entitled to avail Input Tax Credit ("ITC") of GST charged on OF which also includes the cost of excess length The customers sell the non-usable/not marketable OF as scrap on payment of applicable GST. 3. The applicant submitted that, it is pertinent to note here that owing to global standard practices, OF is strictly required to be used in specified lengths (e.g. in the multiples of 2.1 kilometre/2.2 kilometre). However, due to practical challenges explained herein below it is not feasible to manufacture the OF at the exact length of standard specification. 4. We find that various hearings with respect to admission or rejection of the application have been held on various dates and details of the same are already produced above. 5. During the course of hearing, we find that jurisdictional officers have raised the objection with regard to admission of this advance ruling application and requested that it is to be rejected as the same issue is pending before the investigation authority on the same questions as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o have been initiated against them until Show Cause Notice is issued to them is not tenable in view of the very clear position that Show Cause Notice is a form of charge memo/charge sheet filed which is a culmination of inquiry and investigations that have been undertaken in the case. 10. In view of the detailed factual position in respect of present case put before us it is very clear that proceedings under the relevant provisions of this Act are initiated in respect of the application prior to their filing of this application for Advance Ruling. 11. We find that Section 98 of the CGST Act provided as under: Section 98- Procedure on receipt of application 98. (1) On receipt of an application, the Authority shall cause a copy thereof to be forwarded to the concerned officer and, if necessary, call upon him to furnish the relevant records: Provided that where any records have been called for by the Authority in any case, such records shall, as soon as possible, be returned to the said concerned officer. (2) The Authority may, after examining the application and the records called for and after hearing the applicant or his authorised representative and the concerned officer or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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