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TMI Blog2019 (9) TMI 989X X X X Extracts X X X X X X X X Extracts X X X X ..... n provisions. Therefore, unless a mention is specifically made to any 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, the expression 'GST Act' would mean CGST Act and MGST Act. 2. FACTS AND CONTENTION - AS PER THE APPLICANT The submissions, as reproduced verbatim, could be seen thus- 1. B.G Shirke Construction Technology Private Limited (hereinafter referred to as the "Applicant") is, inter alia, engaged in business of construction of infrastructure projects. The applicant has an aviation chartering division. The applicant is operating aircrafts under non-scheduled operators permit (NSOP). The applicant is duly registered with the Goods and Service Tax Department. A copy of the certificate of registration is enclosed herewith as Annexure 4. 2. The applicant is, in the instant case, intends to sell one of its aircraft to M/s K Air (purchaser). K-Air is registered as Travian Flight Services (P) Ltd. It is a private unlisted nongovernmental company incorporated on 30.06.2006. 3. K-Air wishes to purchase one Hawker 800XP (pre-owned) j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a published time table or with flights so regular or frequent that they constitute a recognisably systematic series, each flight being open to use by members of the public" 2.4 As per Notfn No. 1/2017-CT(Rate) & Notfn No. 2/2017 CT(Rate) dt 28.06.2017, aircrafts other than the ones used for personal purpose will attract GST rate of 5% while aircrafts for personal use will attract GST of 28%. Chapter No 88 of GST Tariff deals provides for the GST rate for aircrafts used for commercial as well as personal use as specified under the notifications mentioned above. 2.5 The issue, in the instant case, is whether K-Air is going to use the chartered flights for purposes other than personal use. Personal use 3.1 First, in the instant case, the applicant submits that the purchaser i.e. K-Air intends to operate only chartered flights. They shall not be operating the chartered flights for personal use. The aircraft sought to be purchased from the applicant is intended to be used only for carrying passengers and for medical evacuation purposes. K-Air intends to use the aircraft sought to be purchased, primarily in providing services of corporate leisure, pilgrimage, cargo chartered flights ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orted at AIR 1935 Bom. 415 = 1935 (4) TMI 17 - BOMBAY HIGH COURT. 3.4 Third, the term "private aircraft" has been defined under Aircraft Rules, 1937. According to Rule 3(43) of the Aircraft Rules, 1937, private aircraft means 'all aircraft other than aerial work aircraft or public transport aircraft'. Section 3(45) of the Act defines public transport aircraft as 'all carriages of persons or things effected by aircraft or a remuneration of any nature whatsoever, and all carriage of persons or things effected by aircraft without such remuneration if the carriage is effected by an air transport undertaking'. Section 3(1 A) defines 'aerial work' as any aircraft operation undertaken for an industrial or commercial purpose or any other remunerative purpose, but does not include operation of an air transport service. In the instant case, the aircraft sought to be purchased is not a private aircraft as defined under section 3(43) under Aircraft Rules, 1937. Thus, the same cannot be intended to be private or personal. 4. In view of the above submissions, it is clear that the dominant intention of the purchaser is not to utilize the aircraft for personal use. Consequently, it would attract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IFICATE/IMPORT OF AIRCRAFT 5.1.1 An applicant desirous of obtaining an NSOP shall first apply for the No Objection Certificate (NOC). The application (eight copies) for this purpose shall be submitted to the Ministry of Civil Aviation, New Delhi in the proforma prescribed in Annexure I, along with a fee of Rs. 1,75,000/- (Rupees One Lakh Seventy Five thousand only to be paid in a manner as prescribed by Director General in favour of the Pay and Accounts Office, Director General of Civil Aviation, Ministry of Civil Aviation, New Delhi. The applicant shall also submit along with his application the particulars of Board Members of the Company in pro-forma given at Annexure II. The applicant should also give the type and number of aircraft proposed to be imported /acquired for the purpose of non-scheduled operations. If the applicant has already finalized the arrangements for procurement of these aircraft, he may furnish the details as per Annexure III. 5.1.2 Along with his application, an applicant for NSOP will be required to submit a project feasibility report as per Annexure V and give a declaration that he complies with the guidelines given in AIC No. 7/2008 dated 30.06.2008 on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operation of non-scheduled air transport services does not require the purchaser to be in actual possession of the aircraft. The use of the word 'proposed to be imported/acquired in Section 5.1.1 clarifies that the same. It is only after an initial NOC is granted by the Ministry of Civil Aviation that the purchaser needs to apply for a NSOP permit within three years. It is only when the purchaser applies for NSOP license that it will require to produce evidence of actual possession of aircraft. The same is also clarified vide section 4 of the Civil Aviation Requirements, 2000 dated 01.02.2010. Relevant extract of the same is reproduced as under for reference "4.2 An applicant for the grant of an NSOP shall: a) be in possession of at least one aircraft, either by outright purchase or on lease (without crew), which shall be registered in India and shall have a valid Certificate of Airworthiness in Normal Passenger Category. b) have a minimum Paid Up Capital as given below. Fleet Strength Minimum Paid up Capital (Rs. in Crores) (i) Upto 2 aeroplanes/helicopters 2.00 (ii) Between 3 and 5 aeroplanes/helicopters 5.00 (iii) Between 6 and 10 aeroplanes/ helicopters 10.00 (iv) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. The Revenue, in the instant case, cannot go beyond the license and propose to deny benefit of serial No.244 of the above notification. The Hon'ble Supreme Court in the case of Titan Medial Systems Private Limited Vs. CC 2003 (15) ELT 254 (SC) = 2002 (11) TMI 108 - SUPREME COURT held thus: 13. As regards the contention that the appellants were not entitled to the benefit of the exemption notification as they had misrepresented to the licensing authority, it was fairly admitted that there was no requirement, for issuance of a license that an applicant set out the quantity or value of the indigenous components which would be used in the manufacture. Undoubtedly, while applying for a license, the appellants set out the components they would use and their value. However, the value was only an estimate. It is not the respondents' case that the components were not used. The only case is that the value which had been indicated in the application was very large whereas what was actually spent was a paltry amount. To be noted that the licensing authority having taken no steps to cancel the license. The licensing authority have not claimed that there was any misrepresentation. Once an ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmonious construction. (5) To harmonise is not to destroy any statutory provision or to render it otiose" ... (underlining supplied) It is well settled that every clause of the statute should be construed with reference to the context and other clauses of the Act, so as, as far as possible to make a consistent enactment of the whole of the statute. A bare mechanical interpretation of words and application of a legislative intent is devoid of concept and purpose will reduce the most of the remedial and beneficent legislation to futility. To be literal in meaning is to see the skin and miss the soul. Words, phrases and rules occurring in a statute are to be read together and not in an isolated manner. The legislation never intends to give one from one hand and take away from other hand. This is precisely what the Revenue seeks to argue in the present case. 4. Thus, in view of the above the applicant submits that the aircraft is not for personal use. Therefore, the applicable rate of GST on it will be 5% and not 28% as contended by the department. 03. CONTENTION - AS PER THE CONCERNED OFFICER The submission, as reproduced verbatim, could be seen thus- "Note on the issue involv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... along with Cess @ 3%. According to the applicant dealer, in this case the intending buyer is going to use this aircraft for non-scheduled operating services je other than personal use. The term non- scheduled operating service is defined as per civil aviation requirement as under Non-Scheduled air transport services (passenger) means air transport services other than scheduled air transport services as defined in the Rule 3 of the Aircraft Rules, 1937, As per Civil aviation rules Scheduled transport service is defined as under (4) "Scheduled air transport service" means an air transport service undertaken between the same two or more places and operated according to a published time table or with flights so regular or frequent that they constitute a recognizably systematic series, each flight being open to use by members of the public; From the above two definitions it is clear that, scheduled transport service operator means, the operator who is doing the Aviation Chartering activity on regular basis. The time schedule, route; destination and frequency of aerial operation on commercial basis is fixed. Whereas those operators who are having aircrafts and they too hire it for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yer is not having/owns any aircraft till date. But he has applied for getting such permit to the competent authority. Here it needs to clarify one aspect that whether after getting such required permit as a non-scheduled service operator from the competent authority, this non-scheduled service operator is barred/deprived from the right to use this aircraft for personal use. If answer to this question is in negative then it can be said that still after getting such permit for non-schedule service operator the aircraft can be used for personal use as and when required. So in this situation the air craft can be used for both the purposes i.e. personal and other than personal and in that situation rate of tax would be 28 % along with cess @ 3%. Till the moment intending buyer M/s K-Air is not getting such permit (NSOP) from the competent authority it cannot be said that the air craft will be used for other than personal use. In view of this the rate of tax will be 28 % along with cess @ 3%. 04. HEARING Preliminary hearing in the matter was held on 24.04.2019. Sh. Bharat Raichandani, Advocate appeared and requested for admission of their application. Jurisdictional Officer Sh. V. K. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt as to the purpose of use of the aircraft that is contemplated to be sold to K-Air. As can be seen from above Serial No. 244 of Schedule I of Notification No. 1/2017-CT (Rate) dated 28.06.2017 is in respect of Other aircraft (for example, helicopters, aeroplanes), other than those for personal use, falling under Chapter 8802 of the GST Tariff and Serial No. 176 of Schedule IV of Notification No. 1/2017-CT (Rate) dated 28.06.2017 is in respect of Aircrafts for personal use, falling under Chapter 8802 of the GST Tariff. Since at this point of time, the intended use of the aircraft to be sold is not known and is only speculated as use, by the applicant, for non-personal purpose by the purchaser we will not be able to answer their question. However we are of the opinion that Serial No. 244 mentioned above will be applicable when the said aircraft will be for other than those for personal use and Serial No. 176 mentioned above will only be applicable if the said aircraft will be for personal use. Hence at this point of time it is not possible for us to answer their question due to lack of sufficient and conclusive information supplied by the applicant. 06. In view of the extensive ..... X X X X Extracts X X X X X X X X Extracts X X X X
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