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TMI Blog2019 (12) TMI 1331X X X X Extracts X X X X X X X X Extracts X X X X ..... es or both are liable to GST or not. The aforesaid provision does not enable us to determine the place of supply of any goods or services or both. Hence, the Appellant has misinterpreted the provision of section 97(2)(e) ibid - it is discernible that there is clearly dispute in the interpretation by the Appellate Authority and that of the Appellant with regard to section of the CGST Act, 2017. Since there is dispute in the interpretation of the legal provisions of section 97(2)(e) of the CGST Act, 2017, which certain leaves the scope for argument and debate, there is absolutely no question of any error apparent from the face of record, as was being made out by the Appellant - the allegations, made by the Appellant with regard to the error crept in the impugned order which is apparent from the face of record, is without any rationale, and hence do not merit consideration. Application rejected. - MAH/AAAR/SS-RJ/26A/2018-19 - - - Dated:- 11-12-2019 - SMT. SUNGITA SHARMA, AND SHRI RAJIV JALOTA, MEMBER PROCEEDINGS (under Section 102 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017) A. At the outset, we would l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... likarajun Bhavanappa Tirumale [AIR (1960) SC 137] = 1959 (9) TMI 52 - SUPREME COURT (ii) T.S. Balaram, ITO vs. Volkart Bros. [(1971) 82 ITR 50 (SC)] = 1971 (8) TMI 3 - SUPREME COURT (iii) Sir Hari Shankar pal and Another Vs. Anath Nath Mitter and others [1949 FCR 36] = 1949 (1) TMI 8 - FEDERAL COURT (iv) Parsion Devi and Others Vs. Sumitri Devi and Others [1997 (8) SCC 715] = 1997 (10) TMI 369 - SUPREME COURT (v) Ruling pronounced by CESTAT in the case of Dinkar Khindria Vs. CCE, New Delhi, 2000 (38) RLT 442;2000 (118) ELT 77 (T-LB) = 2000 (3) TMI 76 - CEGAT, NEW DELHI Here, the Appellant had placed emphasis on principle of law laid out in the abovementioned case of Sir Hari Shankar pal and Another Vs. Anath Nath Mitter and others [1949 FCR 36] = 1949 (1) TMI 8 - FEDERAL COURT , wherein the Hon ble Federal Court had observed as under: That a decision is erroneous in law is certainly no ground for ordering review. If the court has decided a point and decided it erroneously, the error could not be one apparent on the face of the record or even analogous to it, When, however, the court disposes of a case without adverting to or appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said pronouncements of this Court that, apart from the fact that Circulars issued by the Board are binding on the Department, the Department is precluded from challenging the correctness of the said Circulars even on the ground of the same being inconsistent with the statutory provision. The ratio of the judgment of this Court further precludes the right of the Department to file an appeal against the correctness of the binding nature of the Circulars. Therefore, it is clear that so far as the Department is concerned, whatever action it has to take, the same will have to be consistent with the Circular which is in force at the relevant point of time. It was further submitted by the Appellant that the Circular issued by the Department under section 168(1) of the CGST Act, 2017 Shall be operative retrospectively if the Circular is beneficial to the Assessee. So as to support the aforesaid submissions, they relied on the Supreme Court Judgment [2007 (208) E.L.T. 321(S.C.)] = 2007 (1) TMI 4 - SUPREME COURT in the matter of Suchitra Components Ltd. Vs. CCE, Guntur, wherein the Hon ble Apex Court held that Beneficial Circular to be applied retrospectively while the oppressiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... questions of law , and interpretation of the expressions: intermediary intermediary services and the scope of section 97 (2) (e) of the CCGST Act: determination of liability to pay tax 2. It was submitted that, in the present case, the statute did confer wide and untrammeled jurisdiction under section 97 (2) (e) of the SGST Act, to determine the liability to pay tax on the impugned transaction of service, that is, decide whether it is within the taxable territory or not , and whether liable to tax ; but this Honorable Appellate Authority passed an abortive AAAR Order dated 22.03.2019 = 2019 (11) TMI 475 - APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA sidestepping its jurisdiction on a narrow ground that the section 97 (2) does not enumerate determination of place of supply and as such no opinion can be given either by the AAR or AAAR, who are functionaries under the SGST Act, and not under the CGST Act . 3. It was then submitted that jurisdiction to determine liability to pay tax can extend to and encompass determination of all related Questions of law and fact as laid down by the Five Justices Constitution Bench in Smt. Ujjam Bai Vs. Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax officers as it may deem fit, and thereupon all such officers and all other persons employed in the implementation of this Act shall observe and follow such orders, instructions or directions. (C) At that stage a request was made to grant a few days time to submit appropriate case law. Request was graciously granted. Accordingly, the Applicant /Appellant submit the following case laws to substantiate its submissions. Well settled Legal Position: 7. There are two aspects: (a) Whether the Order passed by a statutory authority (AAAR) is liable to be corrected/rectified based a ruling of the High Court / the Supreme Court handed down on a date subsequent to the date the Order to be rectified is passed? Answer : The law declared by the Hon. Supreme Court or The Jurisdictional High Court Operates Retrospectively Case Laws: (i) In M.A. Murthy vs. State of Karnataka [2003] 185 CTR 194 (SC) = 2003 (9) TMI 76 - SUPREME COURT , the Honourable Court has held as under: Normally, the decision of this Court enunciating a principle of law is applicable to all cases irrespective its stage of pendency because it is assumed that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n be initiated based on the contrary view taken by the jurisdictional High court or Supreme Court on a date subsequent to the date of passing of the Order proposed to be rectified. BOARD S CIRCULARS: BINDING ON THE DEPARTMENT: 8. The second aspect is whether on the parity of reasoning, the application for rectification can be moved based on the Board clarificatory Circular issued under section 168 of the CGST Act, 2017, which is in nature? (a) In this context, it is necessary to refer to the law laid down by the Honourable Supreme Court on the question of binding nature of such type of Circulars issued under the provisions of the statute. While the decision/s quoted below are under Section 37B of the Central Excise Act, 1944, the same would hold good because the new Section 168 (1) of the CGST Act, 2017 is in identical terms, and reads: SECTION 168. Power to issue instructions or directions. - (1) The Board may, if it considers it necessary or expedient so to do for the purpose of uniformity in the implementation of this Act, issue such orders, instructions or directions to the central tax officers as it may deem fit, and thereupon all such officers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng or existing law, has to be read as extant on the date of the impugned Order dated 22-03-2019 = 2019 (11) TMI 475 - APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA , and if the said order is not in conformity with the law/circular, then surely, it is liable to be amended to be brought in line with the law/circular. Additional submissions filed on 06.12.2019 10. A Post-Hearing Brief Note dated 27th November 2019 was submitted taking a two-pronged stand that the impugned Order dated 22-03-2019 = 2019 (11) TMI 475 - APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA ex-facie demonstrated grave and serious errors of law: (1) failure to exercise Jurisdiction to determine liability to pay tax, (2) non-consideration of binding CBIC Circular dated 18th July 2019, clarifying and expounding meaning and true scope of the expression: intermediary services , which had direct bearing on the case in hand. 11. It was urged that in the interest of justice, the impugned Order dated 22nd March 2019 be amended , called -back, and the case re-considered in the light of the Circular of 18th July 2019. 12. Thereafter, a shocking development took place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es for the making of rules with retrospective operation the rules made pursuant to that power can have prospective operation only. 18. The administrative/executive order cannot be made effective retrospectively. The question of the retrospective effect of an administrative order had been the subject of discussion in a number of cases. 19. In the case of State of Haryana v. Dev Dutt 1970 SLR 776 such a question came for consideration before the Court and it was held that administrative order takes effect from the date it is communicated to the person concerned. 20. Similar principle was enunciated in the case of Harbhajan Singh v. State of Punjab 1975 SLWR 483 and it was observed that the administrative/executive order is effective from the date of communication or otherwise published in appropriate manner. 21. The administrative/executive orders and circulars are made to meet with the exigencies of a particular time or situation. They do not fall in the line of Rules and Regulations framed under any Act or the Constitution of India. As such the administrative/executive orders passed at a particular time to meet a particular situation would be effective only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is very clear from the facts of transaction that the applicant is neither providing services nor supplying the goods on their own account. 19. Even applicant at point no 5 of their submission have clearly mentioned that the services provided by them in the instant case would be termed as taxable services under the GST Regime because they do some activity for which monetary consideration that is Commission amount is received by them. 20. As per section 13(8}(b) of the IGST Act 2017 the place of Intermediary Services shall be the location of the supplier of services. In this case the applicants place of supply of services is in taxable territory the said intermediary services cannot be treated as export of services under the provisions of the GST laws. 21. The said intermediary services cannot be treated as export of services under the provisions of GST laws. 22. In order to classify as export of services as per section 2(6) of the IGST act 2017 one of the crucial conditions as contained under sub section (iii) the place of supply of service should be outside India. In this case the place of supply shall be the location of the supplier of services and therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tory the supply of service shall be treated as intra state supply. 29. As per intra state provisions contained in section 8(2), the said provisions are subject to the provisions of section 12 of the IGST act. As per section 12, the provisions of section 12 would be applicable only for determining the place of supply of service where the supplier of services and the location of recipient of the services is in India. When the recipient is located outside India the said provisions of section 12 cannot be made applicable. Provisions of section 8(2) are inter linked with provisions of section 12, the same cannot be made applicable in case the recipient of service is located outside India. 30. In order to decide both the issues raised by the appellant place of supply of services provided would have to be decided. The applicant considering himself as an intermediary has asked for a ruling on whether the services qualify to be an export or intra state supply and these questions demand an examination of place of supply of the services. In order to answer both these questions we will first have to examine our jurisdiction laid out in section 97(2) of the CGST act 2017 as reproduced bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the advance ruling. For the said purpose, they cited few judicial pronouncements, which are being mentioned herein below: (i) Satya Narayan Laxmi Narayan Hegde Vs. Malikarajun Bhavanappa Tirumale [AIR (1960) SC 137] = 1959 (9) TMI 52 - SUPREME COURT (ii) T.S. Balaram, ITO vs. Volkart Bros. [(1971) 82 ITR 50 (SC)] = 1971 (8) TMI 3 - SUPREME COURT (iii) Sir Hari Shankar pal and Another Vs. Anath Nath Mitter and others [1949 FCR 36] = 1949 (1) TMI 8 - FEDERAL COURT (iv) Parsion Devi and Others Vs. Sumitri Devi and Others [1997 (8) SCC 715] = 1997 (10) TMI 369 - SUPREME COURT (v) Ruling pronounced by CESTAT in the case of Dinkar Khindria Vs. CCE, New Delhi, 2000 (38) RLT 442;2000 (118) ELT 77 (T-LB) = 2000 (3) TMI 76 - CEGAT, NEW DELHI 34. Having relied upon the above cited judgments, it was submitted by the Appellant that the Appellate Authority for Advance Ruling had committed an error apparent on the face of records, as it did not apply its mind to the true meaning purport of the expression intermediate services and without discussing its ramifications on the issue at hand, disposed of the case declaring that it has no jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d section 2(47) of the CGST Act, 2017. While Schedule Ill to the CGST Act, 2017 enumerate the activities or transactions which shall be treated neither as a supply of goods nor a supply of services, goods and services, which have been declared exempt supply are notified by the Notification No. 2/2017-C.T. (Rate) dated 28.06.2017 and Notification No. 12/2017-C.T. (Rate) dated 28.06.2017 respectively. Therefore, we are of the opinion that provision of section 97(2)(e) of the CGST Act, 2017 gives us the jurisdiction to decide whether any goods or services or both are liable to GST or not. The aforesaid provision does not enable us to determine the place of supply of any goods or services or both. Hence, the Appellant has misinterpreted the provision of section 97(2)(e) ibid. in much as they believe that the said provision confers on the Advance Ruling Authority or the Appellate Authority for the Advance Ruling the jurisdiction to determine even the place of supply in respect of goods or services or both. Thus, it is discernible that there is clearly dispute in the interpretation by the Appellate Authority and that of the Appellant with regard to section of the CGST Act, 2017. 37. N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 715] = 1997 (10) TMI 369 - SUPREME COURT , it was held as under: - Under Order 47 Rule 1 CPC a judgment may be open to review inter alia if there is a mistake or an error apparent on the face of the record. An error which is not self-evident and has to be detected by a process of reasoning can hardly be said to be an error apparent on the face of the record justifying the Court to exercise its power of review under Order 47, Rule 1 CPC. In exercise of the jurisdiction under Order 47, Rule 1 CPC it is not permissible for an erroneous decision to be reheard and corrected . There is a clear distinction between an erroneous decision and an error apparent on the face of the record. While the first can be corrected by the higher forum, the latter only can be corrected by exercise of the review jurisdiction. A review petition has a limited purpose and cannot be allowed to be an appeal in disguise . Similar views are expressed by a Larger Bench of the Appellate Tribunal (CESTAT) in the case of Dinkar Khindria v. CCE, New Delhi, 2000 (38) RLT 442; 2000 (118) E L.T. 77 (T-LB) = 2000 (3) TMI 76 - CEGAT, NEW DELHI has held that rectification of mistake is by-no means an ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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