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TMI Blog2022 (7) TMI 1166X X X X Extracts X X X X X X X X Extracts X X X X ..... e of communication of the advance ruling order is 28.06.2019 Clearly the appeal has not been filed within the prescribed time period of thirty days from the date of communication of the order. Whether the appeal filed on 14.02. 2020 is within the condonable period of another 30 days? - HELD THAT:- The Appellate Authority is not a Court and hence the power to condone beyond the prescribed period does not arise - Furthermore, the provisions of Limitation Act, 1963 does not apply to the appeal proceedings before the appellate authority. Since the appeal cannot be allowed to proceed on account of time limitation, the question of discussing the merits of the issue in appeal does not arise - Appeal dismissed. - Order No./01/DAAAR/ 2022-23/2011-2016 - - - Dated:- 23-5-2022 - SMT. MALLIKA ARYA, AND SHRI ANKUR GARG, MEMBER Represented by : Sh. Anjani Kumar Sharma, FCA Ms. Nisha Aggarwal, FCA 1. At the outset we would like to make it clear that the provisions of CGST, Act 2017 and DGST, Act 2017 are part materia and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n for Corporate Social Responsibility (NFCSR) was established at IICA in 2012 to be the apex national institution that aims to build an enabling environment for the corporate sector to work in partnership with the government, non-government and civil society organizations for effective contribution towards sustainable growth and development. It has been provided an initial corpus fund by the Ministry of Corporate Affairs, enabling India to take a leadership position in the area of CSR. The IICA has a specific mandate for the National Foundation on Corporate Social Responsibility (NFCSR) to be the CSR enabler, and to evolve as the apex national level institution that can effectively enable and inform the implementation of the CSR laws and parameters of the country. In order to fulfill this mandate, the NFCSR offers the following facilitation services:- (i) Learning Development (People) through CSR training services and BSE IICA CSR Index (ii) Metadata on CSR (Information) (iii) CSR Implementing Agency Hub (Partners) (iv) Documentation, Assessment Evaluation, Advocacy Dissemination Research (Projects Implementation) (v) Centre of Excellence for Susta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er relationship between the two parties. A transaction cannot become commercial in the absence of any client service provider relationship as there will be no 'consideration' or 'supply' as is necessary for invoking the provisions of GST. It is a settled law that any contract executed as a trustee without any profit or profit motive cannot be treated as an activity in the course or furtherance of business . In order to determine whether there exists 'service provider-client' relationship between the Appellant and the grantee who has assigned the specified jobs stated in the facts to the Appellant, the nature of the amounts paid to the Appellant in consideration of that assignment is very much vital and decisive. A client must not only pay the actual expenses of the service but also the consideration or reward for the service to the service provider. There is a fundamental difference between a service against which an invoice is raised and a service contract under which funds are spent/recovered as per a predetermined budget. In the former the service provider charges a predetermined amount against services irrespective of the actual expenditure. In the latt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... towards discharge of its Corporate Social Responsibility (CSR) below:- a) The IICA had entered into MoU with AICL on 03.08.2016 and conducted a comprehensive baseline and need assessment survey with regard to 50 villages in 5 states and as a result, IICA submitted a detailed project report (DPR) to the MCL for the following broad activities to be executed towards discharge of its Corporate Social Responsibility (CSR) for the financial year 2016-17. through IICA, as: (i) Installation, transportation, maintenance and upkeep of Solar Street lights. (ii) Installation, transportation, maintenance and upkeep of Solar Water pumps. (iii) Construction of household toilets as per government's Swachh Bharat Gramin design, with comprehensive awareness building and training of community for use and maintenance of toilets. (iv) Healthcare encompassing doctor's consultancy and basic medicine supplies for 1 year. b) Consequently, AICL gave its consent for implementation as per the following details from the detailed project report: (i) Installation of solar water pumps - 122 in Nos; (ii) Installation of solr lights -1230 in Nos; (iii) Sanitation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er actual without any possibility of a surplus, profit motive or any direct or indirect benefit. Further, the charitable nature of the Appellant as well as the impugned activities is not under question. The Advance Ruling Authority has failed to understand the nature of the memorandum of understanding and had ignored the various clauses which establish that it is a non business grant contract. The Advance Ruling authority has ignored the above clause wherein it is stated that any unspent balance shall be returned back to the donor. If a grant is received with the condition of total utilization as per actuals and the unspent balance is subject to refund then such contracts are trusteeship contracts in the nature of legal obligation. 4.2.1 The AAR failed to appreciate that GST Act would not apply even if there is a 'supply' or `consideration' unless the activity is proved to be towards 'furtherance of business'. In this case there was no case for treating the activity as a business activity for two reasons: (i) the contract clearly established that it was a trusteeship contract as per the principles laid down the Supreme Court. (ii) there was no findin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by a taxable person. e) Supply should be a taxable supply. f) Supply should be made within the taxable territory. 4.2.4 It was also submitted that while these six parameters describe the concept of supply, there are a few exceptions to the requirement of supply being made for a consideration and in the course or furtherance of business. GST is essentially tax only on commercial transactions. Hence only those supplies that are in the course or furtherance of business qualify as Supply under GST. This aspect `whether the contract can be considered as towards furtherance of business has not been discussed and this aspect has also not been disputed either. Therefore, in the light of a statutory provisions and the judicial precedence the impugned contract remains a grant contract for charitable purposes not covered within in the scope of GST by virtue of the requirement of section 2(17)(a) regarding furtherance of business. 4.3 Ground No. 3: That the Advance Ruling is bad in law as the Appellant received legal obligation in fiduciary capacity, which cannot be treated as a business or commercial activity for the purposes of GST. All the contracts of the Appellant are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4.3.2 It was also submitted that IICA is a trustee of funds and unspent balance shall be returned back to the donor. The AAR Delhi had failed to establish that whether the activity could be treated towards furtherance of business under section 2(17)(a) of GST Act. Unless these fundamental issues are resolved one cannot go into the 'exemptions' and the applicability of terms such as 'supply' and `consideration', which become relevant only if it is established that IICA was engaged in the course or furtherance of business and the amount received was not a grant even after applying the principles laid by the Supreme Court of India in Apitco (supra). The Hon'ble Delhi High Court reaffirmed that any grant with specific direction from the donor cannot be treated as income, DIT vs. Society for Development Alternatives [2012] 18 Taxmann.com 364 (Delhi). In this case assessee had received grants for specific purposes/projects from the government, non-government, foreign institutions etc. These grants were to be spent as per the terms and conditions of the project grant. The amount, which remained unspent at the end of the year for got spilled over to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 2017. 7.2 Before doing so and getting into the discussion on this issue, we find that there appears to be a delay in filing the appeal and hence we will examine this issue first and only then move forward for deciding the issue raised in the Appeal. 7.2.1 We find that in terms of Section 100 of the CGST Act, 2017 an appeal should be filed within 30 days from the date of communication of the advance ruling order that is sought to be challenged. However, the Appellate Authority is empowered to allow the appeal to be presented within a further period not exceeding 30 days if it is satisfied that the Appellant was prevented by sufficient cause from presenting the appeal within the initial period of 30 days. In the Form ARA-02, the Appellant has stated that the date of communication of the advance ruling order is 28.06.2019 Clearly the appeal has not been filed within the prescribed time period of thirty days from the date of communication of the order. The question arises whether the appeal filed on 14.02. 2020 is within the condonable period of another 30 days. 7.3 For this we need to establish when the advance ruling order No 08/DAAR/2018 dated 28.06.2019 was commun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... henticate and to make effective Acts, Rules, Orders and Notifications made known to the Public at large. Scrutiny of the Delhi Gazette: Extraordinary reveal that the same was uploaded on 05.09.2019 at 22:51:27 and period has to be reckoned from 5th September, 2019. The Advance Ruling Order was passed on 28.06.2019 vide 08/DAAR/2018 and was received by the Appellant on 28.06.2019 whereas appeal was filed against the advance ruling order on 14.02.2020. These are undisputed facts on record. Taking the date of Notification for the purpose filing of appeal i.e. 05.09.2019 as the cutoff date, the appeal was required to be filed by 04.10.2019. The condonable period by the appellate authority expired on 04.11.2019. Consequently, the filing of the Appeal on 14.02.2020 falls beyond the powers conferred under proviso to section 100(2), of CGST Act, 2017. It is a settled provision of law that law assists those that are vigilant with their rights, and not those that sleep thereupon. The law of limitation in India identifies the need for limiting litigation by striking a balance between the interests of the state and the litigant. 7.6 To buttress our stand that the appeal is hit by limita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y only upto 30 days after the expiry of 60 days which is the normal period for preferring appeal. Therefore, there is complete exclusion of Section 5 of the Limitation Act. The Commissioner and the High Court were therefore justified in holding that there was no power to condone the delay after the expiry of 30 days period. Emphasis applied 7.6.1 The aforesaid ruling of the Hon'ble Supreme Court is squarely applicable to the facts of the case. It is evident that this Appellate Authority being a creation of the statue is empowered to condone the delay of only a period of 30 days after the expiry of the initial period for filing appeal. As far as the language of section 100 of the CGST Act, 2017 is concerned, the crucial words are not exceeding thirty days used in the proviso to sub-section (2). Further, we are of the opinion that to hold that this Appellate Authority could entertain this appeal beyond the extended period under the proviso would render the phrase not exceeding thirty days wholly otiose. No principle of interpretation would justify such a result. For this reason too, the case of Land Acquisition Collector Vs. State of J K (1997) 2 SCC 107 is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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