9911796707
TMI Blog2024 (8) TMI 644X X X X Extracts X X X X X X X X Extracts X X X X ..... e a/w Asit Kumar Dash, Advocate, for the Petitioner. Shri Avinash Kedia, Jr. Standing Counsel (GST, Central Excise Customs), for the Respondent. ORDER This matter is taken up through hybrid mode. 2. Questioning the propriety of the Show Cause Notice dated 27-12-2023 vide Annexure-6 issued under Section 73 of the Central Goods and Services Tax Act, 2017 (for brevity hereinafter referred to as CGST Act ) and summary Show Cause Notice dated 27-12-2023 in Demand-cum-show cause notice prescribed under Rules 100(2) 142(1)(a) of the Central Goods and Services Tax Rules, 2017 (for short hereinafter referred to as CGST Rules ) indicating GST being paid on reverse tax mechanism at lower rate pertaining to the tax period April, 2018 to December, 2018 whereby total liability under the OGST Act and the Central Goods and Services Tax Act, 2017 (hereinafter referred to as CGST Act ) has been shown to have been to the tune of Rs. 3,62,25,709.39, the petitioner attacked the validity of Circular issued by Government of India in Ministry of Finance, Department of Revenue (Tax Research Unit), being CBIC-190354/207/2021-TO (TRU-II)-CBEC, dated 6-10-2021. 3. Fact as adumbrated by the petitioner, M/s. Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Group Service Code (Tariff) Service Description 250 Group 99733 Licensing services for the right to use intellectual property and similar Products 257 997337 Licensing Services for the right to use minerals including its exploration and evaluation 5.3 Column Nos. (3), (4) and (5) were substituted vide Notification No. 31/2017-Central Tax (Rate) bearing F. No. 354/173/2017-TRU [GSR 1273(E)], dated 13-10-2017. After substitution said Entry 17 stood thus : Sl. No. Chapter, Section or Heading Description of service Rate (Per cent) Condition 17 Heading 9973 (Leasing or rental services, with or without operator) *** vii. Leasing of rental services, with or without operator, other than (i), (ii), (iii) (iv), (v) and (vi) above. Same rate of Central tax as applicable on supply of like goods, involving transfer of title to goods - 5.4 Vide Notification No. 27/2018-Central Tax (Rate) bearing F. No. 354/428/2018-TRU [GSR 1271(E)], dated 31-12-2018 under SAC Heading 9973 : Sl. No. Chapter, Section or Heading Description of service Rate (Per cent) Condition 17 Heading 9973 (Leasing or rental services, with or without operator) *** (viia) Leasing or renting of goods Same rate of Central tax as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... %] is effective from 1-1-2019, i.e., the date of publication of notification in the Official Gazette in terms of Section 26 of the Odisha General Clauses Act, 1937 read with Section 2(80) of the OGST Act. 5.7 In spite of the fact that there is no ambiguity in application of rate of tax @ 5% pertaining to the transaction for the tax period from 1-7-2017 to 31-12-2018, based on Circular dated 6-10-2021, which has been issued in consideration of decision of the Appellate Authority for Advance Rulings In Re : Penguin Trading and Agencies vide Order dated 27-12-2023 [2020 (32) G.S.T.L. 228 (App. A.A.R. - GST - Odisha)] and decision of GST Council in its 45th Meeting held on 17-9-2021, the opposite party No. 1 has invoked power under Section 73 contemplating levy of tax @ 18% on SAC 997337, i.e., licensing services for the right to use minerals including its exploration and evaluation . Counsel for the petitioner, while attacking legality of said Circular, submitted that such a Show Cause Notice dated 25-1-2022 is fait accompli and the opposite parties should not have sought to raise demand of differential tax saddling extra burden of tax by levying tax @ 18% [CGST = 9% + OGST = 9%] on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discharged only 5% by misplacing entries in Schedule. 7. Having due regard to the rival contentions and submissions, it is seen that the Circular is the basis for initiation of proceeding under Section 73 of the CGST/OGST Act. Further the Circular itself has mentioned at Paragraph 9.3.3 that the clarification was issued pursuant to recommendation of the Council as there was no specific mention of service by way of grant of mining rights during the period 1-7-2017 to 31-12-2018. If the statement of the Counsel for the opposite parties is accepted and the petitioner is given opportunity to participate in the proceeding there may be every possibility for the proper officer to follow the recommendation of the Council pursuant to which the Circular has been issued by the Central Government which in turn has followed the view of the Appellate Authority for Advance Ruling vide order dated 5-11-2019, in re Penguin Trading and Agencies (supra). This Court is not oblivious of the settled position of law that a substantive right cannot be put to jeopardy by bringing into operation fiscal law with retrospective effect. Reference may be had to CIT Vrs. Vatika Township Pvt. Ltd., (2015) 1 SCC 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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