2017 (10) TMI 255 - SC - GST

Supreme Court directs Monitoring Committee to aid lessees in claiming input tax credit for minerals purchased in e-auctions

The Supreme Court directed the Monitoring Committee to assist lessees in claiming input tax credit under the Central Goods and Services Tax Act, 2017 for ... Input tax credit under the Central Goods and Services Tax Act, 2017 - payment of GST on sale value in e-auction by buyer directly to the lessee - lessee's compliance obligations under the GST law - Tax Identification Number on invoices - ceiling/cap - requirement for precise stand and prayersInput tax credit under the Central Goods and Services Tax Act, 2017 - payment of GST on sale value in e-auction by buyer directly to the lessee - lessee's compliance obligations under the GST law - Tax Identification Number on invoices - Direction to enable lessees to claim input tax credit and mechanism for payment and compliance in respect of GST on minerals sold in e auction. - HELD THAT: - The Court directed the Monitoring Committee to take necessary action so that the lessee may claim and obtain input tax credit under the Central Goods and Services Tax Act, 2017. It was ordered that the GST payable on the sale value of mineral purchased in the e auction shall be paid by the buyer directly to the lessee, and the lessee shall be responsible for all compliances as required under the Act. The Monitoring Committee was further directed to prepare an appropriate proforma and to ensure that the Tax Identification Number of the respective lessees is carried on the invoices as may be required for compliance and credit availment.Monitoring Committee to implement mechanism for direct payment of GST by buyers to lessees, ensure lessee compliance under the CGST Act, 2017, and prepare proforma including Tax Identification Numbers on invoices; I.A. No.56590 of 2017 disposed of.Ceiling/cap - requirement for precise stand and prayers - Requirement for the Union of India to clarify its precise stand and prayers regarding the ceiling/cap issue. - HELD THAT: - The Court observed contradictory stands taken by the Union of India in two sets of applications filed by the Ministries concerned. In view of that contradiction, the Court called for a clear and precise statement of the Union's stand and the exact prayers with regard to the ceiling/cap. The Court directed that the requisite application reflecting the precise position be filed by the specified date for further consideration.Union of India to file a precise application stating its stand and prayers on the ceiling/cap by 10th October, 2017; I.A. Nos.72931 and 83141 listed for hearing on that date.Final Conclusion: The Court directed implementation steps to enable lessees to claim input tax credit under the CGST Act, 2017 - including direct payment of GST by buyers to lessees, lessee compliance, and invoice proforma with Tax Identification Numbers - and adjourned consideration of the ceiling/cap issue pending a precise stand from the Union of India to be filed by 10 October 2017. Issues:1. Input tax credit under the Central Goods and Services Tax Act, 2017 for mineral purchased in e-auction.2. Contradictory stand by the Union of India regarding the ceiling/cap in applications filed by the Ministry of Steel and Mines.Analysis:1. The Supreme Court directed the Monitoring Committee to facilitate lessees in claiming input tax credit under the Central Goods and Services Tax Act, 2017 for minerals purchased in e-auctions. The court specified that the GST payable on the mineral sale value should be paid directly by the buyer to the lessee, who would be responsible for all necessary compliances. The Committee was instructed to prepare appropriate proforma and ensure proper Tax Identification Numbers on invoices for lessees.2. Regarding the contradictory stands presented in applications by the Union of India through the Ministry of Steel and Mines, the Court sought clarity on the Union's precise stance and prayer concerning the ceiling/cap issue. The Union was directed to file the necessary application clarifying their position before the next hearing scheduled for 10th October, 2017. Various other applications related to the case were also listed for specific dates in October for further consideration and proceedings.