2018 (6) TMI 462 - AAR - GST

Company's Tax Rate Ruling Application Rejected Under GST System

The company's application for advance ruling on the tax rate for grain-based extra neutral alcohol under the GST system was rejected. The jurisdictional ... Advance ruling admissibility - Rate of tax on grain based extra neutral alcohol - Proviso to Section 98(2) of the CGST Act, 2017 - bar on admission where question is already pending or decided in any proceedings - Pending departmental proceedings and pending writ as disqualifying factors for admissionAdvance ruling admissibility - Proviso to Section 98(2) of the CGST Act, 2017 - bar on admission where question is already pending or decided in any proceedings - Pending departmental proceedings and pending writ as disqualifying factors for admission - Admission of the applicant's advance ruling application on the rate of tax for grain based extra neutral alcohol - HELD THAT: - The Authority examined the application and the remarks of the jurisdictional officer which recorded that proceedings were pending with the Assistant Commissioner, Nandigama Circle. The applicant conceded that departmental proceedings had been initiated before filing the advance ruling application and had also filed a writ petition in the High Court on the same issue which remained pending. Under the proviso to Section 98(2) of the CGST Act, 2017, the Authority shall not admit an application where the question raised is already pending or decided in any proceedings in the case of the applicant. Applying that bar given the existing departmental proceedings and the pending writ, the application did not satisfy the pre requisites for admission and could not be entertained.Application for advance ruling is rejected on the ground that the question raised was already the subject of pending proceedings and therefore not admissible under the proviso to Section 98(2) of the CGST Act, 2017.Final Conclusion: The Authority rejected the applicant's request for an advance ruling on the rate of tax for grain based extra neutral alcohol because the question was already the subject of pending proceedings (and a pending writ), bringing the application within the proviso to Section 98(2) which bars admission. Issues:- Clarification of rate of tax for grain-based extra neutral alcohol under GST systemAnalysis:The case involved an application for advance ruling by a company engaged in manufacturing grain-based extra neutral alcohol, seeking clarification on the applicable rate of tax under the GST system. The applicant filed Form GST ARA-01 for this purpose. The question raised was whether the alcohol falls under the 18% tax slab, exempted category, or any other tax category. The jurisdictional officer, the Assistant Commissioner of State tax, Nandigama Circle, revealed that certain proceedings were pending against the applicant, which led to a prohibition on admitting the ruling as per Section 98(2) of the CGST Act 2017. This section specifies that an application cannot be admitted if the question raised is already pending or decided in any proceedings related to the applicant under the Act.A personal hearing was scheduled for the applicant, who had initially requested a postponement due to personal reasons. However, during the hearing, the applicant claimed that they had filed the application before receiving a show cause notice, implying that they should be heard. Nevertheless, upon verification of records, it was found that proceedings against the applicant had commenced before the application was filed. Additionally, the applicant had also filed a writ petition on the same issue in the High Court, which was pending. Due to these circumstances and the failure to meet the prerequisites, the application was deemed ineligible for admission under Section 98(2) of the CGST Act 2017 and APSGST Act 2017. Consequently, the application for seeking advance ruling was rejected by the Authority.