2018 (6) TMI 462 - AAR - GST

Company's Tax Rate Ruling Application Rejected Under GST System

IN RE: M/s CRUX BIO TECH INDIA PRIVATE LIMITED

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 ... Maintainability of Advance Ruling Application - Clarification of rate of tax - grain based extra neutral alcohol - Whether the grain based extra neutral alcohol comes under 18% or exempted or any other taxes category in GST tax system? - Held that:- On verification of the record submitted by the jurisdictional authority, it was found that the proceedings were initiated well before the filing of application before this authority. Further, the applicant himself admitted that they have preferred writ petition No.7734/2018, dt 07.03.2018 before the Hon'ble High Court of Judicature at Hyderabad on the same issue which is pending for disposal. As the application do not qualify the pre-requisitions, the application will not qualify for admission as per Section 98(2) of CGST ACT2017/APSGST Act, 2017 - the application filed by applicant for seeking advance ruling is here by 'Rejected'. 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.