Authority rectifies error in GST classification, includes equipment as essential part, corrects concessional tax rate

The Authority rectified an error in an Advance Ruling order regarding the classification of certain equipment as essential parts of a ship for GST purposes. The rectification application highlighted the omission of the equipment from the list of essential parts entitled to the concessional tax rate of 5%. The Authority acknowledged the mistake as a typo-error and rectified it under section 102 of the CGST Act and MGST Act, 2017, directing the inclusion of the equipment in the list eligible for the concessional tax rate.

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Issues: Rectification of an error in the Advance Ruling order regarding the classification of certain equipment as essential parts of a ship for GST purposes.

Analysis:
The case involved a rectification application filed by M/s. A.S. Moloobhoy Private Limited regarding an error in the Advance Ruling order passed under section 98 of the Central Goods and Services Tax Act and the Maharashtra Goods and Services Tax Act, 2017. The error pertained to the classification of equipment listed at Sr. No. J (SAT-C/FBB- Satellite communication/Fleet Board Band) as an essential part of the ship under entry 252 of Schedule 1 of CGST Notification No. 01/2017-Central Tax (Rate) and liable to GST at 5%. The applicant pointed out that while the equipment at Sr. No. J was included in the observation part of the order, it was erroneously omitted from the list of essential parts entitled to the concessional tax rate of 5% in the ruling. The Authority acknowledged the mistake as a typo-error apparent from the record and agreed to rectify it.

Upon verification of the rectification application and the original order, the Authority confirmed that the equipment listed at Sr. No. J was indeed covered under entry 252 of Schedule I of GST Notification No. 01/2017-central tax (rate) and should have been included in the list of essential parts of the ship eligible for the concessional tax rate of 5%. The Authority recognized the inadvertent omission of Sr. No. J from the list while pronouncing the ruling, thereby confirming the error highlighted by the applicant. The mistake was deemed to be apparent in the order, warranting rectification under section 102 of the CGST Act and MGST Act, 2017.

Consequently, the Authority, in the exercise of its power to rectify advance ruling orders, issued a rectification order on 19.12.2018 to correct the mistake. The rectification order directed the inclusion of the alphabet 'J' after alphabet 'I' in the answer portion of the original order, thereby rectifying the error in the classification of the equipment as an essential part of the ship eligible for the concessional tax rate of 5%. The rectification aimed to align the ruling with the actual decision and ensure the accurate application of GST provisions to the equipment in question.

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