2019 (8) TMI 1083 - AAR - GST

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 ... Rectification of mistake - error apparent from the face of record - while pronouncing the ruling at para no.06, ARA has ruled that goods listed only at Sr.NO. A, B, C, D, G, H, l, K, M and S essential parts of the ship and entitled to concessional rate of tax at 5%. It appears that goods listed down at Sr. No. J has been erroneously omitted to be included in the above list - HELD THAT:- The issue brought to notice by the applicant by filing of the rectification application dt. 13.11.2018 is verified from the record and order passed by this Advance ruling authority on 18.7.2018. Accordingly we find that the Sr. No. J mentioned in the table of the para 5 under the heading “Observations” of the said order in which the product [equipment like satellite communication / Fleet Board Band are covered under entry 252 of Schedule I of GST Notification No. 01/2017-central tax (rate) dt. 28.6.2017 and liable to GST @5 % which is inadvertently omitted while pronouncing the ruling. The issue raised by the applicant is found correct. This is an apparent mistake in the order. The Authority vested with the power to rectify the advance ruling order under the section 102 of CGST ACT/MGST 2017 rectifies the said mistake which is apparent from the record - thus in the Order, in the answer portion, after alphabet 'I', the alphabet “J” shall be included. 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.