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of <h1>GST applies to transfer of moulds as supply of goods under CGST Act</h1> <h3>In Re: M/s. Automative Components Technology India Private Limited</h3> In Re: M/s. Automative Components Technology India Private Limited - 2020 (34) G.S.T.L. 619 (A. A. R. - GST - T. N.) Issues Involved:1. Applicability of GST on the transfer of title in moulds from the applicant to the Indian buyer.2. Eligibility of the Indian buyer to take credit of the GST paid to the applicant for the said purchase.Detailed Analysis:Issue 1: Applicability of GST on the Transfer of Title in MouldsThe applicant, engaged in supplying automotive components, proposed a transaction involving the transfer of title in moulds to an Indian buyer. The moulds are manufactured by a foreign supplier in Thailand and remain there, while only the title is transferred to the applicant and then to the Indian buyer. The applicant argued that since the moulds are not physically imported into India, the transaction should not be liable to GST under Section 5 of the IGST Act read with Section 7(5)(a) of the Integrated Goods and Services Tax Act 2017.The applicant further contended that the transaction does not constitute an import of goods due to the absence of physical movement into India. They referenced Section 10(1)(c) of the IGST Act, suggesting that the place of supply is Thailand, and hence, the transaction should not fall within the territorial jurisdiction of the IGST Act.Upon review, the Authority for Advance Ruling (AAR) noted that the definition of 'supply' under Section 7 of the CGST Act 2017 includes the transfer of title in goods for consideration in the course of business. Schedule II of the Act specifies that any transfer of title in goods is a supply of goods. Therefore, the transfer of title in moulds from the applicant to the Indian buyer constitutes a supply of goods, making it liable for GST.Ruling: GST is applicable on the transfer of title in moulds from the applicant to the Indian buyer.Issue 2: Eligibility of the Indian Buyer to Take Credit of the GST PaidThe applicant sought clarification on whether the Indian buyer would be eligible to take credit of the GST paid for the purchase of moulds. However, the AAR clarified that the eligibility of input tax credit at the buyer's end does not fall under the scope of the questions that the Advance Ruling Authority is authorized to address, as per Section 97(2) of the CGST Act.Ruling: The question regarding the eligibility of the Indian buyer to take credit of the GST paid is not answered, as it is outside the ambit of the Advance Ruling Authority.Conclusion:The judgment concluded that GST is applicable on the transfer of title in moulds from the applicant to the Indian buyer. However, the question of the buyer's eligibility to claim input tax credit on the GST paid could not be addressed by the Authority for Advance Ruling due to jurisdictional limitations.
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