2021 (3) TMI 574 - AAR - GST

Application Rejected for Non-Compliance with CGST Format Requirements

The application filed by Gujarat State Road Development Corporation Ltd. was rejected by the Authority for Advance Ruling due to non-compliance with the ... Application for advance ruling - prescribed form FORM GST ARA-01 - fee for advance ruling - non-maintainability under Section 98(2) of the CGST/GGST ActApplication for advance ruling - prescribed form FORM GST ARA-01 - fee for advance ruling - non-maintainability under Section 98(2) of the CGST/GGST Act - Whether the applicant's advance ruling application is maintainable where it was not filed in FORM GST ARA-01 though the requisite combined fee was paid. - HELD THAT: - The Authority examined the statutory requirement that an application for advance ruling must be submitted in FORM GST ARA-01 and accompanied by the prescribed fee under Rule 104 read with Section 97 of the CGST Act and corresponding provisions of the GGST Act and Rules. While the applicant paid an aggregate fee of Rs. 10,000 (Rs.5,000 under CGST Rules and Rs.5,000 under GGST Rules), the application was not filed in the prescribed FORM GST ARA-01. The Authority found that compliance with both the prescribed form and the fee requirements is mandatory for maintainability. Non-compliance with the requirement to file in FORM GST ARA-01 renders the application defective and liable to rejection under Section 98(2) of the CGST Act (and corresponding GGST provision). Having found the statutory filing requirement unmet, the Authority declined to address the substantive questions raised by the applicant. [Paras 13, 14, 15, 16]Application rejected as non-maintainable and disposed of under Section 98(2) of the CGST/GGST Act for failure to file in FORM GST ARA-01 despite payment of fee.Final Conclusion: The Advance Ruling application of M/s. Gujarat State Road Development Corporation Ltd. is rejected as non-maintainable under Section 98(2) of the CGST/GGST Act for failure to file the application in the prescribed FORM GST ARA-01 (notwithstanding payment of the combined fee). Issues Involved:1. Whether the service of construction and development of state highway roads provided by GSRDC qualifies as an activity in relation to a function entrusted to Panchayat or Municipality under Article 243G or Article 243W of the Constitution of India.2. Whether the applicant falls under the definition of Governmental Authority or Government Entity.Issue-wise Detailed Analysis:1. Qualification of Services under Article 243G or 243W:The applicant, Gujarat State Road Development Corporation Ltd. (GSRDC), is engaged in the construction and development of state highway roads. The applicant sought clarification on whether these services qualify as activities related to functions entrusted to Panchayats or Municipalities under Article 243G or Article 243W of the Constitution. The applicant argued that their services do not fall under the activities listed in the 12th Schedule of Article 243W or the 11th Schedule of Article 243G. Thus, they concluded that their services do not qualify for the exemption provided to Governmental Authorities under Entry No.3 of Notification No.12/2017-Central Tax (Rate) dated 28.06.2017.2. Definition of Governmental Authority or Government Entity:The applicant further submitted that GSRDC is a wholly-owned entity of the Government of Gujarat, established under the Companies Act, 1956, with the main objective of constructing and developing state highway roads. They argued that GSRDC qualifies as a 'Government Entity' as per Notification No.31/2017-Central Tax (Rate) dated 13.10.2017, which defines a Government Entity as an authority or body set up by an Act of Parliament or State Legislature or established by any Government, with 90% or more participation by way of equity or control, to carry out a function entrusted by the Central Government, State Government, Union Territory, or a local authority.Discussion & Findings:Application Format and Fee:The Authority for Advance Ruling (AAR) noted that the application submitted by the applicant was not in the prescribed format as required under Section 97(1) of the CGST Act, 2017, read with Rule 104 of the CGST Rules, 2017. The applicant did pay the required fee of Rs. 10,000, but the application was not submitted in FORM GST ARA-01, which is mandatory under the CGST Act and Rules.Rejection of Application:Due to the non-compliance with the statutory requirements regarding the application format, the AAR found the application invalid. Consequently, the application was rejected under Section 98(2) of the CGST Act, 2017, for not being filed in the proper form as stipulated by the relevant sections and rules of the CGST and GGST Acts and Rules.Ruling:The application filed by Gujarat State Road Development Corporation Ltd. was rejected as non-maintainable due to the failure to comply with the prescribed application format requirements.