TaxTMI 
TaxTMI 
TaxTMI 
2018 (4) TMI 938
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....has a "Landside" and an "Airside". The Landside area comprises of Check in counters and Baggage Drops and Airside area has aircrafts for boarding. A passenger crosses over from Landside to Airside by passing through Customs & Immigration area and then through security on to the Boarding Gates for departure. The applicant's concerned retail outlet is in the Security Hold Area on crossing the Customs & Immigrations with the address- Shop No. INS-18, SHA Area, International Departure, Terminal 3, IGI Airport, New Delhi-110037. The said outlet is permitted to function beyond the Customs Area and within the Security Hold Area of the IGI Airport vide an arrangement with the Delhi International Airport Private Limited, dated 06.06.2016. The Concept and Category of the applicant under the said agreement being Retail and Sunglasses and the brand- "Sunglass Hut", which is a retail brand of the International group Luxottica. 4. For the purposes of sale from the said outlet, the applicant procures supplies from the Sunglass Hut brand owner M/s Luxottica India Private Limited, Gurgaon, after payment of Integrated Tax (Inter-State Supply form Gurgaon to Delhi) @ 28% 5. The sunglasses procured ....
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.... such import or is effected by a transfer of documents of title to the goods before the goods have crossed the customs frontiers of India. (3) Notwithstanding anything contained in sub-section (1), the last sale or purchase of any goods preceding the sale or purchase occasioning the export of those goods out of the territory of India shall also be deemed to be in the course of such export, if such last sale or purchase took place after, and was for the purpose of complying with, the agreement or order for or in relation to such export. (4) The provisions of sub-section (3) shall not apply to any sale or purchase of goods unless the dealer selling the goods furnishes to the prescribed authority in the prescribed manner a declaration duly filled and signed by the exporter to whom the goods are sold in a prescribed form obtained from the prescribed authority. (5) Notwithstanding anything contained in sub-section (1), if any designated Indian carrier purchases Aviation Turbine Fuel for the purposess of its international flight, such purchase shall be deemed to take place in the course of the export of goods out of the territory of India. Explanation.-For the purposes of this sub-se....
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....ut of India to a place outside India. 14. The Section 2(23) of the IGST Act, defines 'zero rated supply' as under: "zero-rated-supply" shall have the meaning assigned to it in Section 16. 15. The relevant portion of Section 16 of the IGST Act reads as under: Zero rated supply- (1) "zero rated supply" means any of the following supplies of goods or services or both, namely:- (a) Export of goods or services or both; or (b) Supply of goods or services or both to a Special Economic Zone Developer or a Special Economic Zone Unit. 16. The Section 2(4) of the IGST Act also defines 'customs frontiers of India' as under: "Customs frontiers of India" means the limits of a customs area as defined in Section 2 of the Customs Act, 1962 (52 of 1962) 17. The above definition of 'customs frontiers of India' is on the lines of definition of 'crossing of customs frontiers of India' given in Section 2(ab) of the CST Act, 1956 and which was examined by Supreme Court of India in case of Hotel Ashoka (Indian Tourism Development Corporation Limited). 18. The legal interpretation of the applicant of the above provisions of law vis-a-vis the transaction of the applicant at its retail outlet at ....
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.....-For the purposes of this clause,- (a) the expression "taxes on the sale or purchase of goods" shall mean taxes on sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of inter-State trade or commerce; (b) the expression "taxes on the consignment of goods" shall mean taxes on the consignment of goods (whether the consignment is to the person making it or to any other person), where such consignment takes place in the course of inter-State trade or commerce (ii) Article 286(1) before amendment on 08.09.2016: Restrictions as to imposition of tax on the sale or purchase of goods (1) No law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place- (a) outside the State; or (b) in the course of the import of the goods into, or export of the goods out of, the territory of India. 22. Section 5 of the Central State Tax Act, 1956 "When is a sale or purchase of goods said to take place in the course of import or export.- (1) A sale or purchase of goods shall be deemed to take place in the course of the export of the goods out of the territory of India ....
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.... goods" with its grammatical variations and cognate expressions, means taking goods out of India to a place outside India; (iii) Section 2(23): "zero-rated supply" shall have the meaning assigned to it in section 16; (iv) Section 16(1): "zero rated supply" means any of the following supplies of goods or services or both, namely:- (a) Export of goods or services or both; or (b) Supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone Unit. 25. The relevant provision of the CGST Act, 2017: (i) Section 2(56): "India" means the territory of India as referred to in article 1 of the Constitution, its territorial waters, seabed and sub-soil underlying such waters, continental shelf, exclusive economic zone or any other maritime zone as referred to in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976, and the air space above its territory and territorial waters; 26. The relevant provisions of the Customs Act, 1962 are as follows: (i) Section 2(11): "customs area" means the area of a customs station or a warehouse and includes any area in which imported goods or export goods are ordinari....
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....national Airports to passengers was taking place beyond customs frontier of India, no State Government was competent to levy VAT on such goods. 30. A similar issue was also decided by the Hon'ble Supreme Court in the case of Hotel Ashoka (Indian Tourism Development Corporation Limited). The Hon'ble Supreme Court had examined the issue of levy of VAT on the goods sold from duty free shops. It was observed that under the provisions of Article 286 of the Constitution of India and Section 5 of the CST Act, goods which were sold beyond Customs frontiers of India, the transactions had taken place in the course of import and the State Government was not permitted to levy VAT on such sale or purchase of goods. It was also observed by the Hon'ble Supreme Court that as per Section 2(11) of the Customs Act, the said sale transactions had taken place outside India. 31. The abovementioned decision of the Hon'ble Supreme Court does not appear to be applicable in the present case as in the said case, the Hon'ble Supreme Court had interpreted the scope of Section 2(11) of the Customs Act, 1962 under which "Customs area" were defined. No doubt, the duty free shops may be established beyond the Cu....