TaxTMI 
TaxTMI 
2019 (3) TMI 841
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....nor proceedings were passed by any authority. Based on the above observations, the applicant is admitted to pronounce advance ruling. 1. SUBMISSION AND INTERPRETATION OF THE APPLICANT: a. The Applicant is engaged in the business of selling used lead acid batteries to various manufacturers. b. The Applicant is registered with the jurisdictional authorities under the Rajasthan Goods and Service Tax Act, 2017 ("Rajasthan GST Act, 2017") bearing GSTIN No. 08AAFCS9741J1ZU. c. The Applicant is operating under the Margin Scheme notified under Rule 32(5) of the Central Goods and Service Tax Rules, 2017 ("CGST Rules"). d. The Applicant purchases these used lead acid batteries from unregistered suppliers in small quantity [50 to 100 kg approximately]. The unregistered suppliers may be located in the same State as the dealers or even a different State. On purchase of used lead acid batteries from unregistered suppliers, the Applicant subsequently sells them to various manufacturers and charges GST on the difference between the sale price and purchase price of lead acid batteries in accordance with Rule 32(5) of the CGST Rules. e. It is in this aforesaid background, the Applicant seeks d....
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....arily engaged in the activity of procuring the second hand 'lead acid batteries' (hereinafter referred to as batteries) in small quantities (50 to 100 kg approx.) from various unregistered suppliers situated within the State of Rajasthan and outside Rajasthan. 4. For goods to qualify as second hand goods as per Rule 32(5) of the CGST Rules, 2017 such goods need be (1) used goods as such or goods after minor processing that does not change the nature of goods (2) goods on which no Input Tax Credit has been availed. 5. It is submitted that used lead acid batteries are used goods and no processing is done on such goods. Therefore, these used lead acid batteries qualify as second hand goods in as much as these goods are 'used goods as such'. Further, the Applicant does not avail Input Tax Credit on such used lead acid batteries. 6. In this regard, reference may also be placed on the Press Release dated 15th July, 2017 of the GST Council wherein it has been clarified as under in respect of old and used bottles: Doubts have been raised regarding the applicability of the margin scheme under GST for dealers in second hand goods in general and for dealers in old and used empty bottl....
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....ether selling goods within the state or outside the state will classify the Taxable Supply under Point 3.1 (a) while filing the Return GSTR 3B i.e. outward taxable Supplies h. Applicant's interpretation with respect to third question:- 1. In terms of Rule 2 of the Integrated Goods and Service Tax Rules, 2017, the Central Goods and Service Tax Rules, 2017, for carrying out the provisions specified in Section 20 of the Integrated Goods and Service Tax Act, 2017 shall, so far as may be, apply in relation to integrated tax as they apply in case of central tax. Section 20 of the IGST Act prescribes that the provisions of the CGST Act shall mutatis mutandis apply to various subjects which have been provided under Section 20. The subject pertaining to 'time and value of supply' is also covered under Section 20, hence the rules made under CGST Act in relation to valuation of a supply is applicable to IGST Act as well. 2. Therefore, Rule 32(5) of the CGST Rules, 2017 which provides for Margin Scheme in case of intra-state supplies shall also be applicable in case of inter-state supplies. Therefore, the Applicant is of the view that it is entitled to make inter-state supplies of used l....
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....ON: I. a. We find that, in respect of second hand goods, a person dealing in such goods is allowed to pay tax on the margin i.e. the difference between the value at which the goods are supplied and the price at which the goods are purchased. b. Rule 32(5) CGST Rules, 2017 specifies that where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e. used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored. c. The relevant extract of Section 32(5) of the CGST Rules, 2017 is reproduced below:- "(5) Where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and ....
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....n a supply of goods or services or both, within the meaning of that term. As the query raised by the applicant is not specified in Section 97(2) of CGST Act/RGST Act, 2017, therefore, no advance ruling can be given on this aspect. III. In terms of Rule 2 of the Integrated Goods and Service Tax Rules, 2017, the Central Goods and Service Tax Rules, 2017, for carrying out the provisions specified in Section 20 of the Integrated Goods and Service Tax Act, 2017 shall, so far as may be, apply in relation to integrated tax as they apply in case of central tax. Section 20 of the IGST Act prescribes that the provisions of the CGST Act shall mutatis mutandis apply to various subjects which have been provided under Section 20. The relevant portion of Section 20 of the IGST Act is reproduced as under:- 20. subject to the provisions of this Act and the rules made there under, the provisions of Central Goods and Services Tax Act relating to,- (i) scope of supply; (ii) composite supply and mixed supply; (iii) time and value of supply; (iv) input tax credit; (v) registration; (vi) tax invoice, credit and debit notes; (vii) accounts and records; (viii) returns, other than l....