TaxTMI 
TaxTMI 
2019 (4) TMI 1497
X X X X Extracts X X X X
X X X X Extracts X X X X
....f supply of goods or services or both; e. Whether any particular thing done by the applicant with respect of goods or services or both amounts to or results in a supply of goods or services or both, within the meaning of that term; Further, the applicant being a registered person (GSTIN is 08AAAAR0279B1ZU, as per the declaration given by him in Form ARA-01) the issue raised by the applicant is neither pending for proceedings 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 a co-operative society registered under the Rajasthan Co-operative Societies Act, 1953, (Now 2001 and has it's office at Bhawani Singh Road, 'C'-scheme, Jaipur, and is a registered taxable person under the Rajasthan Goods and Service Tax Act, 2017, and Central Goods and Service Tax Act, 2017 vide GSTIN No. is 08AAAAR0279B1ZU. b. That, the applicant deals in trading in various items and providing services as commission agent to other registered Taxable persons. c. That, the applicant carries it's business ac....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ke payment to the Jute Mills/ Transporter/ Survey or son behalf of the applicant, for your ready reference copy of the agreement dated 12/09/2018. k. That, the applicant has been dealing as an "agent" of NAFED in the whole transaction and make payment on procurement of goods whatever it may be either by itself or through Kray Vikray Sahkari Samiti to the farmers. l. That, on procurement/ purchases of gunny bags by NAFED under instruction of the applicant, the applicant make payment to the NAFED and the final payment is made by the NAFED to the sellers. m. That, the Government of India as well as the State Government of Rajasthan both of them have notified through their notification numbers 50/2018 - Central Tax Dated: 13^th September, 2018, and F.12(46)FD/Tax/2017-Pt.-113 dated 13/09/2018 respectively about to deduct tax at source (TDS) on payments or credit on supply of goods as well as service or both on contract to contractors according to section 51 of both the Acts i.e. CGST/RGST, for your ready reference both of them are reproduced hereunder:- Section 51 of the CGST Act:- 51.(1) Notwithstanding anything to the contrary contained in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e applicant being a Co-Operative society registered under the Rajasthan State Co-Operative Society Act, 1953 now consolidated in the Rajasthan Co-Operative Societies Act, 2001 is liable to deduct Tax at Source (TDS) from payment to or credit of KrahVikrah, Sahakari Samiti/RAJFED under Notification No. 50/2018-central tax dated 13.09.2018 for their services of procurement of oilseeds and pulses for the applicant to be supplied by the applicant to its principal NAFED. d. Whether the applicant being a Co-Operative society registered under the Rajasthan State Co-Operative Society Act, 1953 now consolidated in the Rajasthan Co-Operative Societies Act, 2001 is liable to deduct Tax at Source (TDS) from payment to or credit of RAJFED under Notification No. 50/2018-Central Tax dated 13.09.2018 for their services of procurement of gunny bags, transportation, insurance and services of surveyors for the applicant to be supplied by the applicant to it's principal NAFED itself. 3. PERSONAL HEARING In the matter personal hearing was granted to the applicant on 01.03.2019 at Room no. 2.29 NCRB, Statue Circle, Jaipur. Mr. G.N. Sharma, Advocate (Authorised Representative) of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... or services or both". • As per section 2(5) of the CGST Act, 2017, 'agent' means a person, including a factor, broker, commission agent, arhatia, del-credere agent, an auctioneer or any other mercantile agent, by whatever name called, who carries on the business of supply or receipt of goods or services or both on behalf of another. • As per section 2(13) of the IGST Act, 2017, "intermediary means a broker, an agent or any other person, by whatever name called, who arranges or facilitates the supply of goods or services or both or securities, between two or more persons, but does not include a person who supplies such goods or services or both or securities on his own account". • Based on the legal definitions, the traits of an agent, in layman terms, can be determined as mentioned below: An agent is a person engaged in the supply or receipt of goods and/or services on behalf of other (the other person is referred to as the 'principal'). The agent carries on the business of supply and/or receipt of goods and/or services on behalf of the principal. • The applicant is providing service of a commission agent....
X X X X Extracts X X X X
X X X X Extracts X X X X
....arges @ 1% of the value of supply. c. The applicant is raising invoice to NAFED for commissioning charges of itself as well as Kray Vikray Sahakari Samiti @ 1% each on the value of supply. As the applicant as a supplier of goods is raising invoice in his name for further supply thus holding of title of goods is being transferred from NAFED to the applicant. IV. Now in examining whether the activity undertaken is a supply of goods or not, the section 7 of CGST/RGST Act, 2017 which defines supply is reproduced below: 7. (1) For the purposes of this Act, the expression "supply" includes- (a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business; (b) import of services for a consideration whether or not in the course or furtherance of business; (c) the activities specified in Schedule I, made or agreed to be made without a consideration; and (d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ly. One such activity which has been detailed in para 3 of Schedule I (hereinafter referred to as "the said entry") is reproduced hereunder: 3. Supply of goods- (a) by a principal to his agent where the agent undertakes to supply such goods on behalf of the principal; or (b) by an agent to his principal where the agent undertakes to receive such goods on behalf of the principal. It may be noted that the crucial factor is how to determine whether the agent is wearing the representative hat and is supplying or receiving goods on behalf of the principal. Thus, the key ingredient for determining relationship under GST would be whether the invoice for the further supply of goods on behalf of the principal is being issued by the agent or not. Where the invoice for further supply is being issued by the agent in his name then, any provision of goods from the principal to the agent would fall within the fold of Schedule I of the CGST Act. In the instant case, the applicant issues an invoice in his name for further supply to a buyer/ purchaser (as directed by the Principal i.e. NAFED), therefore, this activity is a supply of good....
X X X X Extracts X X X X
X X X X Extracts X X X X
....7. VII. Section 51 of CGST/RGST Act, 2017 has made provision in relation to Tax Deduction at Source (TDS) which is as below:- 51. (1) Notwithstanding anything to the contrary contained in this Act, the Government may mandate,- (a) a department or establishment of the Central Government or State Government; or (b) local authority; or (c) Governmental agencies; or (d) such persons or category of persons as may be notified by the Government on the recommendations of the Council, (hereafter in this section referred to as "the deductor"), to deduct tax at the rate of one per cent. from the payment made or credited to the supplier (hereafter in this section referred to as "the deductee") of taxable goods or services or both, where the total value of such supply, under a contract, exceeds two lakh and fifty thousand rupees: Provided that no deduction shall be made if the location of the supplier and the place of supply is in a State or Union territory which is different from the State or as the case may be, Union territory of registration of the recipient. Explanation.-For the purpose of deduction of tax spec....