TaxTMI 
TaxTMI 
2020 (11) TMI 528
X X X X Extracts X X X X
X X X X Extracts X X X X
....Dhanbad (hereinafter referred to as BCCL) on 15.10.2015 for maintenance of 4 nos. of Electric Rope Shovel, supplied by the appellant. As per para 9.2.1 of the agreement, a foreign MARC-holder shall be entirely responsible for all taxes, duties, licence fees and such other levies imposed outside BCCL's country. The foreign supplier shall also be responsible for all taxes & duties in BCCL's country legally applicable during execution of the contract. The appellant raised invoices against BCCL inclusive of tax. Payment was not made till 2018 owing to problem in the payment channel which necessitated the appellant to open a branch in India in 2018 and they got registration under the Central Goods and Services Tax Act, 2017/ the West Bengal Goods and Services Tax Act, 2017 (hereinafter referred to collectively as "the GST Act") on 25.10.2018 with GSTIN 19AAFC10569J1Z9. The payment against first batch of invoices raised by them towards BCCL were received at the bank account of the branch, opened in India. The batch of invoices under MARC was raised in May, 2019. However, BCCL required them to revise the invoices by reducing the tax element paid by BCCL under reverse charge mechanism. Acc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ST, and the supplier of service as stated in the invoice ought to have been considered as a concluding document for determining the location of supplier of service. c) Advance Ruling order has erroneously relied on the terms of clause 9.2.2 of the MARC to conclude that the branch office of the appellant in India is the domestic MARC holder, and therefore be liable to pay tax. It was also ignored that the branch office of the Appellant was operating at the exclusive instructions of the appellant, and was primarily acting as a mere collection and disbursement centre for payment to be received from BCCL and its onward transfer to the appellant in Russia. The opening paragraph of the MARC clearly stipulated the appellant as the MARC holder. Also, the term 'domestic MARC holder' has not been defined anywhere in the MARC, and is only used in clause 9.2.2. It is a settled position of law that the liability to make payment of tax cannot be determined merely on the basis of a clause under an agreement, more so, when the factual position and documentary evidences clearly establish a contrary position. The documentary evidence placed on record along with detailed factual submissions ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ablishment in India. The said small change in the manner of collection of payment by the appellant cannot be concluded as a material factor for treating branch office as the supplier of service. 6. During the course of hearing the Appellant reiterated their submissions and added that the Branch Office was created only to facilitate and support the Russian company, as the job is in India. No contract was entered between IZ Kartex India and BCCL and thus, BCCL may not accept an invoice issued by IZ Kartex India. They added that the registration is not in the name of IZ Kartex India. The appellant also stated that they are not providing service occasionally to BCCL and hence there was no possibility to take registration as a casual provider of service under GST. 7. The respondent raised a few issues and sought clarification from the appellant which are as follows : a) The appellant does oiling and testing of samples in the premises of BCCL. They have taken registration as a 'foreign company' and not as a "casual taxable person" or "non-resident taxable person". The definitions of the casual taxable person and non-resident taxable person is applicable to persons who do n....
X X X X Extracts X X X X
X X X X Extracts X X X X
....aced reliance on the decision Commissioner of Customs (Import), Mumbai vs. Dilip Kumar and Company & Ors., [C.A. 3327 of 2007] = 2018 (7) TMI 1826 - SUPREME COURT wherein a constitution bench of the Hon'ble Supreme Court has held that a person claiming exemption, .., has to establish that his case squarely falls within the exemption notification, and while doing so, a notification should be construed against the subject in case of ambiguity. To this, the appellant submitted that the instant case does not relate to claiming exemption and therefore the cited decision of the Hon'ble Apex Court is not squarely applicable here. 8. The matter is examined and written and oral submissions made before us are considered. 9. It is seen that BCCL, the party to the MARC other than the appellant is already paying GST liabilities. It has been submitted by the appellant in their application for Advance Ruling that the foreign company raised its invoices on BCCL and did not charge any GST on the same. BCCL has made payments after deducting 18% towards GST on the plea that the liability for payment of GST falls on the foreign company. As per the relevant provisions of the GST law, no foreign c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....' as referred above : "fixed establishment means a place (other than the registered place of business) which is characterised by a sufficient degree of performance and suitable structure in terms of human and technical resources to supply services, or to receive and use services for its own needs." In the above definition, it is clear that the registered place of business cannot be termed a fixed establishment. Here, the domestic entity IZ-KARTEX is registered with GST authorities and hence, going by the definition, it cannot be termed a fixed establishment. In that sense, the decision of the WBAAR does not hold good in legal terms. Also, the WBAAR has not adduced any finding to draw conclusion that IZ-Kartex as registered in India maintains suitable structures in terms of human and technical resources to provide the service for which the MARC has been entered into between the parties. Further, the findings of the WBAAR mentions that "it is evident ... that the MARC holder maintains suitable structures in terms of human and technical resources at the sites of BCCL." This finding is somewhat different from what is required to declare the MARC holder a fixed establishment....