TaxTMI 
TaxTMI 
2021 (1) TMI 588
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.... (2) Providing labour for loading of cargo into containers. (3) Allied services for export and import cargo like: -Lift On/Lift off charges to CFS/Empty Container Yard. -Survey Tally formality for goods loaded in the container. -Obtaining Custom Permission for Self-Sealing. (4) Transportation of cargo/containers from factory/warehouse to CFS/port: -Transportation of Agricultural products: like Rice, tea etc. -Transportation of empty container from CFS/Empty container yard to party warehouses in various locations. (5) Obtaining custom related certificates/clearing: like Bill of Lading, Health Certificate, Non GMO, Pytho etc. with complete documentation for export shipment. 2. The applicant wishes to quote a single consolidated rate(per container) towards the above bundle of services, hence they are seeking clarification as to the classification of services, applicable HSN and rate of GST to be charged. The applicant has asked the following question seeking Advance Ruling on the same: "(1) If we want to provide all above services for a "Single consolidated Rate" as a package, whether such sup....
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.... supposed to provide different types of services as below: i. Clearing of cargo. The applicant will undertake this activity with the help of the CHA services to be provided by applicant's sister concern. ii. Transportation of cargo from the factory to the desired location visa-vis CFS/Port etc. iii. Loading and unloading the cargo into containers with the help of the labourers and equipments. iv. Transportation of empty container from CFS/empty container yard to client's warehouse at various locations. v. Other allied services like: -life on/lift off charges to CFS/empty container yard. -survey tally formality for goods loaded in the container. -obtaining custom permission for self-sealing. vi. Obtaining custom related certificates/clearings such as bill of lading, health certificate, Non GMO, python, etc. with complete documentation for export shipment. 4. The applicant has further submitted that in terms of the agreement, a single rate is to be fixed based on per container for providing all types of above mentioned varied services. The agreement is to stipulate no separate rate for the provision o....
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....o be a composite supply. 5.2 Mixed supply is defined under Section 2(74) of the CGST Act, as under: (74) "mixed supply" means two or more individual supplies of goods or services, or any combination thereof, made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply. Illustration.- A supply of a package consisting of canned foods, sweets, chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be supplied separately and is not dependent on any other. It shall not be a mixed supply if these items are supplied separately; 5.3 Thus for a supply to qualify as 'mixed supply', a crucial condition is that it should be supplied for a single price. In the present case, the supply of subject services in the agreement is made for a single price. The United Kingdom Upper Tribunal (UT) in the case of Honorable Society of Middle Temple v/s. Revenue and Customs Commissioners(2013) UKUT 0250(TCC) gave certain indicative guidelines to determine whether two or more supplies constitute a 'single supply' (composite supply) o....
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....(12) A single supply consisting of several elements is not automatically similar to the supply of those elements separately and so different tax treatment does not necessarily offend the principle of fiscal neutrality. 5.4 The applicant has further stated that in the present case, the following points are noteworthy: Value of the constituent: The applicant gives a consolidated quote to the customer for each supply of service. Intention of the supplier and recipient: The customer may choose to avail the subject services as per their own requirements. In other words, the customers may choose to procure any combination of supply of service from the applicant. This could be considered as a test as it would reveal what the applicant intends to supply, and what the recipient intends to receive vis-a-vis though can be supplied together. Such element also explains the economic rationale behind the supply. Description on the invoice: The applicant has to raise fixed rated consolidated invoice for supply of services and not to provide an item-wise/service wise bifurcation. 5.5 The applicant has stated that the above facts indicate that the intention of the ap....
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....itted that in terms of Section 8(b) of the CGST Act, in case of mixed supply, the supply of two or more supplies shall be treated as a supply of that particular supply that attracts the highest tax; that as provided in facts above, out of all the services in question, few services are taxable whereas few are exempt under GST; that in cases, where all the supplies are liable to GST as the same rate or at differential rate, there is no problem and output tax due can be easily calculated; that, in the present case, there is a mixture of taxable and exempt supply which could lead to problem; that definition of mixed supplies provides for the phrase "two or more individual supplies of goods or services, or any combination thereof"; that unlike the definition of composite supply, which includes only 'taxable supplies", the definition of mixed supply has wide scope as it means to include supplies vis-avis taxable or exempt both; that in view of the above, they are of the view that the subject services including taxable as well as exempt supplies would qualify as mixed supply in terms of Section 2(74) of the CGST Act. 6. The applicant has submitted his view point in respect of Question ....
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....e and address of the recipient and the address of delivery, along with the name of the State and its code and where the value of the taxable supply is fifty thousand rupees or more; (5) Harmonised System of Nomenclature code for goods or services; (6) Description of goods or services; (7) Quantity in case of goods and unit or Unique Quantity Code thereof; (8) Total value of supply of goods or services or both; (9) Taxable value of the supply of goods or services or both taking into account discount or abatement, if any; (10) Rate of tax and amount of tax (central tax, State tax, integrated tax, Union territory tax or cess); (11) Place of supply along with the name of the State, in the case of a supply in the course of inter-State trade or commerce and address of delivery where the same is different from the place of supply. (12) Whether the tax is payable on reverse charge basis; and (13) Signature or digital signature of the supplier or his authorised representative. 6.2 The applicant has stated that as provided in above paras the subject supply pertains to supply of service liable to tax at the ra....
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....ection 39: (emphasis supplied) 7.1 The applicant has stated that in terms of sub-section (2) of Section 16 of the CGST Act, no person shall be entitled to take credit of any input tax in respect of goods or services or both unless he has fulfilled all the following conditions- (a) The registered person should be in possession of tax invoice, debit note or any other tax paying documents as may be prescribed under the rules. (b) The registered person should have received the goods or services or both. (c) Tax should have been deposited with the government. (d) Return prescribed under Section 39 should be filed. 7.2 The applicant has submitted that in the present case, they fulfil all the above referred conditions and thus render themselves eligible to avail the input tax credit with regards to the inward supplies procured for making the subject outward supply; that they are specially concerned about the fact that whether the input tax credit attributable to such supplies which are exempt under GST law will be disallowed to them in view of the fact that the subject supply under the agreement consists of few exempt supplies; that in terms of....
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.... supplies (other than nil rated or fully exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council: Provided further that no refund of unutilised input tax credit shall be allowed in cases where the goods exported out of India are subjected to export duty: Provided also that no refund of input tax credit shall be allowed, if the supplier of goods or services or both avails of drawback in respect of central tax or claims refund of the integrated tax paid on such supplies. 8.1 The applicant has stated that based on the above provision, a registered person may claim refund of unutilised input tax credit at the end of any tax period in case where the registered person makes zero-rated supply without payment of tax. DISCUSSION & FINDINGS: 9. We have considered the submissions made by the applicant in their application for advance ruling, additional submissions made by them dated 19.08.2020 as well as the arguments/discussions made by their representative Shri Hemen Furiya, C.A. at the time of personal hearing. We have also considered the issues involved on which Advance Ruling is s....
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.... independently? Or it shall be treated as "Composite supply"? (2) What shall be the applicable HSN code and corresponding GST Rate for such bundle of services? (Highest Rate of Service in the bundle is 18%). (3) Whether the firm shall be eligible to avail ITC on the following: -Regarding GST paid on Commercial vehicles & Repair & maintenance cost of such vehicles used for transportation of goods/containers. -ITC on inward supply from CFS/Port/Labour contractor etc. related to such packaged outward supply. (4) Whether the Exporter client shall be eligible to claim refund of the GST paid by them on our outward supply invoices?" 13. To begin with, we would like to state here that on the basis of the submission of the applicant as well as the discussions made during the course of personal hearing by the representative of the applicant, it appears that the issue brought before us by the applicant has not yet materialised so far i.e. the application for Advance Ruling has been filed on 13.10.2019 but no agreement has been reached so far by the applicant with the exporter of rice (referred to by them) after nearly a year of filing of the app....
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....long drawn and expensive litigation at a later date. Seeking an advance ruling is inexpensive and the procedure is simple and expeditious. It thus provides certainty and transparency to a taxpayer with respect to an issue which may potentially cause a dispute with the tax administration. However, in the present case, we find that the applicant has asked hypothetical questions seeking Advance Ruling on an issue which has not materialised till date. We find that a period of nearly one year has lapsed after the filing of the application of Advance Ruling by the applicant (which was filed on 13.10.2019) but the agreement which they were supposed to make with the so-called Rice exporter has not materialised so far i.e. no agreement has been signed in this regard and therefore no copy has been submitted to us in the instant case. We fail to understand how the applicant expects the Advance Ruling Authorities to answer or to decide on such hypothetical questions like whether five different services likely to be provided by the applicant in the future, if provided for a single consolidate rate would be mixed supply or composite supply, the HSN of the said supply, whether the firm would be l....