TaxTMI 
TaxTMI 
2021 (8) TMI 350
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.... i. Whether the vouchers themselves, or the act of supplying them is taxable, and at what stage, for each of the three categories of transactions undertaken by the applicant? ii. If the answer to the above question is in the affirmative, what would be the rate of tax at which this would be taxable, i.e. which category would this be taxed under? 3. Admissibility of the application: The question is about "whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both, within the meaning of that term" and hence is admissible under Section 97(2)(g) of the CGST Act 2017. 4. BRIEF FACTS OF THE CASE: The applicant furnishes some facts relevant to the issue: 4.1 The applicant is mainly involved in the business of providing Marketing Services. The nature of services provided to each customer depends on the requirement and depends on the tailored agreement with each customer. 4.2 During the course of business the applicant receives orders for supply of e-vouchers wherein the applicant sources e-vouchers for such customers as per the order received and acts as an intermedi....
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....ich deals with the time of supply of goods, reads as follows:- "(4) In case of supply of vouchers by a supplier, the time of supply shall be,- (a) the date of issue of voucher, if the supply is identifiable at that point; or (b) the date of redemption of voucher, in all other cases. (5) Where it is not possible to determine the time of supply under the provisions of sub-section (2) or sub-section (3) or sub-section (4), the time of supply shall,- (a) in a case where a periodical return has to be filed, be the date on which such return is to be filed; or (b) in any other case, be the date on which the tax is paid. 5.3 Vouchers are instruments which are redeemable at their face value for goods or services supplied by either the issuer of the vouchers itself, or another party. As such there exists an obligation to accept them as full or partial consideration for a supply of goods or services or both, as per the CGST Act, 2017. Such instruments which enable payments to be effected between a payer and a beneficiary are governed by the Payment and Settlement Systems Act, 2007 (hereinafter referred to as "the Act"). 5.4 Vouchers,....
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....pply of services". 5.6.2 If Section 2(102) of the CGST Act defines services to mean "anything other than goods, money and securities, but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged" is considered, then the act of supplying vouchers could be a service. The applicant states that since actionable claims are specifically considered supply of neither goods nor services by virtue of Schedule III, this activity by them would have to be fully exempt. 5.7 Money: 5.7.1 The applicant submits that under Section 2(75) of the CGST Act, "money" means Indian legal tender or any foreign currency, cheque, promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance or any other instrument recognized by the Reserve Bank of India when used as consideration to settle an obligation or exchange with Indian legal tender of another denomination but shall not include any currency that is held for its numismatic value. Pursuant to this, the voucher....
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....ed documentation, including the terms and conditions of use of such instrument; It is clearly evident from the definition supra that when there is an obligation to accept the instrument as a consideration or part consideration for a supply of goods or services or both, then such instruments would qualify as vouchers. The payment instruments, in the instant case, squarely would be covered under the definition of "vouchers" as there is an obligation for the acceptor to accept it as consideration or part consideration for a supply of goods or services or both. We have gone through the copy of the agreement entered into between the applicant and Amazon and the agreement between the applicant and HSBC and also Work Order issued by the applicant to HSBC respectively. We find that the applicant has entered into an agreement to provide marketing services to HSBC whereas in the agreement with M/s. Amazon, there is no specific work description for the applicant. We have also gone through the invoices issued to M/s. Milklane and M/s General Mills India Pvt Ltd. We note that the following are the terms and conditions mentioned in the invoices which also hold true for the beneficiaries of....
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....tive programs. 2. Premier Sales Promotions Pvt. Ltd to activate the voucher codes in batches as per confirmation from MILKLANE DAIRY SERVICES PRIVATE LIMITED. 3. Voucher Codes cannot be interchanged (between Milk and Dahi Packs) as they will already be printed on MILKLANE DAIRY SERVICES PRIVATE LIMITED product packaging and these voucher codes will be integrated into Premier Sales Promotions Pvt. Ltd backend 4. This offer entitles the Participant cashback on their Online Wallet or Bank Account Or UPI. The Participant will be responsible for their choice of the cashback transfer method. 5. If the Participant is not a wallet partner registered customer, he/she will be required to register on the wallet partner website or Mobile App to receive the wallet cashback. 6. This offer entitles the Participant cashback on their Online Wallet or Bank Account Or UPI. The Participant will be responsible for their choice of the cashback transfer method. 7. If the Participant is not a wallet partner registered customer, he/she will be required to register on the wallet partner website or Mobile App to receive the wallet cashback. 8. An....
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....licant is supplying these vouchers and they are used as payment instruments for the payment of consideration or part consideration for supply of goods or services, in the hands of the end user. We further observe that the first type of voucher (Gift Voucher) can be categorized under closed PPI, whereas the other two vouchers i.e. "Cash Back Voucher" and "Multiple Options Voucher" are semi closed PPIs. 11. Now we proceed to examine whether the impugned vouchers are covered under "money". In this regard, we invite reference to the definition of 'money' under Section 2(75) of the CGST Act 2017, which is as under:- (75) "money" means the Indian legal tender or any foreign currency, cheque, promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance or any other instrument recognized by the Reserve Bank of India when used as a consideration to settle an obligation or exchange with Indian legal tender of another denomination but shall not include any currency that is held for its numismatic value; The issue is whether the payment instrument dealt in by the applicant is covered under "any other instru....
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....e as affording grounds for relief, whether such debt or beneficial interest be existent, accruing, conditional or contingent;" We find that there are two limbs of the definition. Actionable claims are unsecured debts or it is a beneficial interest in a movable property which can be enforced by the civil courts. We further find that Insolvency and Bankruptcy Code 2016 defines Debt as a liability or obligation in respect of a claim which is due from any person and includes a financial debt and operational debt. We note that vouchers are not covered under "actionable claim" as they are not debt. They have an expiry period. We also rely on the decision of Hon hie Supreme Court of India, in the case of H. Anraj Etc vs Government Of Tamilnadu Etc on 4 October, 1985, where it held as under:- The two entitlements which arise on the purchase of a lottery ticket are of a different character, inasmuch as the right to participate arises in presenti, that is to say it is a choate or perfected right in the purchaser on the strength of which he can enforce the holding of the draw while the other is inchoate right which is to materializes in future as and when the draw takes place depe....
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....owing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply. The Hon'ble Supreme Court of India, in the case of Tata Consultancy Services Vs State of Andhra Pradesh (2004) observed that goods can be tangible or intangible, the test to determine whether property is goods is whether the concerned item is capable of abstraction, consumption & use and whether it can be transmitted, transferred, delivered, stored, possessed etc.. In the instant case the item "voucher" has all the aforesaid capabilities and hence it gets covered under goods, though it is intangible. Further, the Hon hie Supreme Court of India, in the case of Vikas Sales Corporation Vs. CCE (1996), with regard transfer of import licenses held that Import licenses are not actionable claims, they got a monitory value, they are freely transferable and hence they are goods. In the instant case the item "Voucher" is very much similar to "Import license". Thus the impugned vouchers get covered under goods. The product/item in the instant case i.e. voucher is undoubtedly a moveable property and squarely gets covered under intangible goo....