TaxTMI 
TaxTMI 
2022 (3) TMI 572
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....Tax Rate- 12% on value 12% on difference between sale price and purchase price considering painting as second hand goods as provided under Rule 32(5) of CGST Rules Cars Old Cars HSN-8703 Tax Rate- 18% on value 18% on difference between sale price and purchase price considering car as second hand goods as provided under Rule 32(5) of CGST Rules and also Notification No. 08/2018 dated 25.01.2018 Jewellery: Old Jewellery: HSN-7113 Tax Rate- 3% on value 3% on difference between sale price and purchase price considering Jewellery as second hand goods as provided under Rule 32(5) of CGST Rules Antique Jewellery of an age exceeding one hundred years HSN-9706 Tax Rate- 12% on value 12% on difference between sale price and purchase price considering Jewellery as second hand goods as provided under Rule 32(5) of CGST Rules Watches: Old Watches HSN- 9101/9102 Tax Rate- 18% on value 12% on difference between sale price and purchase price considering watches as second hand goods as provided under Rule 32(5) of CGST Rules Antique Watches of an age exceeding one hundred years HSN-9706 Tax Rate- 12% on value 12% on difference between sale pr....
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....pplicant on approval basis at mutually agreed price. (ii) On receipt of goods on approval and being satisfied with quality and authenticity of the goods, Applicant will upload the details of goods for online auction. (iii) Goods will remain in Applicant's possession during the agreed period of approval. (iv) Applicant will have a right to retain or return the goods during the approval period. After conveying the approval and confirming purchase of goods, Applicant will sell the goods to buyer (highest bidder) in auction and will issue the sale invoice to the buyer. (v) The ownership of auctioned goods will be transferred from applicant to buyer the sale invoice is issued to buyer by the Applicant. 2.3 Applicant will continue to deal in the goods in which erstwhile business entity was dealing: namely:- • Paintings procured from individual art collectors, artists or other art dealers, • Old jewellery, cars, watches, etc. including vintage cars, • Memorabilia/Collectibles such as clothing, sport equipment, spectacles, accessories, autographs of celebrities and renowned personalities and • An....
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....or "Antiques of an age exceeding one hundred years" in the rate schedule prescribed by Notification 1/2017- C.T.(R), the same should prevail over general entries prescribing HSN code and rates for jewellery, watches, books and other items sold as antiques. 2.9 Applicant, relies on ruling pronounced by MAAR and MAAAR respectively in case of erstwhile business entity wherein the authorities have concurred to above referred classification of goods and applicable tax rates in respect of goods dealt with by Astaguru.com. B. Submissions with respect to valuation of goods: 2.10 Section 15 of CGST Act prescribes for value of taxable supply. Rule 32(5) of CGST Rules provides 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. 2.11 Rule 32(5) of CGST Rules applies to the "Second hand goods" or "....
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.... that a dealer buying second hand or used goods from unregistered persons or non-business entities and selling the same, is not saddled with tax liability disproportionate to value addition done by him in transaction chain. In most cases, margin of such second hand goods dealer is less than the tax leviable on such goods under normal scheme of taxation and hence there is need for such provision. 2.15 Once the goods are second hand or used goods, Rule 32(5) is applicable irrespective of value of such goods and irrespective of nature of such goods. There is no stipulation in the Rule that the goods whose value increases with passage of time is not 'used or second hand goods'. It is a settled jurisprudence that tax authorities cannot read any word or phrase into the legal provisions. 2.16 Applicant, relies on ruling pronounced by MAAR and MAAAR respectively in case of erstwhile business entity wherein the authorities have held that erstwhile business entity is entitled to value majority of its goods at margin (i.e. difference between selling price and purchase price) as provided in Rule 32(5) of CGST Rules and can discharge its GST liability on such margin. 2.17 In vi....
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....t answer) decided by the Honorable AAR and AAAR in case of erstwhile business entity. Considering Ruling by AAR and AAAR as mentioned above classification, valuation and GST rates applicable to following goods dealt with by Applicant may be decided as under: Particulars HSN Code & Tax Rate Valuation as upheld by AAAR for erstwhile business entity Paintings: Bought from individual art collectors HSN-9701 Tax Rate- 12% on value 12% on difference between sale price and purchase price considering painting as second hand goods as provided under Rule 32(5) of CGST Rules Cars Old Cars HSN-8703 Tax Rate- 18% on value 18% on difference between sale price and purchase price considering car as second hand goods as provided under Rule 32(5) of CGST Rules and also Notification No. 08/2018 dated 25.01.2018 Jewellery: Old Jewellery: HSN-7113 Tax Rate- 3% on value 3% on difference between sale price and purchase price considering Jewellery as second hand goods as provided under Rule 32(5) of CGST Rules Antique Jewellery of an age exceeding one hundred years HSN-9706 Tax Rate- 12% on value 12% on difference between sale price and purchase price ....
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.... Applicant will continue to carry on the same business of SAPL (Astaguru.com). 5.3 Vide the subject application, the applicant seeks a ruling in respect of determination of classification, valuation and GST rates applicable to the following goods:- (a) Paintings (Bought from individual collectors). (b) Old Cars. (c) Jewellery (Old jewellery and Antique Jewellery of an age exceeding one hundred years). (d) Watches (Old Watches and Antique Watches of an age exceeding one hundred years). (e) Antique Books. 5.4.1 Earlier, SAPL (Astaguru.com) had also applied for a ruling in respect of determination of classification, valuation and GST rates applicable to the goods mentioned in para 5.3 above, which was decided by this Authority vide Order GST-ARA 86/2018-19/B-7 dated 15.01.2019 wherein it was held as under:- (i) Paintings to be classifiable under Heading 9701 and the applicant to pay GST of 12% on the sale value. (ii) Old Cars:- Motor Vehicles fall under Heading 8703 of the GST Tariff. All the items under 8703 to attract 28% GST except Tariff item 870310 10; Sub-heading 8703 80. However old cars to attract a lower rat....
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....s Authority as mentioned in para 5.4.1 above, SAPL (Astaguru.com) filed an appeal before the Maharashtra Appellate Authority for Advance Ruling as under:- (i) Paintings: The applicant agreed with classification under Heading 9701 and the rate of GST as 12% as given by this Authority but challenged the decision which disallowed to them the benefit of Rule 32(5) of the CGST Rules, 2017 and that the applicant was required to pay tax @ 12% on the sale value of such paintings. (ii) Antique Watches: The applicant agreed with the HSN Code, classification and the tax rate as given by this Authority but challenged the decision which disallowed to them the benefit of Rule 32(5) of the CGST Rules, 2017 and that the applicant was required to pay tax @ 12% on the sale value of such goods. (iii) Antique Jewellery : The applicant agreed with the HSN Code, classification and the tax rate as given by this Authority but challenged the decision which disallowed to them the benefit of Rule 32(5) of the CGST Rules, 2017 and that the applicant was required to pay tax @ 12% on the sale value of such goods. (iv) Antique Books : The applicant agreed with the HSN Code, cl....