TaxTMI 
TaxTMI 
2021 (1) TMI 1255
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....s `the appellant') against the Advance Ruling No. RAJ/AAR/2021-22/19 dated 21.09.2021 BRIEF FACTS OF THE CASE 3. M/s Harish Chand Modi, 39, Bachchrajji ka bagh, 11^th A Road, Sardarpura, Jodhpur-342003 (herein after referred as appellant) has filed appeal against Ruling issued by Authority for Advance Ruling Rajasthan vide order No. RAJ/AAR/2001-22/19 dated 21.09.2021. The Appellant has submitted appeal in this office in hard copy on 27.10.2021. Fee of CGST Rs. 10000/- and SGST Rs. 10000/- have been paid vide Challan dated 08.10.2021. Brief facts of the case are as under:- 3.1 The appellant is a registered assessee under GST laws having GSTIN -08ACEPM8844J1Z4. The appellant submitted that he had undertaken construction of its building and decided to give different floors or offices of its building on rent or lease. The appellant had entered into an agreement with its tenant. Appellant had given 5,437 sq feet (3,526 sq. ft on 7th floor and 1,911 sq. ft on 6th floor) at its premises "Shanti One", Plot No 39, 11th A Road, Bachrajji ka Bagh, jodhpur-342003 hereinafter referred as "the said premises", to the tenant on lease for a period 9 years and 11 months divided in 9 terms ....
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.... 3.3 The appellant has mentioned sample electricity bill and the manner of reimbursement of electricity charges by tenant. S. No. Details Bill Amount (Rs.) 1 Electricity Charge 36,214.20 2 Fixed Charge 20,250.00 3 Demand Surcharge 4. Power Factor Surcharge (+) Incentive (-) /Shunt capacitor (3%) 108.64 5 Unauthorized Consumption Amount 6 CT/PT/Meter Rent 7 Transformer Rent 8 Other 52.29 9 Rebates (-) (i) Voltage (ii) Solar/Sprinkler/Rural Rebate/Pre-Paid Meter Rebate 10 Total Nigam Dues(Sum of 1 to 9) 56,625.13 11 Electricity Duty 1,636.80 12 Water Conservation Cess 409.20 13 Urban Cess 613.80 14 Other Nigam Dues -548.95 15 Other Electricity Dues 16 Other Water Conservation Cess 17 Other Urban Cess 18 Other LED/Deferred Deposit 19 Adjusted Amount (Code) 20 Total Due Date Amount (Sum of 10 to 19) 58,735.98 21 Arrear Amount 22 Deferred Amount (Active Month) 23 State G....
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....terms. Para 15 .......In view of such an agreement, it can be said that the amount charged towards internal infrastructure (if any separately charged) would be includible by virtue of the clause any amount charged for anything done by the supplier in respect of the supply of goods or services or both'. Had a similar clause been incorporated in the agreement regarding 'electricity charges' the same would have been includible. However, there is no such clause regarding electricity charges. Thus, the tone and tenor of the agreement clearly demonstrates that the value for offering the space on rent has been fixed at Rs. 20,80,848/-. The agreement does not make any provision for the supplier to make any incidental expense or charge any other amount in respect of such supply of space on rent. Thus, the value for the purpose of renting of immovable property, in the instant case, would be the amount agreed upon for the act of renting of such property..... The interpretation taken in the parallel case is applicable in verbatim to our case as the facts are similar. In our case also no such wor....
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....s at actual and the value of renting of the immovable property is a fixed amount specified at clause 3 which becomes the value of supply in terms of the statutory provisions. This finding is squarely applicable to our case which had been wrongly ignored by the learned members of authority for advance ruling Rajasthan and hence the decision passed was bad in law and on fact. Para 16 ......the applicant has not provided a separate electric meter to the lessee in the instant case and as such the lessee cannot make the payment of electric charges directly to the electric company. In such circumstances the applicant makes the payment to the electric company and in-turn collects such charges from the lessee. To make the system work, the applicant have installed sub-meters and they collect the charges of the electric power used by the lessee as per the usage of power ascertained from such sub-meter. Two aspects emerge from the above scheme of arrangement: - The applicant has not obtained separate meter from the electric company to facilitate the direct payment of electricity charges by the lessee to the electric company. - In absence of separate meter, the appli....
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.... 08.12.2021. 6.2 We observe that only issue to discuss by this forum in this appeal is whether the act of recovering electricity expenses by the appellant is covered under the category of pure agent or Not? 6.3 We find that provisions of Rule 33 of the CGST Rules, 2017 are related to pure agent, which are being reproduced here; "33. Value of supply of services in case of pure agent. - Notwithstanding anything contained in the provisions of this Chapter, the expenditure or costs incurred by a supplier as a pure agent of the recipient of supply shall be excluded from the value of supply, if all the following conditions are satisfied, namely, - (i) the supplier acts as a pure agent of the recipient of the supply, when he makes the payment to the third party on authorization by such recipient; (ii) the payment made by the pure agent on behalf of the recipient of supply has been separately indicated in the invoice issued by the pure agent to the recipient of service; and (iii) the supplies procured by the pure agent from the third party as a pure agent of the recipient of supply are in addition to the services he supplies on his own acc....