TaxTMI 
TaxTMI 
2021 (1) TMI 1255
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing 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, 11th 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 of 1 year each and 1 term of 11 months. The tenan....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 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 Gov. Bearer Amount (i) Tariff Subsidy (ii) HailStorm/Other Subsidy 24 Total Amount Before Due Date(SNO 20+21-22-23) 58,736.00 25 LPS 1,121,52 26 Total Amount After Due Date(Sum of 24 and 25) 59,858.00 Total Units Consumed (KWH) 4,092.00 Unit Cost per KWH (Calcula....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e 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 words 'any amount charged for anything done by the supplier in respect of the supply of goods or services or both' have been used with electricity charges and hence the learned members had grossly erred in ignoring such interpretation and holding that GST is payable on electricity charges, consequently the order passed was bad in law and facts. Pa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....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 applicant has installed sub-meter and collects the charge of electric power used by the lessee from the lessee and in-turn pays the same to the electricity company. The facts are similar to our case but the learned members had grossly erred in not interpreting the agreement as "pure agent" for reimbursement of electricity expenses and merely focused on the terms "reimbursement" and "pure agent" ignoring the fact that i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ovisions 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 account. Explanation. - For the purposes of this rule, the expression "pure agent" means a person who - (a) enters into a contractual agreement with the recipient of supply to act as his pure agent to incur expenditure or costs in the course of supply of goods or services or both; (b) neither intends to hold nor holds any title to the goods or services or both so procured or supplied as pure agent of the recipient of supply; (c) does not use for his own interest such ....