TaxTMI 
TaxTMI 
2022 (6) TMI 192
X X X X Extracts X X X X
X X X X Extracts X X X X
....ount received by Executive Council of insurers from the Life Insurance Council and General Insurance Council are also exempt from GST At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression 'GST Act' would mean CGST Act and MGST Act. 2. FACTS AND CONTENTION - AS PER THE APPLICANT FACTS: The submissions made by M/s. Executive Council of Insurers, the applicant are as under:- 2.1 The applicant is a Quasi-Judicial authority established under Redressed of Public Grievances Rules 1998 & Ombudsman Rules, 2017, framed by the Central Government and notified in Gazetted vide GSR 670 (E) on 11/11/1998. This is an administrative body set up to facilitate the functioning of offices of Insurance Ombudsmen in India. 2.2 As per Insurance Ombudsman Rules 2017, the life Insurance Council and the General Insurance Council should coll....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Learned D.R. in Para 7 has stated 3 parameters but failed to appreciate the fact that two main ingredients out of the same i.e. "consideration" and "being in the course of furtherance of business" are absent in the case for Advance Ruling. What is rendered by the applicant may be a service, but for the purposes of GST laws to make it taxable, it has to fulfill all criterions mentioned therein. The definition and explanation cannot be read in part, clause wise but has to be read as a whole to arrive at a logical conclusion. (ii) The concerned officer has concluded that funds received from insurance company are covered under definition of 'consideration' paid for the supply of services as they come under the scope of 'by any other person'. It is very much necessary that 'consideration' has to be mutually decided upon between supplier of service and recipient of service, irrespective of the fact that it may be paid by recipient or any other person. In case on hand, no charges, court fee etc. are to be paid the applicant when approached for grievance redressal. Thus, there is no element of consideration for the services given by the applicant. Since the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....any business at all. Applicant relies following Supreme Court decision for this submission. State Of Tamil Nadu And Another vs Board of Trustee of the Port of Madras decided on 26 March, 1999 [4 SCC 630] [114 STC 520] wherein Supreme Court has stated, "That brings us finally to the question whether the Port Trust was established under the Major Port Trusts Act, 1963 for 'carrying on business'?. The observations of this Court in Trustees of Port of Madras vs. M/s Aminchand Pyarelal & Others [1976 (1) SCR 721] in connection with the earlier Madras Port Trust Act were strongly relied upon by the learned senior counsel for the respondent - Port Trust. It was observed as follows: "Port Trusts do not do the business of warehousing goods and the rates which the Board charges for storage of goods are not levied as a means of collecting revenues. The Board is under a statutory obligation to render services of various kinds and those services have to be rendered not for the personal benefit of this or that importer but in the larger national interests." The above observations clearly show that Port Trusts are not established for carrying on business.". The applicant submits ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....currency or denomination for which a separate consideration is charged. 3.7 Applicant acting as quasi-judicial forum, is providing services to aggrieved persons by resolving their disputes with insurance companies, who, being party to such disputes are also availing the services of Ombudsman. And as per Rule 17(8) of Insurance ombudsman Rule, the award of insurance Ombudsman is binding on the insurer. Hence activity of applicant is 'supply of service'. 3.8 For 'Supply of services' to come under the scope of supply, such supply shall be made or agreed to be made for consideration. Consideration is defined under CGST Act in section 2(31) as below (31) "Consideration" in relation to the supply of goods or services or both includes- (a) any payment made or to be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but shall not include any subsidy given by the Central Government a State Government; (b)..... 3.9 Applicant has claimed that they are receiving funds from 58 insurance companies through Life Insurance Council and General Insur....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y Commr, MUM-VAT-D-919 was also present. 4.2 The application was admitted and called for final e-hearing on 12.04.2022. The Authorized representatives of the applicant, Shri. Kiran Garkar, CA & Smt. Poornima Gaitonde, Secretary were present. The Jurisdictional officer Shri. Prashant Nerkar, AC-MUM-VAT-D-919, was also present. 05. OBSERVATIONS AND FINDINGS: 5.1 We have gone through the facts of the matter, documents on record and submissions made by the applicant as well as the jurisdictional officer. 5.2 The applicant has submitted that they are an administrative body set up to facilitate the functioning of officers of Insurance ombudsman in India which decides on complaints filed by any person who has a grievance against insurer. 5.3 The first thing to find out in the subject case is, whether there is any supply rendered by the applicant in the subject case and if it is found that the applicant is undertaking a supply, then in such a case whether there is a supply of goods or services or both. Hence, we reproduce and discuss the relevant Sections of the CGST Act, 2017 herein below. 5.4 Section 7(1) of CGST Act which deals with scope of supply reads as follow (1) For the pu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....goods or services or both includes- (a) any payment made or to be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but shall not include any subsidy given by the Central Government a State Government; (b)............. 5.8 Although the applicant has claimed that they do not receive any fess from the aggrieved complainants, we observe that, applicant receives funds from Life Insurance & General Insurance Councils. These funds are received by the applicant to perform their activities, by way of managing their salaries and other administrative expenses, which have already held to be a supply of services. Even though the aggrieved persons do not pay any fees to the applicant, and the amounts are received from Life Insurance and General Insurance Council, we can say that, in the subject case, the consideration for the impugned supply of services, instead of being paid by the aggrieved complainants are being paid by the said Councils/ insurance companies and satisfy sub-section (a) of the section 2 (31) of the CGST Act 2017 i.e the consideration in the....