TaxTMI 
TaxTMI 
2022 (12) TMI 807
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....pter XVII of the Act shall be binding only,- (a) On the applicant who had sought it in respect of any matter referred to in sub-Section (2) of Section 97 for Advance Ruling; (b) On the concerned officer or the jurisdictional officer in respect of the applicant. 3. Under Section 103 (2) of the Act, this Advance Ruling shall be binding unless the law, facts or circumstances supporting the original Advance Ruling have changed. 4. Under Section 104 (1) of the Act, where the Appellate Authority finds that Advance Ruling pronounced by it under sub-Section (1) of Section 101 has been obtained by the appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab-initio and thereupon all the provisions of this Act or the rules made thereunder shall apply to the appellant as if such Advance Ruling has never been made. Subject: GST - Appeal filed by M/s. Sri Avantika Contracts (I) Limited, 610-B, Nilgiri Blocks, Aditya Enclav, Ameerpet, Hyderabad- 500 016 under Section 100 (1) of TGST Act, 2017 Against Advance Ruling TSAAR Order No. 05/2021, dated 05.08.2021 passed by the Telangana State Authority for Advance Rulin....
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....t of Maldives entered into a memorandum of understanding for construction of a Police Academy. As per this MOU the Government of India has awarded the work relating to planning, designing and execution of the project to National Buildings Construction Corporation Ltd., New Delhi. Sri Avantika Contractors Ltd., are in turn awarded the sub-contract to construct the said building by National Buildings Construction Corporation Ltd., New Delhi. 6. Evidently Sri Avantika Contractor Ltd., have not entered into any contract with Government of Maldives for carrying out the said construction. Further they do not have any privity with respect to the MOU between the Government of Republic of India & Government of Maldives. Therefore the applicant does not have any mutual or successive relationship with the Government of Maldives. Hence Government of Maldives is not the recipient of any service from the applicant. 7. Further an agreement is reached by National Buildings Construction Corporation Ltd., (NBCCL) New Delhi & Sri Avantika Contractor Ltd to construct the building at Addu City in Maldives. Hence Sri Avantika Contractor Ltd., is supplier of the service of the works contract and Nation....
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....d is contested on the following grounds:- 1. The impugned order is passed without proper appreciation of the GST law holding that the supply made by the appellant is within the ambit of GST. The 1st respondent erred in giving a finding that place of supply is in India and hence the appellant is liable to GST without properly appreciating the facts and correct legal position that if the supply is neither intra state nor inter-state, no GST can be levied on the same. 2. Levy of GST depends on the place i.e., situs of tax event. In a consumption-based tax like GST, the tax goes to a place where the goods or services are consumed. CGST, SGST and IGST are accordingly levied basing on the place of supply, location of recipient of the supply and the location of the supplier. Hence, to substantiate the contention that supply of service by the appellant is neither inter-state nor intra-state and hence not taxable and is outside the purview of GST and laws of India, it is to be proved that:- (a) The location of the supplier or the location of the recipient are outside India. (b) The supply of service is in relation to immovable property. (c) The place of supply is outside India. 3....
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....le structure in terms of human and technical resources. In terms of sub-section 15 (b) of Section 2 of IGST Act, 2017, when a supply is made from a place other than registered place of business, then location is that of the fixed establishment from where the supply is made and in terms of (c) of Section 2 of IGST Act, ibid, when a supply is made from more than one establishment, whether the place of business or fixed establishment, the location of establishment most directly concerned with the provision of the supply is to be treated as location of supplier. 5. The appellant has an established office in Maldives which is re-registered under the laws of Maldives and is considered a branch or project office of the appellant. There is no dispute that the supply made by the appellant is a construction service which requires manpower and supply and execution of goods in the premises where immovable property is located and such supply cannot be undertaken from a distance from the head office of the appellant and can be executed and supervised only from the project office or branch office located at the place of construction. Hence, the office (fixed establishment) of the appellant regi....
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.... a consideration is payable for the supply of goods or services or both, the person who is liable to pay that consideration; (b) where no consideration is payable for the supply of goods, the person to whom the goods are delivered or made available, or to whom possession or use of the goods is given or made available, and (c) where no consideration is payable for the supply of service, the person to whom the service is rendered, and any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the supply and shall include an agent acting as such on behalf of the recipient in relation to the goods or services or both supplied. 2. NBCCL is the executive agent of the Government of India and is liable to pay the consideration to the appellant on behalf of the Government of India. The location of NBCCL should be considered as the location of the recipient since the services are received by the Government of India through NBCCL and the term 'recipient' includes its agent as per the above definition. The location of the recipient is defined under Section 2(70) of CGST Act, 2017 and 2(14) of IGST Act, 2017 which are pari materia to e....
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....n under GST Act, 2017 and not where the consideration is paid from. Hence, the location of the recipient is also outside India. 6. Supply is in relation to immovable property: 1. There is no dispute with regards to the fact that the appellant is executing a works contract of construction of a building for government of Maldives on behalf of Ministry of External Affairs, Government of India. The building being an immovable property, all services in relation to such construction are treated as relating to immovable property. 7. The place of supply is outside India in terms of Section 13 of IGST Act, 2017: 1. The next important factor for determining whether the supply made by appellant is taxable under the purview of GST Act, 2017 is, the 'place of supply' which is defined under Section 2(86) of CGST Act, 2017 as "the place of supply as referred to in Chapter V of the Integrated Goods and services Tax Act". 2. The 1st Respondent erred in holding that the 'place of supply' is India in terms of Section 12(3) of IGST Act, 2017 as such finding is incorrect since the subject supply of construction by the appellant is covered under Section 13 of the IGST Act, 2017 a....
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....ing that of architects or interior decorators, shall be place where the immovable property is located or intended to be located. ......................." 4. The above provisions very clearly stipulate that when location of either supplier or the recipient is outside India and not necessarily both, Section 12 is not applicable and Section 13 is applicable and in terms of Section 13(4), the immovable property is intended to be located in Maldives and all services in relation to construction of immovable property are supplied outside India. 5. In view of the above legal position, the place of supply of service provided by the fixed establishment of the appellant is Maldives i.e., outside India. 8. The learned lower authority erred in not appreciating the facts and legal position that the supply provided by the appellant in the non-taxable territory of Maldives is outside the ambit of GST for the above reasons. The provisions of CGST Act and IGST Act, shall extent to the whole of India but not to non-taxable territory and when the entire supply and receipt of service is made outside India and when the supplier is also located outside India in the case of immovable property, GST ....
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....sonal Hearing: 6. In terms of Section 101(1) of the Act, the appellant was given personal hearing, on 29.04.2022. Shri M/s.YSR & Associates, Advocates and Tax consultants (C. Srinivas Tax Consultant and Y. Siri Reddy Advocate) and Authorised Representative appeared for the Appellants. The appellants reiterated their written submissions made along with the application and no additional submissions were made at the time of personal hearing. They requested to set aside the advance ruling in respect of said issue that are being contested and consider their appeal favourably. Discussions and Findings : 7. The objections raised by the applicant are examined with the following observations:- 1. The applicant mainly contends that the location of the applicant and location of the recipient is outside India, hence the place of supply should be determined as per the provisions of section 13(4) of the IGST Act, 2017. 2. On verification of the contract documents it is noticed that National Building Construction Corporation Ltd, Delhi entered into contract with M/s Avantika Contractors (I) Limited, Hyderabad, Telangana for the Construction of institute for security and law enforcement stu....
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....istered office at F.Reef View,Hirudhu Maa Magu, S.Hithadhoo, Republic of Maldives. 7. The applicant contends that the registered office at Maldives is the fixed establishment for Sri Avantika Contractors (I) Limited, Hyderabad , hence the location of the supplier is in Maldives as per section 2(15) of the IGST Act, hence place of supply is to be considered as per section 13(4) of the IGST Act, 2017. 8. Before examining the Place of Supply or taxability of the transactions, it is necessary to examine the nature of transaction between the applicant and M/s NBCC (India) Ltd. The applicant all along contends that the transaction is that of Works Contract service. In this context, the definition of Works Contract as per Sub-section 119 of Section 2 of CGST Act, 2017 is reproduced as under :- (119) "works contract means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract; 9. Therefore, the essenti....
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.... to perform is being made from the Place of business for which registration has been obtained (i.e. M/s Avantika Contractor (I) Limited, 401/A wing D.No:6-3-352/2&3, Astral height complex, Road No 1, Banjara hills, Hyderabad 500034). Hence, this location, i.e., M/s Avantika Contract (I) Limited with GSTIN: 36AAJCS55046C1ZG at Hyderabad will be the location of the Supplier of services. 15. Also, on careful perusal of the definition of "person" under subsection (84) of section 2 of the CGST Act, 2017 and the definitions of "company" and "foreign company" under Section 2 of the Companies Act, 2013, it is observed that a company incorporated in India and a foreign company incorporated outside India, are separate "person" under the provisions of CGST Act and accordingly, are separate legal entities. Thus, a company incorporated in India and a body corporate incorporated by or under the laws of a country outside India (which is also referred to as a foreign company under the Companies Act) are separate persons under CGST Act, and thus are separate legal entities. 16. Hence, the registered place of business of M/s Avantika Contractors (I) Limited, Maldives cannot be considered as fixe....
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....nt. Instead, the place where the total service (works contract service), of agreeing to perform has been received will be the location of recipient of service. 22. In this case, the supply, the agreement to perform is received at the Place of business for which registration has been obtained (i.e. NBCC (India) Limited, Lodhi Road, New Delhi). Hence, this location, i.e., NBCC (India) Limited (with GSTIN: 07AAACN3053B1Z2) at New Delhi will be the location of the recipient of services. 23. Now, since the Location of the supplier and the location of the recipient are determined, we may proceed to examine the provisions relating to Place of Supply. 24. Here, in this case as both the location of the recipient of services and location of supplier of services are located in India and also since service is "directly in relation to" construction of an immovable property, the provisions of section 12(3)(a) of the IGST Act,2017 would apply . The contents of which are reproduced as under :- (3) The place of supply of services,- (a) directly in relation to an immovable property, including services provided by architects, interior decorators, surveyors, engineers and other related exper....