TaxTMI 
TaxTMI 
2024 (3) TMI 44
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....al advance ruling have changed. 4. In terms of Section 104 of the Act, where the Authority finds that advance ruling pronounced by it under sub-section (4) of Section 98 or under sub-section (1) of Section 101 has been obtained by the applicant 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 applicant as if such ruling had never been made. 5. At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act. 1. The applicant submitted a copy of Electronic Cash Ledger evidencing payment of application fees of Rs. 5,000/- each under sub-rule (1) of Rule 104 of CGST Rules 2017 and SGST Rules 2017. 2.1 The applicant, a GST Registrant, is a P....
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....the leasehold rights may transfer the rights to third party but only with the approval of SIPCOT, who may or may not grant such approval. • The applicant themselves have admitted that the transaction in question, gets covered under 'Supply', but have referred to Sl. No. 41 of the exemption Notification No. 12/2017-CT dated 28.06.2017. • On perusal of the provisions relating to the said notification, it is seen that the same would be applicable to State or Central Government Industrial Corporations or Undertakings, or any Undertaking having 50% or more ownership of Central or State Government and engaged in granting of long terms lease of 30 years or more of Industrial plots, and hence the same is not applicable to the applicant. • Further, the transaction is not the transfer of lease hold rights of land as claimed by the applicant, but transfer of interest, i.e., Agreeing to part with the interest on the lease hold land held by the applicant to the buyer on receipt of consideration. • Accordingly, the activity undertaken by the applicant for which a consideration of Rs. 1.24 crores is said to have been received, is an activity of ....
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....service tax would be applicable on transfer of leasehold rights. • Therefore, the activity of assignment is in the nature of agreeing to transfer leasehold rights. It does not amount to further sub-leasing, as the applicant's rights as per the deed stands extinguished. Neither does it create fresh benefit from land other than the leasehold right. It is like a compensation for agreeing to do the transfer of the applicant's rights in favour of the assignee. • However, as per entry No. 41 of Notification No. 12/2017-CT (Rate) dated 28.07.2017, GST exemption on the upfront amount (called as premium, salami, cost, price, development charges or by any other name) payable for long term lease of 30 years, or more of industrial plots or plots for development of infrastructure for financial business is admissible irrespective of whether such upfront amount is payable or paid in one or more instalments, provided the amount is determined upfront. Accordingly, the description of services in the subject matter, is to be read as long term leasing services, on which exemption is available. 6.1 The applicant, after consent, was given an opportunity to be heard in person....
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....nta Flex (India) Private Limited in the books of M/s. Ionbond Coatings Private Limited, depicting the details of payments received by the applicant. DISCUSSION AND ANALYSIS 7.1 We have carefully considered the submissions made by the applicant in the advance ruling application, the additional submissions made during the personal hearing and the comments furnished by the 'CENTER' Tax Authorities. The applicant filed advance ruling application under Section 97(2) of GST Act, 2017. 7.2 From the submissions made at the time of filing the application, it is seen that the applicant had a factory at B-26(B), SIPCOT Industrial Estate, Gummidipoondi, Tarnilnadu-601201, which was allotted by SIPCOT on long term lease. However, as the applicant had to relocate their business operations to Plot No.B-700, Indospace Industrial Park, Block B, Oragadam Walajabad Road, Panruti, Kancheepuram, Tamilnadu-631604, they transferred building, electric equipment and lease hold rights of lands to Kanta Flex (India) Private Limited, after receiving necessary approval from State Industries Corporation of Tamil Nadu Limited (SIPCOT). As per the Memorandum of Understanding dated 19.09.2021 entered into....
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....ansferor shall take back all movable property except electrical equipment, related wiring and cabling fixtures and fittings. • As per the Annexure-C to MOU, the overall amount to be transferred is arrived as follows:- Particulars Amount (INR) Leasehold rights in land 1,24,00,000 Building 8,00,000 Electric Equipment 18,00,000 Total 1,50,00,000 TANGEDCO - Security Deposit 13,00,000 Grand Total 1,63,00,000 8.3 As per the Letter dated 30.03.2022 of SIPCOT, the SIPCOT had accorded approval for transfer of leasehold rights of the property in question, based on the applicant's request. The important conditions imposed by SIPCOT, amongst various other conditions for approval, were :- • (Sl. No. 2) - The new incumbent (M/s. Kanta Flex) shall execute Modified Lease Deed (MLD) at their cost within 45 days from the date of approval of draft MLD by SIPCOT; • (Sl. No. 7) - The new incumbent shall furnish an undertaking with regard to payment of service tax in the prescribed format in Rs. 20/- non-judicial stamp paper before execution of Modified Lease Deed; • (Sl. No. 8) - All other conditions of All....
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....e been received including the Security Deposit (TANGEDCO) of Rs. 13,00,000/-. Further, it is seen from the ledger that entries relating to the Invoices towards the transfer of leasehold rights in land, Building, Electrical Equipment, etc., have been booked only on 29.08.2022, whereas the entire payment is seen to have been received well in advance by 07.05.2022. 8.6 Accordingly, from the submissions made and documents furnished by the applicant, especially during the personal hearing and thereafter, it is quite clear that the activities relating to the transaction in question, have been carried out already, i.e., before the filing of application dated 29.12.2022 by the applicant, viz., • The Memorandum of Understanding between the applicant (transferor) and M/s. Kanta Flex (transferee), is dated 19.09.2021. • The Letter of SIPCOT, which extends approval for transfer of leasehold rights on land from the transferor to the transferee, is dated 30.03.2022. • The booking entry relating to the invoice reported to have been raised by the applicant on the transferee, is dated 29.08.2022. • The payment of entire consideration towards le....