TaxTMI 
TaxTMI 
2025 (5) TMI 1883
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....entation of facts, shall render such ruling to be void ab initio in accordance with Section 104 of the Act. 5. The provisions of both the Central Goods and Services Tax Act and the Tamil Nadu Goods and Services Tax Act (herein referred to as the 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 Services Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Services Tax Act. M/s. Fairmacs Shipstores Private Limited, located at No. 31, Moore Street, Chennai - 600001, (hereinafter called as the "Applicant") is a company who are wholesale traders in liquor, frozen meat products, food products. They make supplies to hotels, other institutional customers and also to ships, consulates etc. They have branches at Bangalore, Vizag and Kakinada. The applicant is mainly supplying frozen meat like fish, chicken, etc., and they also make supplies on branch transfer basis from Chennai to their Bangalore branch for which they have a GST registration in Bangalore. They are selling products packed in individual packs of 1Kg, 2Kg, 3Kg etc., to distr....
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....ation No. 1/2017-Central Tax (Rate) and Notification No. 6/2022-Central Tax (Rate) along with the FAQ published by the Department in F.No. 190354/ 172/2022-TRU dated 17.07.2022. 2. The Legal Metrology (Packaged Commodities) Rules, 2011." 4.1 Prima facie, we find that the queries raised by the applicant get covered under clauses (a), (b) and (e) of the Section 97 (2) of the CGST Act, 2017, and as such are liable to be admitted. 5.1 The applicant falls within the administrative jurisdiction of 'STATE'. The jurisdictional authority, Assistant Commissioner (ST), Harbour Assessment Circle vide their letter dated 11.09.2024 have stated that no proceedings are pending, or decided, in respect of the issues involving the questions raised by the applicant. The remarks in respect of the queries raised by the applicant were as follows :- Q.1. Hotels are not to be treated as an institution. Q.2. The taxpayer is eligible to avail ITC, as such supplies are not 'Nil' rated. Q.3. GST is payable on such inter-branch transfers. Q.4. As they are not supplying to institutions, GST is payable on such transactions with distributors. 5.2 The Central jurisdictional authority has not furnished ....
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....-Central tax (Rate) dated 13.07.2022 and Notification No. 07/2022-Central tax (Rate) dated 13.07.2022, whereby GST was made applicable on supply of such "pre-packaged and labelled" commodities attracting provisions of Legal Metrology Act, 2009. 7.4 In this regard, it is seen that Notification No. 06/2022-Central tax (Rate) dated 13.07.2022, amends the parent rate Notification No. 01/2017-Central Tax (Rate) dated 28.06.2017 by way of substituting the suffixing portion attached to the specified commodities beginning with the words 'and put up in unit container, and,- ---- ' with the phrase 'pre-packaged and labelled'. Likewise, Notification No. 07/2022- Central tax (Rate) dated 13.07.2022, amends the parent exemption Notification No. 02/2017-Central Tax (Rate) dated 28.06.2017 by way of substituting the suffixing portion attached to the specified commodities beginning with the words 'other than those put up in unit container, and, ----- ' with the phrase 'other than pre-packaged and labelled'. 7.5 The term "pre-packaged and labelled", has been defined under the aforesaid notifications, viz., No. 06/2022 & 07/2022, as follows :- "The expression "pre-packaged and labelled" means a ....
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....at or fish meat are to be delivered at doorstep or across the counter, they are normally done at fresh or chilled state. On the other hand, when the shelf-life is required to be maintained in respect of the said products in order to enable delivery at a much later date to destination afar, or for export consignments, or to be kept at the shelf of departmental stores over a period of time, the products concerned are required to be maintained at a frozen state, often in pre-packaged mode. 7.7 As regards, the rate of GST applicable to the impugned supply, it could be seen that the Notification No. 01/2017-CT (Rate) dated 28.06.2017 as amended, reads as follows under Schedule I (GST @ 5%) :- S.No. Chapter / Heading / Sub-heading / Tariff item Description of Goods 1 0202, 0203, 0204, 0205, 0206, 0207, 0208, 0209, 0210 All goods [other than fresh or chilled], pre-packaged and labelled; 2 0303, 0304, 0305, 0306, 0307, 0308 All goods [other than fresh or chilled], pre-packaged and labelled; It could be seen from the above, that meat of chicken (HSN 0207), or of fish (HSN 0304) 'other than fresh or chilled', i.e., frozen products, get covered under entries at Sl. Nos. 1 and 2....
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.... pre-packaged condition are required to bear the declarations under the provisions of the Legal Metrology Act, 2009 and the rules made thereunder. However, it is to be noted that if such specified commodities are supplied in a package that do not require declaration under Legal Metrology Act, the same would not be treated as pre-packaged and labelled for the purpose of GST levy. In this regard, it is seen that as per Rule 3 of the Legal Metrology (Packaged Commodities) Rules, 2011, the provisions applicable to packages intended for retail sale shall not apply to following cases, i.e., (a) Packages of commodities containing quantity of more than 25 kilogram or 25 Litre. (b) Cement Fertilizer and agricultural farm produce sold in bags above 50 kilogram (c) Packaged commodities meant for industrial consumers or institutional consumers. 7.10 As per Rule 2 (bb) of Legal Metrology (Packaged Commodities) Rules, 2011, "industrial consumer" means the consumer who buys packaged commodities directly from the manufacturer or from an importer or from wholesale dealer for use by that industry and the package shall have declaration 'not for retail sale'. And, as per Rule 2 (bc) of the ....
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....oot point for consideration here is that the supply to hotels of frozen foods like fish, chicken, etc., irrespective of the fact as to whether it is meant either for an 'industrial consumer' or for an 'institutional consumer', is eligible for exemption from payment of GST, vide entry Sl.No.9 of Notification No. 2/2017-CT (Rate) dated 28.06.2017 as amended, as it is clear that they are outside the ambit of 'pre-packaged and labelled' category by virtue of clause (c) to rule 3 of the Legal Metrology (Packaged Commodities) Rules, 2011. 7.12 in this regard, it is also seen that the above position stands confirmed through the FAQ issued by Government of India, Ministry of Finance, Department of Revenue (Tax Research Unit), dated 17th July, 2022, in F. No. 190354/172/2022-TRU, wherein under SI.No.7, it has been clarified as follows :- S.No Question! Clarification 7. Whether tax is payable if such packaged commodities are supplied for consumption by industrial consumers or institutional consumers Supply of packaged commodity for consumption by industrial consumer or institutional consumer is excluded from the purview of the Legal Metrology Act by virtue of rule 3 (c) of Chapter-II ....
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...., is effectively ruled out in view of the fact that the resultant output ends up as an outward supply on commercial basis. Hence, we find that such sale of packaged commodities to hotels by the Applicant, is to be considered as a supply made to 'industrial consumer', and that the same should be for use by that hotel/industry. 7.17 Accordingly, we observe that while the other two conditions appear to have been fulfilled in the instant case, the first and primary condition, viz., the declaration of Not for Retail Sale', has not been fulfilled in the instant case. Hence, for supplies to be made to institutional or industrial consumers, we find that the exemption from GST as claimed by the Applicant would be available, if and only if, it fulfils all the conditions envisaged under Rule 2(bb) and Rule 2(bc) of the Packaged Commodities Rules, 2011. 7.18 Under the facts and circumstances of this case, we attempt to discuss and answer the queries raised by the applicant in the application for advance ruling filed, as follows :- (i) Whether hotels qualify as industrial/institutional consumers as per Rule 2bb and 2bc of the Legal Metrology (Packaged Commodities) Rules, 2011? Hotels qual....
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...., whether within the state or inter-state, they become distinct persons and accordingly, every branch or depot with individual GSTINs belonging to one company will be treated as an individual entity. Further, as per clause (2) to Schedule I of the CGST Act, 2017, "Supply of goods or services or both between related persons or between distinct persons as specified in section 25, when made in the course or furtherance of business", is an activity which is to be treated as supply under Section 7 of the Act, ibid, even if made without consideration. Therefore, GST is chargeable if transactions take place between two persons with different GSTINs. In fine, we are of the opinion that intra-state stock transfers holding the same GSTIN are not subject to GST, whereas stock transfers to distinct persons within the state and inter-state stock transfers are chargeable to tax under GST. In the instant case, we observe that while the applicant's Head Office is in Chennai, they have a branch at Bangalore, and another at Andaman & Nicobar as well. As these branches are located outside the state of Tamilnadu, they become distinct entities which necessitates the need for a separate GST registration....