TaxTMI 
TaxTMI 
2025 (6) TMI 1232
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....raud or suppression of material facts or misrepresentation 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. Becton Dickinson India Private Limited, located at No. 34, Assisi Nagar, West Thottam, Madhavaram, Tiruvallur - 600 051, (hereinafter called as the "Applicant") is a private limited company who are engaged in the manufacturing and trading of medical equipment/devices. 2. The Applicant has made a payment of application fees of Rs. 5,000/- each under sub rule (1) of Rule 104 of CGST Rules, 2017 and TNGST Rules, 2017. The Applicant has filed this application seeking Advance Ruling on the following questions, viz., (i) Whether the Applicant can avail the ITC of the import IGST paid through TR-6 ....
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.... Since the goods are imported from the related parties, the import transaction value is subject to review by the Special Valuation Branch (SVB) of the Customs under Circular No. 5/2016-Customs dated 09.02.2016. Accordingly, an SVB Order dated 27.02.2015 has been obtained by the applicant from the Deputy Commissioner of Customs, SVB, New Delhi, which further stand renewed vide order dated 11.06.2018. viii) In the SVB Order, the LRD agreement was examined and it was accepted that the relationship between the applicant and the group company has not influenced the import price. Vide para 15 of the SVB order, the aforesaid 'true up' adjustment was also examined, and it was held that the applicant is liable to pay applicable customs duties along with applicable interest in case of upward revision in the invoice value of imported goods voluntarily. The aforesaid LRD agreement as well as the SVB order are continuing as on date of filing this application. ix) Upon conclusion of FY 2022-23, owing to increase in business and domestic prices, the applicant has earned an operating profit in excess of arm's length range of operating margin. Accordingly, in compliance with the S....
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....ch ITC of import CGST can be availed. One of the salutary rules of interpretation is that the legislature does not waste words, and each word must be allowed to play its role to achieve the legislative intent and object [UOI Vs Brigadier P.S. Gill [2012 (272) E.L.T. 321(S.C)] • Exposition of "other documents" for availing ITC. Rule 36 (3) prescribes any other document "similar" to a bill of entry, prescribed under the Customs Act or rule made thereunder, "for" "assessment" of IGST on imports. "Similar" denotes partial resemblance, and may also denote sameness in all essential particulars. It also means corresponding to or resembling in many respects, somewhat like, or having a general likeness. "Assessment" means determination of dutiability of any goods or service and includes provisional assessment self-assessment re-assessment and any assessment in which the duty assessed is nil, and is thus capable of bearing a very comprehensive meaning so as to comprehend the whole procedure for ascertaining and imposing-duty-liability. "For" is used as a function to indicate purpose of any intended destination or the object towards which the acquisition is directed. A comb....
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....e instant case reveals that it has particulars of the reason/purpose for which payment is made, the minor head account in which the payment is made, the type of customs duties which are paid, the details of importer, the details of the authority to whom the challan is tendered. • TR-6 is an accepted document for availing credit under the Central excise/Service Tax law. The explanation to Rule 9 (1) (b) of the CENVAT Credit Rules, 2004 clearly provided that supplementary invoice includes a challan or any other similar document evidencing payment of additional amount of additional duty leviable under section 3 of the Customs Tariff Act. In CCE Vs Essel Propack Ltd [2015 (39) S.T.R. 363 (Bom)], the Hon'ble High Court held that Rule 9 is procedural aspect for which CENVAT credit should not be disallowed considering when the payment of tax is undisputed and the documents are genuine. • The procedural law should be harmoniously interpreted to achieve the object of law. Therefore, rule 36 (3) should be read in a manner to allow credit based on any document which substantially conveys that the tax is levied and paid, though it may or may not bear the strict partic....
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....OI Vs Cosmos Films. At para 5.1(b), it was stated that under GST law, a TR-6 is not a prescribed document for the purpose of availing ITC of import IGST. • The applicant understands that the aforesaid circular is not est/non applicable for the following reasons, viz., (i) the circular is issued in the light of limited facts and cannot have a general application, (ii) no reasons provided for the conclusions provided at para 5.1, and is without any basis, (iii) At para 5.1(a), the circular has accepted that due to lack of functionality in the ICEGATE system, re-assessment of bill of entry is not available, once out of charge (OOC) is issued. Accordingly, in para 5.2(b), it is stated that assessment group to cancel OOC and then re-assess the bill of entry. In the present case, the applicant in the first place approached the Chennai-Air Cargo and Chennai FTWZ to reassess the bill of entries, however, again due to system functionality, the bill of entries were not assessed. Therefore, this circular is not applicable to the present case, since there is an SVB order, based on which there was a re-assessment by the customs authorities through their letters informing the applic....
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.... of goods or services, where the taxable value or tax charged in the tax invoice is found to be less than the taxable value or tax payable. Further, in terms of rule 53 of the CGST Rules, debit note contains particulars similar to the ones that are in the tax invoice. Therefore, it is clear that a bill of entry is a separate document and not a debit note. • The provisions of CGST Act and CGST Rules makes a marked distinction between Bill of Entry and tax invoice/debit note. For instance, Section 16 (2) (a) of the CGST Act requires possession of 'tax invoice' or 'debit note', or 'such other duty paying documents' for availing ITC, but though bill of entry may in the same class, it is not in strict sense a tax invoice or debit note. Rule 36 (1) of the CGST Rules encapsulates various documents based on which ITC can be availed. Tax invoice is referred in Rule 36 (1) (a), debit note - 36 (1) (c), and bill of entry - 36 (1) (d). Rule 36 (4) of the CGST Rules, applies a specific embargo when it relates to 'tax invoice', or 'debit note', such that ITC is available only when the details of the same are uploaded by the vendor in his GSTR-1/IFF and reflecting in Form GSTR-2 of t....
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.... That the same analogy applies to Section 16 (4) which is linked only to tax invoice or debit note, and not to a bill of entry. iv. The Order-in-Appeal No.RAJ-EXCUS-000-APP-033-2021-GST-JC dated 06.08.2021 passed by the Commissioner (Appeals) in the case of M/s. Reliance Industries Limited - The time limit prescribed under Section 16 (4) for taking ITC is not applicable to bill of entry. 3) With regard to Question No. 4, i.e., "If the answer to Q.3 for bill of entry is in affirmative, whether the time limit for availing ITC would begin from the initial date of bill of entry originally filed or from the date of re-assessment of bill of entry?" • If at all, Section 16 (4) of the CGST Act were to be applicable to TR-6 challan or Bill of Entry, even for the sake of assumption, then the 'financial year' should be considered the year in which TR-6 challan is drawn or Bill of Entry is re-assessed. • As per Section 16(1) of the CGST Act, ITC can be availed where the goods or services are used or to be used in the course or furtherance of business. And under Section 16 (2), ITC is not eligible unless - • The registered is in possessio....
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....(6) TMI 510 - CESTAT New Delhi] - The limitation would begin from the date when the right to receive the refund is crystallised. v. State of Madhya Pradesh Vs. Narmada Bachao Andolan [2011 (7) SCC 639] - Where the law creates a duty or charge, and the party is disabled to perform it, without any fault on his part, and has no control over it, the law will in general excuse him. Even in such a circumstance, the statutory provision is not denuded of its mandatory character because of the supervening impossibility caused therein. • Accordingly, it would be impossible for the applicant to avail ITC based on the original date of bill of entry, because it would not have been possible to predict how much differential duty would be paid / payable in future, and it would be impossible to avail ITC based on future event. Support is also drawn from the language of Section 16 (4) which specifically prescribes time limit vis-à-vis debit from the date when the debit note is issued. Therefore, as per this view also, the date should begin from the date of TR-6 or as the case may be from the date of re-assessment of bill of entry. 4.1. Prima facie, we find that the qu....
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....interest under TR-6 challans. 5.3. He further stated that while the office attached to 'Sea-Cargo' facility, normally issues a re-assessed Bill of Entry for such cases of price revision, the offices attached to 'Air Cargo' and 'FTWZ', do not issue such documents, and that they advise the applicant to pay the differential duties through a TR-6 challan. He reiterated that the queries raised in the application revolve around the availment of ITC on the IGST component involved under the said document, viz., TR-6 challan, which is to be considered as the duty paying document in such cases. He however pointed out that the statute under GST discusses the documents, viz., Invoice, Debit note, Bill of Entry, etc., in specific terms, whereas no reference to TR-6 challan is made either under Section 16 (2) (a) of the CGST Act, 2017, which refers to 'such other tax paying document', or under Rule 36 of the CGST Rules, 2017, which refers to 'a Bill of Entry or any similar document prescribed under the Customs Act, 1962'. 5.4. Accordingly, he stated that they are of the opinion that the TR-6 challan, along with the SVB order and letter issued by the tax authorities to pay duty under Sectio....
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....ermined and compared with the actual margins earned by the applicant on the sale of imported goods. In case, the actual margin earned by the Applicant is more that the ALP margin, then the applicant transfers the differential margin through a pricing adjustment ('true up') by the overseas entity from whom the goods were imported, and vice versa. 6.3. Since the goods are imported from the related parties, the import transaction value is subject to review by the Special Valuation Branch (SVB) of the Customs under Circular No. 5/2016-Customs dated 09.02.2016. Accordingly, an SVB Order dated 27.02.2015 has been obtained by the applicant from the Deputy Commissioner of Customs, SVB, New Delhi, which further stands renewed vide order dated 11.06.2018. In the SVB Order, the LRD agreement was examined and it was accepted that the relationship between the applicant and the group company has not influenced the import price. Vide para 15 of the SVB order, the aforesaid 'true up' adjustment was also examined, and it was held that the applicant is liable to pay applicable customs duties along with applicable interest in case of upward revision in the invoice value of imported goods voluntari....
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....he basis of any of the following documents, namely,- (a) an invoice issued by the supplier of goods or services or both in accordance with the provisions of section 31; (b) an invoice issued in accordance with the provisions of clause (f) of sub-section (3) of section 31, subject to the payment of tax; (c) a debit note issued by a supplier in accordance with the provisions of section 34; (d) a bill of entry or any similar document prescribed under the Customs Act, 1962 or rules made thereunder for the assessment of integrated tax on imports; (e) an Input Service Distributor invoice or Input Service Distributor credit note or any document issued by an Input Service Distributor in accordance with the provisions of sub-rule (1) of rule 54." While the aforesaid rule recognises the documents, viz., invoice, debit note, ISD invoice, ISD Credit note, etc., on the basis of which ITC could be availed, as far as Bill of Entry is concerned, it is specifically provided for in clause (d) as, "a bill of entry or any similar document". The phrase 'or any similar document' in the said legal provision, makes it more accommodative with a broader connot....
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.... On perusal, para 26 of the SVB (Special Valuation Branch), New Delhi Order dated 27.02.2015, runs as below :- "26. The Importer is required to make annual declaration to the undersigned regarding any change in the mode of invoicing or terms of agreements and relationship with the foreign collaborators failing which review of the order may be initiated in that year itself. On expiry of every year if such declaration is not furnished, this office may order for provisional assessment with EDD as deemed appropriate. Declaration should indicate clearly whether the facts of the case continue to be same." Apart from the same, we find that it was held under para 15 of the said SVB Order that any in case of any upward revision in the invoice values of the imported goods by the foreign suppliers, the importer is required to pay applicable customs duty along with interest on the differential amount voluntarily. 6.8 Accordingly, we come to understand that in the instant case, re-assessment of duties of customs takes place whenever there is an upward revision of price, due to transfer price adjustment with their parent company located abroad. We also come to understand that t....
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....of import (POI) ;- (a) for the relevant imports that could not meet the said pre-import condition and are hence required to pay IGST and Compensation Cess to that extent, the importer (not limited to respondents) may approach the concerned assessment group at the POI with relevant details for purposes of payment of the tax and cess along with applicable interest. (b) the assessment group at POI shall cancel the OOC and indicate the reason in remarks. The BE shall be assessed again so as to change the tax and cess, in accordance with the above judgment. (c) the payment of tax and cess, along with applicable interest, shall be made against the electronic challan generated in the Customs EDI System. (d) on completion of the above payment, the port of import shall make a notional OOC for the BE on the Customs EDI system (so as to enable transmission to GSTN portal of, inter-alia, the IGST and Compensation Cess amounts with their date of payment (relevant date) for eligibility as per GST provisions). (e) the procedure specified at (a) to (d) above can be applied once to a BE. 6.9 Accordingly, the input credit with respect to such assessed ....
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....e purpose of availment of ITC. 6.12 Moving on to the second query raised by the applicant, i.e., "Whether the eligibility to avail ITC of the import IGST paid vide TR-6 Challan is subject to the time limit prescribed under Section 16 (4) of the CGST Act?", we are of the opinion that this query need not be answered, having already held that TR-6 challan as such, or a TR-6 challan read with the SVB order and letters issued by the tax authorities, cannot be considered as an eligible document for the purpose of availment of ITC, as discussed in detail above. 6.13 As regards the third query raised by the applicant, i.c., "Whether the eligibility to avail ITC of the import IGST paid under the re-assessed bill of entry is subject to the time limit prescribed under Section 16 (4) of the CGST Act?", we note that the provisions of Section 16 (4) of the CGST Act, 2017, read as below :- "(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the thirtieth day of November following the end of financial year to which such invoice or debit note pertains or furnishing of the relevan....
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.... (ii) composite supply and mixed supply; (iii) time and value of supply; (iv) input tax credit; ------------------------ (ix) payment of tax; ------------------------ (xii) assessment; (xvi) demands and recovery; ------------------------ (xxi) offences and penalties; ------------------------ shall, mutatis mutandis, apply, so far as may be, in relation to integrated tax as they apply in relation to central tax as if they are enacted under this Act:" Much in the same manner, Rule 2 of the IGST Rule, 2017, specifies as follows :- "Rule 2 - Application of Central Goods and Services Tax Rules.- The Central Goods and Services Tax Rules, 2017, for carrying out the provisions specified in section 20 of the Integrated Goods and Services Tax Act, 2017 shall, so far as may be, apply in relation to integrated taxes they apply in relation to central tax." From the above, it could be seen that once the provisions of CGST Act and Rules are made applicable to IGST, mutatis mutandis, for the purposes of and in relation to input tax credit, payment of tax, assessment, demands and re....
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.... the case of Brakes India Ltd., Vs. Collector of Central Excise, Madras. The said order discusses about the provisions of the erstwhile Central Excise Rules, 1944, wherein under Rule 57E, limitation period has not been prescribed for taking Modvat credit, whereas the normal time limit was six months for taking credit in respect of the other provisions under Rule 57. We note that in para 9 of the said order, it is held as follows ;- "We hold that even under Rule 57E where no limitation is prescribed, six months will be a reasonable period of limitation in the facts and circumstances of the case which should be reckoned from the date of receipt of goods on the factory for taking Modvat. In our view, this is in consonance with the ratio of the Supreme Court in the case of M/s. Citadel Fine Pharmaceuticals." We are therefore of the opinion that the reliance placed by the applicant in this regard, on an Order-in-Appeal No.RAJ-EXCUS-000-APP-032-TO-033-2021-GST-JC dated 11.12.2020 passed by the Commissioner (Appeals), Rajkot, wherein it is held that time limit prescribed under Section 16 (4) for taking ITC is not applicable to ITC availed on the strength of bill of entry, is o....