GST Daily
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Today’s newsletter analytically summarizes the top GST stories reported at taxmann.com.
A notice under Section 130 of CGST Act, 2017 was issued to the petitioner calling upon him to remain present before authority on 15-10-2019. The petitioner appeared and submitted about the pendency of the petition under section 130. However, the authority passed an order under Section 130 on 15-10-2019, i.e. on the same date, confirming all proposals in GST MOV 10 regarding the levy of tax and fine. It filed a writ petition to challenge the order on the ground that the order was passed without an opportunity for a hearing.
The Honorable High Court noted that the petitioner was called to remain present on 15-10-2019, and he submitted before the authority that a petition was filed before the Court. However, the order under section 130 was passed on the same date, which resulted into the denial of a reasonable opportunity to the petitioner to defend in proceedings.
Since the impugned order was passed in violation of the principles of natural justice, the Court held that the impugned order was liable to be set aside. The Court also remanded the proceedings to Competent Authority to decide the matter afresh after giving an opportunity to the petitioner.
The applicant was engaged in the business of manufacturing of apparel, and it hired a third-party contractor to provide canteen services to employees in the factory. It filed an application for an advance ruling to determine whether GST would be applicable on the amount recovered from employees for the canteen facility provided to them.
The Authority for Advance Ruling observed that the applicant was involved in the supply of manufacture of apparel and not in the activity of provision of canteen service. In the instant case, the canteen service would not be an output service of the applicant as canteen services would be received by the applicant from third-party providers. Therefore, it can be concluded that the provision of a canteen facility by an applicant to employees would not be a supply as it shall not be in the course or furtherance of business.
Further, the applicant would be merely collecting a part of canteen expenses from employees, and thus, it would not be tantamount to supply as per Section 7 of CGST Act, 2017. Hence, it was held that applicant would not be liable to pay GST on recoveries from employees for canteen services provided to them.
That’s it from us for today! Stay Tuned for more updates from Taxmann.com.
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