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June 29 To July 5, 2019 u Taxmann’s Corporate Professionals Today u Vol. 45 u 51payment is not made in consideration of
the transfer of goods. Such payment is for
charity and is received and held in trust by
the seller. If such amounts are credited to
charity and do not form part of the income
of the assessee, they cannot be included in
the transaction value or assessable value of
the goods.
The Supreme Court held that the Dharmada
charges paid voluntarily by customers could
not be treated as part of assessable value
of goods.
C not available on goods and serIT -
vices used for laying of pipelineWestern Concessions (P.) Ltd., In re [2019]
106 taxmann.com 186 (AAR - Maharashtra)
The Applicant is setting-up a LNG re-gas-
ification project in Maharashtra which needs
installation of cross-country pipelines in order
to supply it to the ultimate customer. There-
fore, the applicant is laying a gas pipeline
for delivering the high pressure natural gas
from the Floating Storage Regasification unit
(FSRU) to the National Grid. It has sought
advance ruling to determine whether it is
eligible to avail of ITC of GST paid on
goods and services used for laying down
of pipelines?
The Authority for Advance Ruling, Maharash-
tra observed that as per the provision of the
blocked credits under the CGST Act, 2017,
input tax credit is not available in respect
of works contract services when supplied
for the construction of immovable property
excluding plant and machinery. The explana-
tion defining plant and machinery excludes
‘pipelines laid outside the factory premises’.
As per the Factory Act, 1948 factory means any
premises having workers who are involved in
the manufacturing process. In this case, FSRU
is a place where there is a conversion of LNG
to gaseous form. Therefore, the said process
leads to production of natural gas which is
then distributed to the ultimate consumer?
The Authority for Advance Ruling, Maha-
rashtra held that the applicant is not eligible
to avail of ITC of GST paid on goods and
services used for laying of pipeline.T to be paid on difference between GS
selling price & purchase price in respect
of auction of old goodsSafset Agencies (P.) Ltd., In re [2019] 106
taxmann.com 188 (AAR – Maharashtra)
The Applicant is an auctioneer who sells art
works, personal effects or such other used
goods in an auction. It purchases the above
goods from the sellers and displays the same
on his website to auction them. It has sought
advance ruling to determine whether he is
dealing in second hand goods and whether
the GST is to be paid on the difference be-
tween selling price and purchase price on
sale of such goods?
The Authority for Advance Ruling, Maharash-
tra observed that applicant auctions second
hand or used goods bought by them. They
are trading in such goods and auction is just
a medium to sell the goods. It is not the
case where they are auctioning the goods
belonging to someone else and receive the
fees for conducting the auction.
Value for tax purposes for person dealing
in used or second hand goods as given in
the CGST Rules, 2017 will be the difference
between the selling price and purchase price.
Where selling price is less than purchase price,
the value shall be ignored implying that there
will be no tax liability. This would cover
cases where the applicant has paid GST on
purchase of the said goods and not availed
the input tax credit of the same.
The Authority for Advance Ruling, Maha-
rashtra held that GST liability is to be dis-
charged by the applicant on the difference
between selling price and purchase price of
used goods.WEEKLY REVIEW