Page 146 - GSTL_30th April 2020_Vol 35_Part 5

632 GST LAW TIMES [ Vol. 35
supply of stationery articles that are purchased from the registered
dealers and supplied, as it is, to the Government departments,
against the orders, at no profit or no Loss. The applicant contends
that such transactions are exempted as the applicant is acting like a
pure Agent. Thus the applicant raised question as to whether it is
pure agent transaction and eligible for exemption or not and if taxa-
ble, the relevant entry/notification number.
“Pure agent”, in terms of Rule 33 of CGST Rules, 2017, means
(a) a person who enters into a contractual agreement
with the recipient of supply to act as his pure
agent to incur expenditure or costs in the course
of supply of goods or services or both;
(b) neither intends to hold nor holds any title to the
goods or services or both so procured or supplied
as pure agent of the recipient of supply;
(c) does not use for his own interest such goods or
services so procured; and
(d) receives only the actual amount incurred to pro-
cure such goods or services in addition to the
amount received for supply he provides on his
own account.
It could be seen from the above that for a person to act as a pure
agent he must be a supplier of goods or services or both and then he
must procure certain goods or services for the said supply, for
which, he incurs expenditure, under the agreement, and collects the
said expenditure in addition to the value of his supply, from the re-
cipient. The amounts so collected are called reimbursable expenses
and the person is called pure agent.
In the instant case the applicant, being the part of Government
of Karnataka, procures the required stationery and distributes the
same to various departments, but does not procure any other ser-
vices or goods or both for the supply/distribution of the stationery
items and hence the applicant does not qualify to be a pure agent.
Thus the impugned activity of supply of stationery items to
other Departments of same Government of Karnataka who have not
obtained separate registration under the GST Act does not qualify as
supply in terms of Section 7(1)(a) of the CGST Act, 2017, as explained
at para 10(a) supra. However, if supply of stationery items is done to
the other Departments of Government of Karnataka who have ob-
tained separate registration under the GST Act, then the transaction
qualify as supply in terms of Section 7(1)(a) of the CGST Act, 2017
and liable to tax under GST.
(i) Taxability of Transportation charges paid by the Applicant
This category covers Question Number 16 & 17, which deals
with transportation services received by the applicant. The Applicant
supplies the text books & other printed forms/PUC answer booklets

GST LAW TIMES  30th April 2020  146