Page 24 - GSTL_ 28th May 2020_Vol 36_Part 4

J84 GST LAW TIMES [ Vol. 36

VALIDITY OF ADVANCE RULING OBTAINED UNDER GST LAWS
VALIDITY OF ADVANCE RULING OBTAINED UNDER GST
LAWS BY SUPPRESSING MATERIAL FACTS
VALIDITY OF ADVANCE RULING OBTAINED UNDER GST LAWS
By
CS Dr. M. Govindarajan
PRACTISING COMPANY SECRETARY

Statutory provision
Section 104(1) of the Central Goods and Services Tax Act, 2017 (‘Act’ for
short) provides that where -
• the Authority; or
• the Appellate Authority; or
• the National Appellate Authority,
finds that advance ruling pronounced by it under Section 98(4) or under Section
101(1) or under Section 101C has been obtained by the applicant/appellant by
fraud or by suppression of material facts or by misrepresentation of facts, it may,
by order, declare such ruling to be void ab initio and thereupon all the provisions of
this Act or the rules made thereunder shall apply to the applicant or the appellant
as if such advance ruling had never been made. It also provides that no such order
shall be passed unless an opportunity of being heard has been given to the appli-
cant/appellant.
Analysis of the statutory provision
As per statutory provision stated above, if the applicant, who sought ad-
vance ruling before the Authority for Advance Ruling, suppresses certain mate-
rial facts, the advance ruling so obtained will be liable to be declared as void ab
initio. The issue has been analysed by the Appellate Authority for Advance Rul-
ing in the under-mentioned case.
In Re : Arihant Enterprises [2019 (24) G.S.T.L. 155 (A.A.R. - GST)], the ap-
plicant used to purchase ice creams from their franchisor Kamaths Ourtimes Ice
Creams Private Limited and to resell the same in wholesale as well as in retail
sale packages. The ice creams were sold to customers without any further pro-
cessing/alteration/structural or chemical change. The applicant sought for ad-
vance ruling on the following questions :-
(i) Whether supply of ice cream by the applicant from its retail outlets
would be treated as supply of goods or supply of service or a com-
posite supply and subject to GST?
(ii) Whether the supply, not being a composite supply, would be treat-
ed as supply of service in terms of Entry 6(b) of Schedule II of the
CGST Act, 2017 and leviable to CGST @ 2.5% in terms of Notifica-
tion No. 11/2017-C.T. (Rate), as amended by Notification No.
46/2017-C.T. (Rate) [Serial No. (i) Entry No. 7] of the Notification?
(iii) In case the supply is held to be ‘composite supply’, whether the tax-
ability of the same should be treated as supply of service in terms of
Entry 6(b) of the Schedule II of the CGST Act, 2017 or should be tax-
able on the basis of nature of principal supply in accordance with
Section 8 of the Act?
GST LAW TIMES  28th May 2020  24