Page 29 - GSTL_ 28th May 2020_Vol 36_Part 4

2020 ] VALIDITY OF ADVANCE RULING OBTAINED UNDER GST LAWS J89
The Appellate Authority for Advance Ruling also did not accept the con-
tention of the respondent that the investigation proceedings initiated by DGGI
were not pending against the applicant and only against KOTI. Though techni-
cally, the proceedings were not pending against the respondent on the date of
filing of the application for advance ruling, it is clear and apparent from the
deposition of the directors of KOTI to file an application before the Authority for
Advance Ruling on the same issue of classification of ice cream sold through the
parlour which was taken up by DGGI. This is not an apparent coincidence as
made out to be by the respondent. This reflects the deliberate intention on the
part of the franchisor and the franchisee to subvert the investigation proceedings
and also a purposeful objective to hide facts which critical to the Authority for
Advance Ruling.
The Appellate Authority for Advance Ruling held that the respondent
has attempted to show the technical errors on filing the appeal but when the facts
of the case are seen, it is very clear that there is a pre-meditated and a conscious
action on the part of the respondent to undermine the process of Advance Ruling
and an attempt to use it to satisfy their own ends.
The Appellate Authority for Advance Ruling held that the order of the
Authority for Advance Ruling is void ab initio as it is vitiated by the process of
suppression of material facts.
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[Continued from page J80]

(i) Registered person, who has paid GST on receipt of advance
amount, can adjust the said GST amount against his tax liability
through his regular GST return i.e. GSTR-3B when whole of the ad-
vance amount is refunded.
(ii) Circular explaining only one way of tax adjustment in respect of re-
fund voucher is not consistent with the provisions of the law. Hence
the same is ultra vires the GST law to that extent.
Conclusion
The C.B.I. & C. issues circular frequently to clarify the various issues per-
taining to GST. The said clarifications bring consistency in application of law and
certainty to stakeholders. However, clarification in circular should be consistent
with the provision of law and in line with the spirit of law to facilitate the trade
and decrease litigation. In absence of any further clarifications, field formations
will interpret the circular literally and will dispute the adjustment of GST paid
on advance amount through GSTR-3B. Thus C.B.I. & C. is requested to issue
suitable modification in the above circular to avoid unnecessary litigation.
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GST LAW TIMES  28th May 2020  29