Page 118 - GSTL_11th June 2020_Vol 37_Part 2

204 GST LAW TIMES [ Vol. 37
10. In light of the above, the appellant seeks to submit that the authori-
ties below have erred in relying upon the definition provided in Companies Act,
1956, without any justification whatsoever. The appellant therefore submits that
changes in inventory of work in progress as appearing in the Financial Statement
cannot be included in the turnover, as the amount reflects purchases and not
sales. To further elaborate, it has been explained that the opening and closing
balance of changes in inventory of work in progress, represents purchased invento-
ries during the year. It is therefore submitted that the purchase of stocks cannot
be considered as turnover, and the lower authorities have erred in holding oth-
erwise. The Appellant submits that if the said increase in inventory is excluded,
the balance turnover would be less than Rs. 10 lakhs and hence the appellant
would be eligible to claim the exemption.
11. Per contra the Ld. DR has supported the findings in the orders
passed by the lower authorities.
12. We have heard both sides and have perused the appeal paper book.
We have also gone through the judgment of the Apex Court and the publications
of the ICAI.
13. The appellant has claimed exemption under the following entry of
Notification No. 25/2012-S.T. :
“…..the Central Government, being satisfied that it is necessary in the pub-
lic interest so to do, hereby exempts the following taxable services from the
whole of the service tax leviable thereon under Section 66B of the said Act,
namely :-
….
6. Services provided by -
i.
ii. ….
(b) an individual as an advocate or a partnership firm of advocates by
way of legal services to, -
(i) an advocate or partnership firm of advocates providing legal ser-
vices ;
(ii) any person other than a business entity; or
(iii) a business entity with a turnover up to rupees ten lakh in the
precedineg financial year; or
(emphasis supplied)
….
….”
14. We find that the expression “turnover” is not defined in the Notifi-
cation No. 25/2012-S.T. or in the Finance Act, 1994, and hence in order to inter-
pret the meaning of the said term, in Serial No. 6 of Notification No. 25/2012-
S.T., the common parlance meaning of the said term as understood by those deal-
ing in accounts and taxation would have to be taken.
15. We find that the meaning of the said term has already been authori-
tatively explained by the Hon’ble Apex Court in the in CIT v. Punjab Stainless
Steel Indus. 2014 (307) E.L.T. 214 (S.C.), in which the Hon’ble Supreme Court held
as under :
18. In the aforestated circumstances, one has to look at the meaning of the
term ‘turnover’ in ordinary accounting or commercial parlance.
GST LAW TIMES  11th June 2020  118