Page 197 - GSTL_23rd July 2020_Vol 38_Part 4

2020 ] IN RE : ORDNANCE FACTORY, BHANDARA 563
tual taxable amount and GST leviable thereon
mentioned in the tax invoices, as the transac-
tion of L.D. is separate from the transaction of
the receipt of the goods or services. It is mani-
fest from the two separate accounting codes,
maintained by the Appellant, one for the re-
ceipt of goods and another for deduction of
L.D. from the suppliers’ due, that taxable val-
ue of the goods or services even in L.D. cases
are being recorded in their respective ac-
counts having its value equal to those men-
tioned in the tax invoices raised by the sup-
pliers of the Appellant. The transaction relat-
ed to L.D. is being recorded in separate ac-
counting code. Maintenance of such account-
ing codes by the Appellant clearly shows that
the Appellant is paying the actual taxable
amount and GST thereon to its suppliers, as
mentioned in the tax invoices raised by its
suppliers. Further, the reflection of the illus-
trated sample invoices in the GSTR-2A of the
Appellant further substantiates the Appel-
lant’s claim that the suppliers are also aware
of their liability to pay the actual GST and not
the lesser amount of GST are being paid by
the suppliers, even in the cases where there is
deduction of liquidation damages from the
payment made towards such suppliers. In
view of this discussions, it is observed that
the Appellant was rightful in challenging the
ruling pronounced by AAR in this regard,
and accordingly, they are not required to re-
verse the ITC on account of the deduction of
L.D. from the payment made to the suppliers.
Question : (7) Being a part of Findings in Q. 7 :-
the Ministry of Defence, Gov- Since the Appellant has been held to be “the
ernment of India, whether the Central Government” as per the discussions
following notifications are ap- and findings carried out hereinabove, hence
plicable to our organisation and all the three aforementioned notifications in
what shall be the impact of Question No. 7 to the application should be
such notifications :- applicable to Ordnance Factory Bhandara.
(a) Notification No. 2/2018-
Central Tax (Rate), in relation to
services by an arbitrator or an
advocate to our organisation.

GST LAW TIMES  23rd July 2020  197