Page 26 - GSTL_6th August 2020_Vol 39_Part 1

J8 GST LAW TIMES [ Vol. 39
 The revised guidelines issued by the MHA on 1-5-2020 does not cast
any obligation for obtaining the mandatory cover as prescribed un-
der the guidelines dated 15-4-2020 creating a maze of confusion on
the obligatory nature of such expenses.
It is pertinent to examine the insurance policy to determine the nature and cover-
age in order to arrive at the availability of ITC based on the purpose and targeted
cover of the same. The mandatory nature as prescribed under the MHA’s order is
intended to cover only the workers of the organization concerned but for the fami-
ly members of the employees. Moreover, it is not clear, what would be the treat-
ment for the medical insurance policy or mediclaim policy obtained by the assessee
prior to the issuance of instant guidelines dated 15-4-2020! The department may
dispute the same, since during the time of procuring such policy, strict restriction
was there under Section 17(5) for claiming ITC on the health insurance. On the con-
trary, a view may be taken that proportionate ITC is available to the assessee. In
absence of clarity on the issue, it may invite unnecessary litigations in the trade.
In the light of the aforesaid, it can be said that the business across the
country is going through a crucial phrase in such a slowing down economic dy-
namics and choking economic environment, therefore, the timely intervention of
the Government is of supreme importance for its revival. Thus, the businesses
desperately need to optimize available resources at all levels. Any uncertainty or
ambiguity may turn out to be counterproductive and invite adverse impact on
the recovery process. Therefore, it is hoped that C.B.I. & C. would come up with
suitable clarifications on the said issues at the earliest.

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[Continued from page J5]

Bad decisions and orders have a way of perpetuating themselves. Section
103 of the CGST Act, 2017 makes it abundantly clear that an advance ruling
binds only the applicant and the jurisdictional officer. Advance Rulings do not
have the force of binding judicial precedent. But this does not stop the Revenue
Officers from relying on AAR orders during investigation or inquiry. They try to
persuade the gullible assessees to admit the liability on the basis of AAR rulings.
Thus, AAR and AAAR orders are becoming judicial precedents through back-
door.
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GST LAW TIMES  6th August 2020  26