Page 147 - GSTL_20th August 2020_Vol 39_Part 3

2020 ] IN RE : HALLIBURTON OFFSHORE SERVICES INC. (DRILL BITS) 361
have its full operation or that the provisions embraced in the non obstante clause
would not be an impediment for an operation of the enactment. [Ref. : Chanda-
varkar Sita Ratna Rao v. Ashalata.S.Guram - AIR 1987 SC 117]
6.4.4 Accordingly, as Section 31(7) would clearly override the default
provisions in relation to invoicing where there is a sale on approval or return, it
would be pertinent to determine what constitutes ‘Goods sent on approval or on
sale or return’ as that would be relevant to determine the time of supply of drill
bits, and hence the point of time when liability to pay tax arises.
6.5 In view of the above, it is submitted that the applicant raises an in-
voice at the time of consumption of drill bits or on expiry of 6 months from the
date of removal, whichever is earlier, in terms of Section 31 of CGST Act. Given
the above background and analysis of the positions adopted by the applicant, it
is submitted that the applicant is not only required to import drill bits for supply
to ONGC but it is also required to undertake the transportation and insurance of
drill bits till the time such drill bits are delivered to ONGC’s location.
6.6 Thus, considering the provisions of the GST statutes, the Customs
Notification, Notifications issued under IGST/CGST Acts and EC dated 19 July,
2016 issued to the applicants, it is submitted that there are two events involved in
the transaction of supply of drill bits to ONGC viz. import of goods into India by
the applicant and inter-State/intra-State supply of drill bits by the Applicant to
ONGC’s location. The aforesaid has been elaborated in the ensuing paragraphs :
6.6.1 The charging provisions for intra-State supply and import/inter-
State are different.
6.6.2 In terms of the charging provision under the CGST Act for intra-
State supply, GST is levied on a ‘supply’ of goods and/or services :
“9. Levy and collection. - (1) Subject to the provisions of sub-section (2),
there shall be levied a tax called the central goods and services tax on all in-
tra-state supplies of goods or services or both, except on the supply of alco-
holic liquor for human consumption, on the value determined under Sec-
tion 15 and at such rates, not exceeding twenty per cent., as may be notified
by the Government on the recommendations of the Council and collected in
such manner as may be prescribed and shall be paid by the taxable person.”
(emphasis supplied)
6.6.3 Whereas, inter-State supplies, including imports, the charging
provision is contained under Section 5 of the Integrated Goods and Services Tax
Act, 2017 (‘IGST Act’), which reads as follows.
“5. Levy and collection. - (1) Subject to the provisions of sub-section (2),
there shall be levied a tax called the integrated goods and services tax on all
inter-State supplies of goods or services or both, except on the supply of al-
coholic liquor for human consumption, on the value determined under Sec-
tion 15 of the Central Goods and Services Tax Act and at such rates, not ex-
ceeding forty per cent., as may be notified by the Government on the rec-
ommendations of the Council and collected in such manner as may be pre-
scribed and shall be paid by the taxable person :
Provided that the integrated tax on goods imported into India shall be levied and
collected in accordance with the provisions of Section 3 of the Customs Tariff Act,
1975 on the value as determined under the said Act at the point when duties of cus-
toms are levied on the said goods under Section 12 of the Customs Act, 1962.”
6.7 In terms of the foregoing, it is submitted that apart from the levy of
GST on intra-State and inter-State supplies of goods within India, in relation to
imports of goods into India, the taxing event is that of “import”, and the IGST
thereon is levied and collected in terms of the Customs Tariff Act, 1975.
GST LAW TIMES  20th August 2020  147