GST WEEKLY UPDATE :06/2024-25 (12.05.2024) By CA Vipul Khandhar

-By CA Vipul Khandhar

1. E way Bill FAQs – Miscellaneous (new update):

• What is Over Dimensional Cargo? Over Dimensional Cargo mean a cargo carried as a single indivisible unit and which exceeds the dimensional limits prescribed in rule 93 of the Central Motor Vehicle Rules 1989 made under the Motor Vehicles Act, 1988.

• How the consignor is supposed to give authorization to transporter or e-commerce operator and courier agency for generating PART-A of e-way bill? It is their mutual agreement and way out to do the same. If a transporter or courier agency or the e-commerce operator fills PART-A, it will be assumed by the department that they have got authorization from consignor for filling PART-A.

• In case of Public transport, how to carry e-way bill? In case of movement of goods by public transport, e-way bill shall be generated by the person who is causing the movement of the goods, in case of any verification, he can show e-way bill number to the proper officer.

• What is the meaning of consignment value? It is the value of the goods declared in invoice, a bill of challan or a delivery challan, as the case may be, issued in respect of the said consignment and also include Central tax, State or Union territory tax, Integrated tax and Cess charged, if any. But, it will not include value of exempt supply of goods, where the invoice is issued in respect of both exempt and taxable supply. It will also not include value of freight charges for the movement charged by transporter.

• In case of movement of goods by Railways, is there a requirement for railway to carry e-way bill along with goods? In case of movement of goods by Railways, there is no requirement to carry e-way bill along with the goods, but railways has to carry invoice or delivery challan or bill of supply as the case may be along with goods. Further, e-way bill generated for the movement is required to be produced at the time of delivery of the goods. Railways shall not deliver goods unless the e-way bill required under rules is produced at the time of delivery. But for the purposes of e-way bill, the expression ‘transported by railways’ does not include the ‘leasing of parcel space by Railways’.

• If the value of the goods carried in a single conveyance is more than 50,000/- though value of all or some of the individual consignments is below Rs. 50,000/-, does transporter need to generate e-way bill for all such smaller consignments? As rule 138(7) will be notified from a future date, hence till the notification for that effect comes, transporter needs not generate e-way bill for consignments having value less than Rs 50,000/-, even if the value of the goods carried in single conveyance is more than Rs 50,000/-, till the said sub-rule is notified.
• Does the vehicle carrying goods from CSD to unit run canteens need e-way bill? No, these are exempted supply and therefore have been exempted from the requirement of carrying e-way bill.

• Is the e-way bill required for the movement of empty cargo containers? No, such movement has been exempted from e-way bill. • Does the movement of goods under Customs seal require e-way bill? No, such movement has been exempted from e-way bill.

• Does the movement of goods which are in transit to or from Nepal/Bhutan, require e-way bill for movement? No, such movement has been exempted from e-way bill.

• Is the temporary vehicle number allowed for e-way bill generation? Yes, temporary vehicle number can also be inserted as vehicle number for the purpose of e-way bill generation.

• Whether e-way bill is required for intra -State movement of goods? At present e-way bill is required only for inter-State movement of goods. For intra State movement of goods the requirement for e-way bill will be introduced in a phased manner, for which rules will be notified by respective states separately.

• I am dealer in tractors. I purchased 20 tractors from the manufacturer. These tractors are not brought on any motorized conveyance as goods but are brought to my premise by driving them. Also, these tractors have not got the vehicle number. Is e-way bill required in such cases? E-way bill is required in such cases. The temporary number or any identifiable number with the tractor have to be used for filling details of the vehicle number for the purpose of e-way bill generation.

• Who is responsible for EWB generation in case DTA sales from SEZ/FTWZ? There is no special provision for such supply and hence the registered person who causes movement of goods shall be responsible for the generation of e-Way bill as per the rules.

• In many cases where manufacturer or wholesaler is supplying to retailers, or where a consolidated shipment is shipped out, and then distributed to multiple consignees, the recipient is unknown at the time the goods are dispatched from shipper’s premises. A very common example is when FMCG companies send a truck out to supply kirana stores in a particular area. What needs to be done in such cases? In such cases, movement is caused on behalf of self. No supply is being made. In such cases, delivery challan may be used for generation of e-way bills. All the provisions for delivery challan need to be followed along with the rules for e-way bills.

• What should be the value in e-waybill in case goods are sent on lease basis as the value of machine is much higher than leasing charges? The value of goods needs to be mentioned as per the explanation 2 of the sub– rule (1) of rule 138.

• Expired stock has no commercial value, but is often transported back to the seller for statutory and regulatory requirements, or for destruction by seller himself. What needs to be done for such cases of transportation of the expired stock? E-way bills are required even in cases where goods are moved for reasons other than supply. Delivery Challan has to be the basis for generation of e-way bill in such cases.

• Whether shipping charges charged by E-commerce companies needs to be included in ‘consignment value’ though the same is not mentioned on merchant’s invoice? Consignment value of goods would be the value determined in accordance with the provisions of section 15. It will also include the central tax, State or Union territory tax, integrated tax and cess charged, if any. So shipping charges charged by E- by the e-commerce companies need not be included in the ‘consignment value’.

• Where an invoice is in respect of both goods and services, whether the consignment value should be based on the invoice value (inclusive of value of services) or only on the value of goods. Further, whether HSN wise details of service is also required to be captured in Part A of the e-way bill in such case. Consignment value and HSN needs to be determined for goods only not for services as only the goods are in movement and e-way bill needs to be generated accordingly.

2. The ICEGATE CBIC issued an update on Registration process encompasses five key sections:

Registration process has 5 key sections: 1) Role Selection 2) GSTIN Details Verification 3) User Details Verification 4) Mobile and Email Verification 5) Role Registration Form Submission.

3. AAR & Important Judgements:

(i) AAAR On GST ITC Limited to Employer’s Cost for Canteen Facility, Excluding Employee Contributions:

(Applicant – Tata Motors Limited)

In re Tata Motors Limited (GST AAAR Gujarat) Whether input tax credit (ITC) available to applicant on GST charged by service provider on canteen facility provided to employees working in factory? 2. If ITC is available as per question no.

above, whether it will be restricted to the extent of cost borne by the Applicant (employer)? (i) Input Tax Credit (ITC) will be available to the appellant on GST charged by the service provider in respect of canteen facility provided to its direct employees working in their factory, in view of the provisions of Section 17(5)(b) as amended effective from 01.02.2019 and clarification issued by CBIC vide Circular No. 172/04/2022-GST dated 06.07.2022, read with provisions of Section 46 of the Factories Act, 1948, and read with provisions of the Gujarat Factory Rules, 1963 and clause (ii) below; (ii) ITC on the above is restricted to the extent of the cost borne by appellant for providing canteen services to its direct employees, but disallowing proportionate credit to the extent embedd in the cost of food recovered from such employees.

(ii) AAR On Optical Line Terminals not Eligible for Concessional Duty rate:

(Applicant – Nokia Solutions and Networks India Private Limited)

The Customs Authority of Advance Ruling in Mumbai deliberated on the eligibility of Optical Line Terminals (OLTs) for a concessional Basic Customs Duty (BCD) rate of 10%. Nokia Solutions and Networks India Private Limited sought clarification, triggering a detailed analysis.
The applicant, engaged in network equipment manufacturing and trading, imports GPON OLTs, seeking the concessional BCD rate. Despite prior classification and clearance at a reduced rate, recent circulars led to BCD denial. The Circular No. 08/2023 clarified exclusion categories, potentially affecting the import of OLTs.

The contention arises from categorizing OLTs under “Combination of one or more of Packet Optical Transport Product or Switch (POTP or POTS).” The applicant argues the distinction between OLTs and POTPs/POTSs in terms of functionality, bandwidth, and deployment, asserting eligibility for the concessional rate.

Despite the applicant’s interpretation, the ruling hinges on Circular No. 08/2023, which designates OLTs as excluded items. While the applicant advocated for independent analysis, legal precedent and Customs Act provisions prioritize adherence to board directives, barring interference with appellate discretion.

Conclusion: The ruling, aligned with Circular No. 08/2023, concludes that Optical Line Terminals do not qualify for the concessional BCD rate. This decision underscores the impact of regulatory interpretations on trade practices, emphasizing adherence to official directives in tariff classifications.

Disclaimer:

This publication contains information for general guidance only. It is not intended to address the circumstances of any particular individual or entity. Although the best of endeavor has been made to provide the provisions in a simpler and accurate form, there is no substitute to detailed research with regard to the specific situation of a particular individual or entity. We do not accept any responsibility for loss incurred by any person for acting or refraining to act as a result of any matter in this publication.

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