In terms of the Notification No. 10/2017- Integrated Tax (Rate) dated 28.06.2017, in the case of import of goods on CIF basis, the applicant is liable to pay GST on the component of Ocean freight paid by the foreign supplier to the shipping company.
Levy of GST— In the instant case, the Applicant is a limited company engaged in manufacturing of paper out of indigenous and imported waste paper. As regard to the imported waste paper, the applicant has submitted that the Customs duty is paid on the CIF value. Once the paper is manufactured, the applicant shows value of goods and freight separately on the invoice and pays GST on the invoice value.
The applicant has sought Advance Ruling as follows : -
i. When GST has been paid on the freight in the case of indigenous supplies, whether the supplier is required to pay again GST on the freight under RCM.
ii. When the GST has been paid on the ocean freight in the case of imports on the CIF value and the value of the ocean freight is included in the value of the imported goods, whether any further GST liability is there under RCM.
The Notification No. 13/2017-CT (Rate) dated 28.06.2017 (as amended) is squarely applicable on them and they are liable to pay the GST on the freight paid, under the reverse charge mechanism. As far as double taxation is concerned, we observe that this is a revenue neutral exercise, having no additional financial impact on the applicant.
the services supplied by the foreign shipping entity of transportation of goods in a vessel to a port in India is an 'inter-state supply' in terms of section 7 of the IGST Act, 2017. Hence, IGST is leviable on the same under Section 5 of the IGST Act. As per the charging section i.e. Section 5, IGST has to be paid by the taxable person.
Held that— In respect of question no. 1, it is held that, In term of Notification No. 13/2017-Central Tax (Rate) dated 28.06.2017 (as amended) the applicant is liable to pay GST under reverse charge mechanism, on the freight paid.
In respect of question no. 02, it is held that, the applicant is liable to pay IGST on transportation of goods by vessels under Reverse Charge Mechanism (RCM) under Notification No. 10/2017-Integrated Tax (Rate) dated 28.06.2017, as amended.
In terms of the Notification No. 10/2017- Integrated Tax (Rate) dated 28.06.2017, in the case of import of goods on CIF basis, the applicant is liable to pay GST on the component of Ocean freight paid by the foreign supplier to the shipping company.
Levy of GST— In the instant case, the Applicant is a limited company engaged in manufacturing of paper out of indigenous and imported waste paper. As regard to the imported waste paper, the applicant has submitted that the Customs duty is paid on the CIF value. Once the paper is manufactured, the applicant shows value of goods and freight separately on the invoice and pays GST on the invoice value.
The applicant has sought Advance Ruling as follows : -
i. When GST has been paid on the freight in the case of indigenous supplies, whether the supplier is required to pay again GST on the freight under RCM.
ii. When the GST has been paid on the ocean freight in the case of imports on the CIF value and the value of the ocean freight is included in the value of the imported goods, whether any further GST liability is there under RCM.
The Notification No. 13/2017-CT (Rate) dated 28.06.2017 (as amended) is squarely applicable on them and they are liable to pay the GST on the freight paid, under the reverse charge mechanism. As far as double taxation is concerned, we observe that this is a revenue neutral exercise, having no additional financial impact on the applicant.
the services supplied by the foreign shipping entity of transportation of goods in a vessel to a port in India is an 'inter-state supply' in terms of section 7 of the IGST Act, 2017. Hence, IGST is leviable on the same under Section 5 of the IGST Act. As per the charging section i.e. Section 5, IGST has to be paid by the taxable person.
Held that— In respect of question no. 1, it is held that, In term of Notification No. 13/2017-Central Tax (Rate) dated 28.06.2017 (as amended) the applicant is liable to pay GST under reverse charge mechanism, on the freight paid.
In respect of question no. 02, it is held that, the applicant is liable to pay IGST on transportation of goods by vessels under Reverse Charge Mechanism (RCM) under Notification No. 10/2017-Integrated Tax (Rate) dated 28.06.2017, as amended.