The Authority for Advance Ruling ( AAR ), Madhya Pradesh had rejected to give an opinion on an application by holding that the subject matter was already under the consideration of the tax department.
The applicants, assessees under Central Excise Act, 1944, availed credit of duty paid on inputs/capital goods and service tax paid on services used in or in relation to the activity of extraction/manufacture of coal prior to the implementation of GST.
The applicants claimed that after the GST- rollout, the ‘supply’ has become the taxable event and shifting of coal from coal mines of the applicant to their power plant for self-use or captive consumption shall be out of ambit of ‘Supply’. The applicants sought for a clarification that whether they are entitled to carry forward the accumulated cenvat credit as reflected in its Excise returns for the month of June 2017 to GST regime under Section 140 of the CGST Act and if yes, whether the accumulated Cenvat Credit so carried forward, not being the credit availed under the GST regime, is required to be adjusted/restricted in the manner prescribed under Rule 42 and 43 of the CGST Rules 2017.?
During the course of the personal hearing, the applicant submitted that the applicant had already claimed the Credit under TRAN-1 which has been duly filed by them with the jurisdictional officers.
It was submitted on behalf of the department that the applicant has already claimed the credit amounting to Rs.223.35 Crores vide TRAN-1 and the same has been under scrutiny of the jurisdictional officers. It was also pointed out in the letter that the applicant company has also been audited by cost audit and certain objections have been raised through memos issued to the applicant.
Since the question raised before the AAR, have already been under consideration and scrutiny of the department, the authority decided to reject the application.
“Now having regard to the Proviso to Section 98(2) of the CGST Act 2017, we are of firm opinion that applicant had not only raised this particular issue, in respect of which Advance Ruling is sought vide application under consideration, before the jurisdictional officers but also the department has already undertaken audit of the accounts of the applicant and raised some objections on the same. We find that the applicant has also agreed to this fact during the course of the personal hearing,” the authority said.
“In view of the above, when the question raised before does not fall within the ambit of Section 97(2) and be that as it may, the issue has already been pending before the departmental authorities we do not find any reason to take up the matter on merits. In view of the clear provisions given under Section 97 and Section 98(2) supra, the application deserves to be rejected at the stage of admission only,” it said.
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