GOVERNMENT RITORY OF DELHI OF NATIONAL Cap} DEPARTMENT OF TRADN ANE, TAXES: % ; VYAPAR BHA (POLICY BRANCH) WAN, L.P.ESTATE, NEW DELHI-110 002 No.F.3 (66)//Policy-GST/2017/ SIV Di ated: %\ rag CIRCULAR NO, uz018.9st (Ref .Circular No. §2/26/2018.GST of Contral Tax) Subject: Clarification regardin pe if applicability of GST on various goods and services— Representations have been recei i ;
rates on the following items: ived seeking clarification in respect of applicable GST
(i) Fortified Toned Milk ‘
(ii) Refined beet and cane sugar
(iii) Tamarind Kernel Powder (Modified & i
(iv) Drinking water Re ET Mace Oa)
(vy) Plasma products
(vi) Wipes using spun lace non-woven fabric
(vii) Real Zari Kasab (Thread)
(viii) Marine Engine $
(ix) Quilt and comforter
(x) Bus body building as supply of motor vehicle or job work
(xi) Disc Brake Pad
2. The matter has been examined. "The issue-wise clarifications are discussed below:
3.1 Applicability of GST on Fortified Toned Milk: Representations have been received seeking clarification regarding applicability of GST on Fortified Toned Milk.
| and as per S.No. 25 of notification No. 2/2017- k and pasteurised milk, including separated milk, added sugar or other sweetening matter, der tariff head 0401 attracts NIL hed with vitamins and milk fortified
3.2 Milk is classified under heading 040 State Tax (Rate) dated 30.06.2017, fresh mill milk and cream, not concentrated nor containing excluding Ultra High Temperature (UHT) milk falling un rate of GST, Further, as per HSN Explanatory Notes, milk enricl minerals is classifiable under HSN code 0401. Thus, it is clarified that toned (with vitamins *A’ and ‘D’) attracts NIL rate of GST under HSN Code 0401.
cane sugar:Doubts have been raised Ade S. No. 91 of schedule 1 of OQ a
4.1 Applicable GST rate on refined beet and regarding GST rate applicable on refined beet and cane sugar. J notification No. 1/2017-StateTax dated 30,06.2017,.
kinds of beet and cane supar falling under he Fa Tote oe ie has been preseribod on al
4.2 Doubts seem to have arisen in ' Schedule fication No. aia dated Shinn ee GsT bin goods, oiet tariff items 1701 91 and 1701 99 including refined Seale aan vouring or colouring matter, sugar cubes (other than those which attmuct 95 sap: rd or Nil GST)",
4.3. It is clarified that by virtue of specific exclusion i hans under 5% category [at the said S.No, 91 of eile Pavan dated 30.06.2017] gets excluded from the S.No. 32 A of Schedule I. As ail ae cane sugar falling under heading 1701 are covered by the said Ga 8. Me eee I, these would get excluded from 8. ‘ a a No, 32 A of Schedule II, and thus would attract GST @ 44 Accordingly, it is clarified that beet and cane sugar, including refined beet a * * : ugar, will fall under heading 1701 and attract se Getias te
5.1 Applicable GST rate on treated (modified) tamarind icrnal ; der and plain (unmodified) tamarind kernel powder: Representation have ee seeking clarification regarding GST rate applicable on treated (modified) tamarind kernel powder and.
plain (unmodified) tamarind kernel powder. :
Se, There are two grades of Tamarind Kernel Powder (TKP);- Plain (anmodifiedy form (hot, water soluble) and Chemically treated (modified) form (cold, water soluble). *
5.3 As per S.No. 76 A of schedule I of notification No. 1/2017-StateTax dated
30.06.2017, 5% GST rate was prescribed on Tamarind Kernel powder falling under chapter
13. However, certain aoubts have been expressed regarding GST rate on Tamarind kernel powder, as the said notification does not specifically mention the word “modified”.
5.4 _ As both plain (unmodified) tamarind kernel powder and treated (modified) tamarind kernel powder fall under chapter 13, it is hereby clarified that both attract 5% GST in terms of the said notification.
6.1 Applicability of GST on supply of safe drinking water for public purpose:
Representations have been received seeking clarification regarding applicability of GST on supply of safe drinking water for public purpose.
62 Attention is drawn to the entry at S.No. 99 of notification No. 2/2017-StateTax (Rate) dated 30.06.2017, by virtue of which water {other than aerated, mineral, purified, distilled, medicinal, ionic, battery, de-mineralized and water sold in sealed container] falling ‘under HS code 2201 attracts NIL rate of GST. QQ a
7.2 Plasma is the clear, straw coloured id portion of blood ieee a blood cells, white blood cells, platelets and vee ee ee taal moc per the explanatory notes to the Harmonized System of Nomenclature Ca stn fall ae description antisera and other blood fractions, whether or nat modified oF obtained by means of biotechnological processes and f : i 1 would fall under HS code 3002.
7.3 Normal human plasma is Specifically mentioned at S. ist I under 180 of Schedule I of the notification No. 1/2017-StateTax tad. Pie ae and ee “9% Coe Obes item falling under HS Code 3002 Gincloding plama pastuci Gould eet 12% GST under S.No. 61 of Schedule IT Of the said notificati peo notification, not specifically covered in
7.4 Thus, a harmonious reading of the two entries would mean that normal human plasma a would attract 5% GST rate under List | (S.No. 186), whereas plasma products would attract 12% GST rate, if otherwise not specifically covered under the said List,
8.1 Appropriate classification of baby wipes, facial tissues and other similar products: Varied practices are being followed regarding the classification of baby wipes, facial tissues and other similar products, and references have been received Tequesting for correct classification of these products. As per the Teferences, these products are’ currently being classified under different HS codes namely 3307, 3401 and 5603 by the industry.
8.2 Commercially, wipes are categorized into various types such as baby wipes, facial wipes, disinfectant wipes, make-up remover wipes etc. These products are generally made by using non-woven fabrics of viscose and polyviscous blend and are sprinkled with demineralized water and various chemicals and fragrances, which impart the essential character to the product. The base raw materials are moisturising and cleansing ‘agents, preservatives, aqua base, cooling agents, perfumes etc, The textile material is present as a carrying medium of these cleaning/wiping components. , 83 According to the General Rules for Interpretation [GRI- 3(b)] of the First Schedule to the Customs Tariff Act (CTA), 1975, “Mixtures, composite goods consisting of different ‘materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3 (a), shall be classified as if they consisted of the QU ——a \ “ie yw material or component wh ich gives them applicable. * Since primary An their exsential character, deciding the classificat‘on, 110n of the art case is imparted by the components which are to be mixed with eee ae S4 As per the explanatory notes to the HSN, woven, i Paresmaie Coated or covered with subst a , cosmetics, soaps or detergents, polishes, creams Preparations. i reproduced as follows :"The heading also excludes: aa ee Nonwoven, impregnated, coated perfumes or cosmetics (Chapter 33), or similar preparations heading 341 or covered with substances or prepa Soaps Preparations .
05), fabric sarees (heading 3401), polishes, oe material is present merely as a carrying me sai ae psig tons 3809)} where the textile and non-woven, impregnated, coated or catered ae » HS code 3307 covers wadding, felt 3401, would cover paper, wadding, fell and nonomne eo on Conmeties. The. HS. code soap or detergent whether or not perfumed”. woven impregnated, coated or covered with 85 Further, as per the explanatoi Q ry notes to the HSN, the he.
felt and nonwovens impregnated, coated or covered with coed 3307 includes wadding, per explanatory notes to the HSN. the heading3401 inches ee avg Similarly, as felt and nonwovens, impregnated, coated or covered with soap or deter race ae perfumed or put up for retail sale. Teer or not
8.6 Thus, the wipes of various kinds (as stated above) are classifiable under heading 3307 or 340] depending upon their constituents as discussed above. Therefore, if the baby. wipes are impregnated with perfumes or cosmetics, then the same would fall under HS code 3307 and would attract 18% GST rate. Similarly, if they are coated with soap or de! lergent, it . ! - " would fall under HS code 3401 and would attract 18% GST. me wen
9.1 Classification and applicable GSF rate on real zari Kasab (thread): Certain doubts have been raised regarding the classification and applicable GST rate on Kasab thread (a metallised yarn) as yarn falling under heading 5605 attracts 12% GST, as per entry 137 of the Schedule-II-12% of the notification No.01/2017-StateTax dated 30.06.2017, while specified embroidery product falling under 5809 and 5810 attracts GST @ 5%, as per entry no. 220 of the Schedule-J-5% of the above-mentioned notification.
9.2 The heading 5809 and 5810 cover embroidery and zari articles. These heading do not cover yarn of any kinds. Hence, while these headings apply to embroidery articles, embroidery in piece, in strips, or in motifs, they do not apply to yarn, including Kasab yarn.
93 Further all types of metallised yarns or threads are classifiable under tariff heading
5605. Kasab (yarn) falls under this heading. Under heading 5605, real zari manufactiired with silver wire gimped (vitai) on core yarn namely pure silk and cotton and finally gilted with gold would attract 5% GST under tariff item 5605 00 10, as specified at entry no. 218A of Schedule-I-5% of the GST rate schedule, Other goods falling under this heading attract oe 12% GST. Accordingly, kasab ey a eee ing ee yarn, j Schedule-11-1296). Thang an metal Including imitation “Kasab” or Sena Ht ls clarified that imitation zari under tari heading 5605," "ade Parlance, would atract a uniform GST rate of
10.1 Applicability of GST o1 lasitioation tepatdiiig OST eéiea or marine engine: Reference has been ;
son Marine En| been received seeking heading 8902, and attract ast@ 5° ine. The fishing vessels are F %, classifiable under Meuron 7.SinteTex Cals) aaiea ee os s No. 247 of ee 1 of the notification No, indes an’ urther, parts: goods heading 8902, DS Sr pcuion Tos Marea eee oe ace feasts + , Customs Tariff Act, 1975 woud dea a GST Se eae 1093 of he I of the notification No. 01/2017-StateTax ace oon virtue of S. No. 252 of Schedule S
10.2 Therefore, it is clarified that th. is : I¢ Supplies of marine engi 3 part of the fishing vessel), falling under tariff item $408 10 ee ae (being a
11.1 Applicable GST rate on cotto:
“Cotton Quilt”. n quilts under tariff heading 9404-Scope of the term
11.2 Cotton quilts falling under tari % value of such cotton quilts does wot coeeel See ee rate ie 5% if the sale Schedule I of the notification No. 27/2017-StateTax (rate) dated 06. 7 a oa 257 .
cotton quis, with ale value exceeding Rs.1000 per piece attact a GST rate of 12% (as S. No. 224A of Schedule II of.the said notification), Doubts have been raised as to es constitutes cotton quilt, ic. whether a quilt filled with cotton with cover of cotton, or filled . with cotton but cover made of some other material, or filled with material other than’ cotton
11.3 The matter has been examined. The essential character of the cotton quilt is imparted by the filling material. Therefore, a quilt filled with cotton constitutes a cotton quilt, irrespective of the material of the cover of the quilt, The GST rate would accordingly apply.
12.1 Applicable GST rate for bus body building activity: Representations have been received seeking clarifications on GST rates on the activity of bus body building. The doubts have arisen on account of the fact that while GST applicable on job work services is 18%, the supply of motor vehicles attracts GST @ 28%.
12.2 Buses [motor vehicles for the transport of ten or more persons, including the driver} fall under headings 8702 and attract 28% GST. Further, chassis fitted with engines [8705] and whole bodies (including cabs) for buses [8707] also attract 28% GST. In this context, it is mentioned that the services of bus body fabrication on job work basis attracts 18% GST on such service. Thus, fabrication of buses may involve the following two situations:
a) Bus body builder builds a bus, working on the chassis owned by him and supplies the built-up bus to the customer, and charges the customer for the value of the bus, CL a A tee eS building, and Y builder buil i during the eae a eee Chassis provided by the princi Job-work), liding. certain material aoe et Oy
12.3. In the above co, as , ‘was consumed above, the mad et clarified deca eee is that of bus, and accordingly cy St mentioned facipel at Para 12,2(b) abov 'y Supply would attract ;
prin (not on account of body builder ©, fabrication of OST 28%, and 18% GST as applicable will be a ald neste i
13.1 Applicable GST a ae see . licable GST rate on Dise eki . B sR ee a dise brake pad for canoe Iti ions have been received Shae LOST ae, f Nets, in Chapter 68 or heading 8708 are beng £4 at Practices OF OF 18%, while heading 8708 atracts a GST at oft oe
13.2 Parts and accessori Rh a rics an ries of motor vehicles of headings $701 ae g8708 and attract 28% GST. Further, friction emi ae example, sheets, rolls, strips, segments, discs, wash and articles thereof (for clutches or the like, with a basis of asbestos, py Fi Fads), not mounted, for brakes, for whether oF not combined with textiles or other mineral mineral substances or of cellulose, not combined with textiles or other materials are classifiat $ or of cellulose, whether or 18% GST. lc under heading 6813 and attract
13.3. In the above context, it is mentioned Explanatory :, heading $708 covers “Brakes (shoe, segment, disc, ae ee (plates, —— cylinders, mounted linings, oil reservoirs for hydraulic brakes, etc.); serve. Setee at thereof, while Chapter 68 covers articles of Stone, Plaster, Cement, Asbestos, me similar materials. Further, HSN Explanatory Notes to the heading 6813 specifically excludes:
i) Friction materials not containing mineral materials or cellulose fibre (e.g, those of cork);
ii) Mounted brake linings (including friction material fixed to a metal plate provided with circular cavities, perforated tongues or similar fittings, for disc brakes) which are classified as parts of the machines or vehicles for which _ they are designed (e.g. heading 8708).
13.4 Thus, it is clear, in view of the HSN Explanatory Notes that the said goods, namely “Disc Brake pad” for automobiles, are appropriately classifiable under heading $708 of the Customs Tariff Act, 1975 and would attract 28% GST.
. .
14, _ Difficulty, if any, may be brought to the notice of the Policy Branch immediately.
‘ .
— (H. Rajesh Prasad) Commissioner, GST (State Tax) . PS to the Commissioner, GST(State Tax), Department Copy forwarded for information and necessary action to:
. All Spl/Addl./Joint Commissioners, Department of Trade and Taxes, GNCT of 1-02, Deihi, Vyapar BhawanI.P.Estate, New Delhi _ Joint Director (IT), Department of Trade and Taxes, GNCT of Delhi, Vyapar Bhawan, |.P.Estate, New Dethi-02 for uploading the circular on the website of the department. . i r The President/(General Secretary, Sales Tax Bar Association (Regd.), VyaparBhawan, |.P.Estate, New Delhi.
All Assistant Commissioners/GSTOs, Department of Trade and Taxes, GNcT of Delhi, Vyapar Bhawan, I.P.Estate, New Delhi-02; S oma. + of Trade and Taxes, GNCT of Delhi Vyapar Bhawan, |.P,Estate, New Delhi-02.
. Guard File.
iseaaead SP Assistant Commissione! (Policy-l) aw VYAP; TA tin tanned o. ‘Al NANCH) z R BHAWAN, \.P.ESTATE, NEW DELHI-110 002
0.F.3 (86)i/Policy-Gst/2047/ S25. Fi oa Bo Datad: 2 JB 5p CIRCULAR NO. 45/2018.cst 18-GST LT:
Subject: Clarification r. i i egarding applicability of G gases ST t for the manufacture of petrochemical and meine Sy rdi ee ~ regarding. ~ \References have been received i oO petrole regarding the applicabilit i ‘um, if have b ity of GST of the gases seuies for the manufacture of Petrochemical and chemical products during the course of continuous supply, such as Methyl Ethyl Ketone (MEK) feedstock, petroleum ete. . gases etc, 2, In this context, it may be recalled that clarifications on similar issues {& i products have pneey been issued vide Circular number UROL beer October,2017 of, Ministry of Finance, Government of India and circular No. 08/2018-GST . sae ES of State Tax. These circulars apply mutctis mutandis to other cases involving same manner of supply as mentioned in these circulsrs, However, references have again been received from some of the manufacturers of other petrochemical and chemical products for issue of clarification on ‘applicability of GST on petroleum gases, which are supplied by oil refineries to them on a continuous basis through dedicated pipelines, while, a of the raw material is retained by these manufacturers (recipient of supply), and the quantity is returned to the oil refineries. In this regard, an issue pas arjsen as to ig transaction GST would be leviable on the whole quantity of the principal raw by the oil refinery or on the net quantity retained by the manufacturers of i chernical products.
‘Council in its 28” meeting held on 21.7.2018 discussed this issue and - issuance of a general clarification for petroleum sector that in such be payable by the refinery on the value of net quantity of petroleum manufacture of petrochemical and chemical products.
GST will be payable by is hereby clarified that, in the aforesaid cases, :
d by the’ recipient ‘the net quantity of petroleum gases retaine ou of petrochemical and chemical products. Though, the ost ‘on such returned quantity of petroleum gases, w hen the other person. It is reiterated that this clarification would be (2 8 net billing is done on the amount retained by the Geolpien eee lent.
5: This clarification is issued in the context of the Goods and Service only and past issues, if any, time, | ‘Tax (GST) law will be dealt in accordance With the Jaw prevailing at the material Wes anes (H.Rajesh Prasad) Or No.F.3 (66)//Policy-GSTI20171 SRS-3o Dated Sie peg ™ > Copy forwarded for information and Necessaty action to:
4. All Spl/Addl./Joint Commissioners, Department of Trade and Taxes, GNCT of Delhi, Vyapar Bhawan 1.P.Estate, New Delhi-02.
2. Joint Director (IT), Department of Trade and Taxes, GNCT of Delhi, Vyapar ‘ Bhawan, |,P.Estate, New Delhi-02 for uploading the circular on the website of os the department. .
. 3. The President/General Secretary, Sales Tax Bar Association (Regd.), Vyapar Bhawan, |.P.Estate, New Delhi. ¥ :
ih 4. All Assistant Commissioners/GSTOs Department of Trade and Taxes, GNCT of Delhi, Vyapar Bhawan, |_P.Estate, New Delhi-02.
5. PS to the Commissioner, GST(State Tax), Department of Trade and Taxes, ‘GNCT of Delhi Vyapar Bhawan, |.P.Estate, New Delhi-02.
6. Guard File. o :
P (Ss 2,419, Assistant Commissioner (Policy-1) ' GOVERNMENT oF NATIONAL CAPIT, AL TEI peasant OF TRADE AND TA Oe f 'OLICY BRANCH ; VYAPAR BHAWAN, \P.ESTATE, NEW DELHI. -110 002 No.F.3 (68)//Policy-Gst/2017) $3/-36 D ated: 2 F-Up c' 10.16) .
: iT Circular No. 018-GST of it Subject: Classi ion of fertili; upplied > ;
f ; B amie, OF use in the manufacture of other fertilizers References have been received regarding a clarification as to whether simple fertilizers, such as MOP (Murate of Potash) classified under Chapter 31 and supplied. for use in manufacturing of a complex fertilizer, are entitled to the concessional GST rate of 5%, as applicable in general to fertilizers (i.¢, fertilizers Which are cleared to be used as fertilizers). ~ The-matter has been examined. Chapter 31 of the Customs Tariff Act, 1975 covers s, The fertilizers are mostly used for increasing soil and land fertility, either directly, or cturing of complex fertilizers. However, certain fertilizers and similar goods ‘Chapter may be used for individual purposes like use of molten urea for é and ures used in manufacturing of urea-formaldehyde resins or organic me, the concessional duty rate was prescribed for fertilizers falling iff (notification No. 12/2012-Central Excise), This concessional rate - under Chapter 31 which are clearly to be useddirectly as fertilizers ‘fertilizers, whether directly or through the stage of an Intermediate x structure on fertilizers has been prescribed on the lines of pre- @ of the GST notification is similar to the central excise ges to meet the requirements of GST. These changes were : ‘on the supply of goods while cent s ‘Accordingly. fertilizers falling under ral excise duty was heading 3102, 3193, a!
a early not to be used as fertilizers, attract 5% GST
30.06.2017]. However, the fertilizers j ‘0 the notification No.1/2017-State Tax (Rate) dated ‘ Mizers items falling under the above mentioned headih lings, which ae ree notte be used as fertilizer attract 18% GST|S.No. 42 to 4 notification No. 1/2017 State Tax (Rate)}. The intention ia he ‘ 3 . iy Mn sae to the ees ee fertilizers which are used directly as fertilizers % ae es manufacturing of complex fertilizers which are further used as soil or cro} ms eens “other than clearly to be used as fertilizers” would not cover such Si ; shee making complex fertilizers for use as soil or crop fertilizers. iat are ut for Re in Me cuiouie Aah : ‘ ¢ He {or direct use as fertilizers, or supplied for Tr COM) ii: a . S44.
will attract 5% IGST, Plex fertilizers for agricultural use(soil or crop fertilizers), 5 (H. Rajesh Prasady Commissi GS’ NoF.3 (66)//Policy-GST/2017/ S$ 3/-34 cae ch eee Copy forwarded for information and necessary action to:
Spi./Addi./Joint Commissioners, Department of Trade and Taxes, GNCT of Vyapar Bhawan |.P.Estate, New Delhi-02.
ctor (IT), Department of Trade and Taxes, GNCT of Delhi, Vyapar 1,P.Estate, New Delhi-02 for uploading the circular on the website-of the ai Secretary, Sales Tax Bar Association (Read), Vyapar New Delhi.
onersiGSTOs Department of Trace and Taxes, GNCT of i L.P-Estate, New Delhi-02. { er, GST(State Tax) Department of Trade and Taxes, GNCT . .P.Estate, New Delhi-02.
NEI (Ss and Sah ) Assistant Commissioner (Policy-!)
GOVERNMENT OF NATIO NAL CAPITAL DEPARTMENT OF TRADE OTe TAKES ed (POLICY BRANCH VYAPAR BHAWAN, |,P.ESTATE, NEW DELHI-110 002 No,F.3 (201)//Policy-GsT/2018/ SS 4-sq Dated; Vig CIRCUI No. 17 j20 GST {Ref Circular No. 74/45/2018-GST of Central Tax) Subject: Clarifications of issues under GST related to casual taxable person and r ecovery of excess Input Tax Credit distributed by an Input Service distributor-Reg.
Representations have been received seeking clerification on certain issues under the GST laws, The same have been examined and the clarifications on the same are as below:
S.No | ___ Issue _ 3 j Clarification i 1 “Whether the amount required to be a It has been noted that while applying Z deposited as advance tax while taking | for registration as a casual taxable Tegistration as a casual taxable person (CTP) should be 100% of the estimated ieee tax liability or the estimated tax b payable in cash should be person, the FORM GST REG-1 (S.
No. 11) seeks information regarding the “estimated net tax liability” only and not the gross tax liability. | d after deducting the duc | 2. It is accordingly clarified that the 2 ITC which might be available | amount of advance tax which a casual taxable person is required to deposit while obtaining registration should be calculated after considering the due eligible ITC which might be available to such taxable person.
L Delhi Goods | 1. It jg clarified that in ease of long | wc Act, 2017 (hereinafter | running exhibitions (for @ period more said Act), period of than 180 days), the taxable person | sal taxable person is | cannot be treated as a CTP and thus for extension | such person would be required to | taxable Ybtain registration as @ normal officer for a) 0 a further “peri 0 eyes) od not ding ninety person.
Ys, Various Fepresentations have been | 2 received for further extension of the said period beyond the peri Period of 180 | upload a days, as mandated in law, granting aa fi : Scie om mission to use the Premises for the exhibition and the allotment letter/consent letter shall be treated as the proper document as a proof for his place of business.
3. In such cases he would not be While applying for normal registration the said person should required jo pay advance tax for the purpose of registration,
4. Hevtan surrender such registration once the “exhibition is over,
3. | Representations ave been received | 1. According 1 Section Oi of the regarding the manner of recovery of | DGST Act where the ISD distributes ‘excess credit distributed by an Input | the credit in contravention of the : Distributor (ISD) in| provisions contained in section 20 of ion ©6of §6«6the =o provisions | the DGST Act resulting in excess | in Section 20 of the DGST | distribution of credit to one or more recipients of credit, the excess credit so distributed shall be recovered from | such recipients along with interest and | penalty if any. |
2. The recipient unit(s) who have | received excess credit from ISD may | deposit the said excess amount | voluntarily along with interest if any by | using FORM GST DRC-03.
3. If the said recipient unit(s) docs not come forward voluntarily. necessary | proceedings may be initiated against | the said unit(s) under the provisions of | eae Section 15 or 74 Of the DOST Awe) the case nay be. FORM GsT DRC.07 can be used by the tax authorities in Such casey,
4. It is further Clarified that the Isp Would also be liable to a general Penalty under the Provisions contained in Section 122(1 ix) of the DGST Act, | { 2, Difficulty, if any, in the implementation of this circular should be brought to the Policy Branch, Trade & Taxes Department, Govt, of NCT of Delhi, ( i 4 A (H.Rajesh Prasady— Commissioner, GST (State Tax) Dated: 2-8 No.F.3 (201\/Poliey-GSTi2n18/ S5Y-59 ed for information and necessary action to:
| Spl./Addi,/Joint Commissioners, Department of Tiade and Taxes, GNCT of Vyaper Bhawan |,P.Estate, New Delhi-02.
(IT), Department of Trade and Taxes, GNCT of Delhi, Vyapar Estate, New Delhi-02 for uploading the circular on the website of General Secretary, Sales Tax Bar Association (Regd.), Vyapar tate, New Delhi.
sioners/GSTOs Department of Trade and Taxes, GNCT of
1.P,Estate, New Dethi-02.
, GST(State Tax) Department of Trade and Taxes, wan, 1.P.Estate, New Delhi-02.
~ ne ( Sadahand Sah ) Assistant Commissioner (Policy) GOVE! RNMENT OF NATIONAL CAPITAL TERRITORY OF DELHI Es DEPARTMENT oF TRADE AND TAXES (POLICY BRANCH) VYAPAR BHAWAN, \P-ESTATE, NEW DELHI-110 002 No.F.3 (201)//Policy-GST/2018/ Sbo-bs Dated: 2-1\- 19 CIRCULAR NOB 12018-cs ;
iT {Ref Circular No 72/46/2018-GST of Central Tax) Circular to clarify the procedure in Fespect of return of time expired drugs or Subject:
Various representations have been received secking clarification on the procedure to be followed in respect of return of time expired drugs or medicines under the GST laws. The issues raised in the said representations have been examined and to ensure uniformity in the implementation of the law across the field formations,the Commissioner, in exercise of its powers conferred under section 168(1) of the Dethi Goods and Services Tax Act, 2017 : (hereinafter referred to as the “DGST Act”) hereby clarifies the issue in succeeding paragraphs.
© common trade practice in the pharmaceutical sector is that the drugs or medicines after teferred to as “goods”) are sold by the manufacturer to the wholesaler and by the to the retailer on the basis of an invoice/bill of supply as case may be. It is to mention here that such goods have a defined life term which is normally date of expiry. Such goods which have crossed their date of expiry are to as time expired goods and are returned back to the manufacturer, on h the supply chain.
e retailer’ wholesaler can follow either of the below mentioned ‘the time expired goods:
goods to be treated as fresh supply:
returning the time expired goods is a registered person (other than 2 ' ay, at his option, return the said goods by treating it is as : fresh jnyoice for the same (hereinafter referred to as the, “return ods as shown in the invoice on the basis of which the goods a as the value of such return supply. The wholesaler or ‘who is the recipient of such retum supply, shall be eligible ee EER NTOAIE i Beets ee Teferred to as of the tax levied on the said retum gai te ment of the conditions Specified’ in Section 16 of the DGST Act, TSOn retuming the time expi i g Pired goods is a composition tax; h retum the said goods by issuing a bill of supp! : nae supply si b) “ITO ly and Day tax at the rate appli ae i :
plicable to 3 Ee Payer, In this Scenario there will not be any availability of ITC 4 the recipient of return supply, i c) In case the person returning the ti he :
may retum the said goods by issuing any :
‘ime expired goods is an unregistered Person, commercial document without charging any tax on the same, scenario is the ITC availed on the return supply and notithe ITC that is attributable to the manufacture of such time expired goods. ¥, _Mustration: Supposedly, manufacturer has availed ITC of Rs. 10/- at the time of manufacture 0 valued at Rs. 100/-, At the time of return of such medicine on the account of exp available to the manufacturer on the basis of fresh invoice issued by ‘So, when the time expired goods are destroyed by the manufacturer he verse ITC of Rs. 15/- and not of Rs, 10/-.
34 of the DGST Act the supplier can issue a credit note by the recipient. Thus, the manufacturer or the wholesaler olesaler or retailer, as the case may be, has the option to expired goods returned by the wholesaler or retailer, the retailer or wholesaler may return the time expired may be noted that there is no time limit for the pt with regard to the adjustment of the tax liability in the month of September following the end of the = eS Chat thi ' not availed the ITC © Person returnin, if availed has g the time expired goods has either me Feversed th retumed. © ITC $0 availed against the goods being expired goods are returned beyond the time period specified in the sub-section (2) of section 34 of the DGST Act and a credit note is issued cons: : equently, there is no requirement to declare such credit note on the common portal by the i supplier (i,e, by the person who has issued the credit note) as tax liability cannot be adjusted in this case, d) Further, where the time expired goods, retailer/wholesaler, are destroyed by the manufacturer, attributable to the manufacture of such goods, Which have been retumed by the he/she is required to reverse the ITC in terms of the provisions of clause (h) of subsection (5) of section 17 of the DGST Act, This has been ilftstrated in table below:
upply | Date ofreturn | Treatment in terms of tax liability & credit d of time expired note goods from retailer / Gredit note will be issued by the supplier (manufacturer / wholesaler) and the same to be uploaded by him on the common portal.
Subsequently, tax liability can be adjusted by such supplier provided the recipient | (wholesaler / retailer) has either not availed | the ITC or if availed has reversed the ITC, | 20° tat tober, | Credit note will be issued by the supplier 2018 (manufacturer / wholesaler) but there is no | requirement jo upload the same on the common portal, Subsequently tax liability | annot be adjusted by such supplier.
3, It may be noted that though this circular discusses the scx : narios in relation to retum of goods on account of expiry of the same, : it may be applicable fo such other scenarios where the goods are returned on account of reasons other than the one detailed above, 4 Difficulty, if any, in the implementation of this circular should Branch, Trade & Taxes Department, Govt. of NCT of Delhi, rought to the Policy a tieuecsecell Commissioner, GST(State Tax) Dated; 2-}\-) >
(201)//Policy-GST/2018/ So -65 for information and necessary action to:
joint Commissioners, Department of Trade and Taxes, GNCT of Bhawan |,P.Estate, New Delhi-02.
Department of Trade and Taxes, GNCT of Delhi, Vyapar New Deihi-02 for uploading the circular on the website of the | Secretary, Sales Tax Bar Association (Regd.), Vyapar Delhi.
GSTOs, Department of Trade and Taxes, GNCT of state, New Delhi-02.
ST(State Tax), Department of Trade and Taxes, GNCT "Estate, New Delhi-02.
n' ({ Sadanan Sah) Assistant Commissioner (Policy) GOVERNMENT oF Naty DEPARTMENT Pil ND TORY OF DELHI POLICY (GsT) Bauer VYAPAR BHAVAN AN:LP.ESTATE: :NEW DELHI-02 i EN0.3(60)Policy-Gsr017, | 34 _ Yo Dated: 3e/01/2018 Circular No, 09/2018-GST Central Circular No. 0H2018-GST) 30)04J2018 (Ref;
Subject: Clarification on supplies made to the In dian Railways classifiable under any ter, other than Chapter 86 — regarding, Representations have been received that certain suppliers are making supplies to the tems classifiable under any chapter other than chapter 86, charging the GST rate Pe.
Commissioner (GST) No. 3(66)/Policy-GST/2017/ \M34-Ue Dated: Boi1/ 2018 opy forwarded for information and necessary a ;
‘Copy 1) All Spl/Addl.Joint Commissioners, Denar Of Trade and Taxes, GNCT of Delhi, Vyapar Bhawan, LP-Estate, New Delhi-02, ;
2) Special Commissioner (PR), Department of Trade and Taxes, GNCT of Delhi, Vyapar Bhawan, LP.Estate, New Delhi-02 for wide publicity of the contents of this circular. 3) — Joint Director (IT), Department of Trade and Taxes, GNCT of Delhi, Vyapar Bhawan, 1.P. Estate, New Delhi-02 for uploading the circular on the website of the Department.
4) The President/General Secretary, Sales Tax Bar Association (Regd.), Vyapar Bhawan, LP, Estate, New Delhi. All Assistant Commissioners/GSTOs, Department of Trade and Taxes, GNCT of Delhi, Vyapar Bhawan, I.P. Estate, New Delhi-02.
PS to the Commissioner, GST, Department of Trade and Taxes, GNCT of Vyapar Bhawan, 1-P, Estate, New Delhi-02.
Jaf o1/re/3 (Sadqnand eile Assistant Commissioner (Policy)-V.
eel