Latest GST Judgments

For Full Access To All Latest Judgments on GST
Click Here To Subscribe Now
Take a tour of our GST Library

As long as such supply remains as a 'zero-rated supply' the demand for payment of 18% IGST cannot be sustained.

Place of supply- In the instant case, Issue involved is as to whether the respondent is liable to pay 18% tax under the Integrated Goods and Services Tax Act, 2017 with respect to the goods of Sandal Wood purchased by them in the auction conducted at the Forest Depot, they being units situated in the Special Economic Zone (SEZ) in the State of Tamil Nadu. When it is provided under the statute as to what determines the nature of 'inter-State supply' and 'intra-State supply', no one can go beyond provisions of the said Acts in order to decide the nature of the supply. From the conclusions arrived at as above, it need to be held clearly that, going by provisions of the IGST Act the supply to a SEZ unit can only be considered as inter-State supply. As long as such supply remains as a 'zero-rated supply' the demand for payment of 18% IGST cannot be sustained. Held that- When the rate applicable to such supply is determined as 'zero-rate supply', the demand for any higher rate cannot be sustained. It is pertinent to note that, neither under Section 7(5)(b) or under the proviso (i) of Section 8(1); nor under Section 16(1)(b) there is no distinction with respect to the location of the SEZ unit, whether it is within the State or outside the State. Therefore the above argument cannot be countenanced, at any rate.