Autobahn Trucking Corporation Private Limited V. The Union of India and The Central Board of Indirect Taxes and Customs and The Commissioner of Income Tax

WP(C)/4754/2019

AI Insights

The case revolves around the question of whether the amounts of Tax Collected at Source (TCS) under the Income Tax Act, 1961, should be included in the taxable value of supply under the Goods and Services Tax (GST) regime for motor vehicle sales. The petitioner, Autobahn Trucking Corporation Private Limited, argued that TCS should not be included in the GST calculation. The court referenced Circular No.76/50/2018-GST, which clarified that TCS should not be included in the taxable value for GST purposes. Consequently, the court found that the issue was resolved by the circular and closed the writ petition.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 813693 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 14-10-2022
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961, CGST Act, SGST Act, UTGST Act, GST (Compensation to States) Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH; RAJESH; P G JAYASHANKAR; C S MANU
• Assessee Lawyers: S ANIL KUMAR; M RAJAGOPAL
• Keywords: CGST; GST; Income Tax Act; Motor vehicles; Taxable Value; TCS
• Section: 15(2)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 14TH DAY OF OCTOBER 2022 / 22ND ASWINA, 1944 WP(C) NO. 4754 OF 2019 PETITIONER/S: AUTOBAHN TRUCKING CORPORATION PRIVATE LIMITED, XIX/9E, NIPPON TOWERS, HMT JUNCTION, KALAMASSERY, ERNAKULAM DISTRICT-683104, REPRESENTED BY ITS MANAGING DIRECTOR MOHAMMED FARZAD KALAYAM KULATH. BY ADVS. S.ANIL KUMAR (TRIVANDRUM) M.RAJAGOPAL RESPONDENT/S: 1 THE UNION OF INDIA, REPRESENTED BY THE SECRETARY TO GOVERNMENT, DEPARTMENT OF REVENUE, NORTH BLOCK, NEW DELHI-110001. 2 THE CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI-110001, REPRESENTED BY THE COMMISSIONER (GST), 3 THE COMMISSIONER OF INCOME TAX, C.R.BUILDINGS, I.S.PRESS ROAD, KOCHI-682018. BY ADVS. SRI.JOSE JOSEPH, SC, FOR INCOME TAX SRI.RAJESH B., SC, CENTRAL BOARD OF EXCISE & CUSTOMS SRI.P.G.JAYASHANKAR SRI. C.S.MANU, DSGI THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 14.10.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 4754 OF 2019 2 JUDGMENT This writ petition raises the question as to whether the amounts of TCS collected under the provisions of the Income Tax Act, 1961 can form part of the taxable value of supply under the GST regime during the course of sale of motor vehicles. It is the contention of the petitioner that the amount of TCS collected under the provisions of the Income Tax Act cannot from part of the taxable value for the purpose of collection of GST. 2. When this matter is taken up for consideration today, it is not disputed before me that the issue has now been clarified by issuance of Circular No.76/50/2018-GST- Central Tax as corrected by corrigendum No.76/50/2018- GST (F.No. 20/16/04/2018-GST), dated 07.03.2019 which clarifies that the amounts of TCS collected under the provisions of the Income Tax Act will not form part of the taxable value for the purpose of determination of the amount of GST to be paid on the sale of motor vehicles. 3. The circular dated 31.12.2018 as corrected by corrigendum No. 76/50/2018-GST (F.No. 20/16/04/2018- GST), to the extent it is relevant reads as follows: WP(C) NO. 4754 OF 2019 3 5. What is the correct valuation methodology for ascertainment of GST on Tax collected at source (TCS) under the provisions of the Income Tax Act, 1961? 1. Section 15(2) of CGST Act specifies that the value of supply shall include “any taxes, duties cesses, fees and charges levied under any law for the time being in force other than this Act, the SGST Act, the UTGST Act and the GST (Compensation to States) Act, if charges separately by the supplier.” 2. For the purpose of determination of value of supply under GST, Tax collected at source (TCS) under the provisions of the Income Tax Act, 1961 would not be includible as it is an interim levy not having the character of tax. In the light of the above, I am of the opinion that the issue raised in this writ petition no longer arises for adjudication. The writ petition is closed, making it clear that the issue will stand governed by the Circular dated 31.12.2018 [76/50/2018-GST-Central Tax] as corrected by corrigendum issued on 07.03.2019 [corrigendum No.76/50/2018-GST (F.No. 20/16/04/2018-GST)]. sd/- GOPINATH P. JUDGE ajt WP(C) NO. 4754 OF 2019 4 APPENDIX OF WP(C) 4754/2019 PETITIONER EXHIBITS EXHIBIT P1 COPY OF CIRCULAR NO.76/50/2018 GST DATED 31.12.2018 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P2 COPY OF ORDER DATED 17.01.2019 OF THIS HON'BLE COURT IN W.P.(C) NO.680 OF 2019. "