ORDER

Writ Petition (civil) praying inter alia that in the circumstances stated in the affidavit filed along with the WP(C) the High Court be pleased to stay the operation of Sl. No. 5 of the Clarifications issued vide Circular No. 76/50/2018-GST, dated 31-12-2018, pending disposal of this Writ Petition.

This petition coming on for admission upon perusing the petition and the affidavit filed in support of WP(C) and upon hearing the arguments of M/S SUKUMAR NAINAN OOMMEN, ASHA ESTHER OOMMEN, JONATHAN P PAUL, LAKSHMI SEETHARAMAN, RAHUL IPE PRASAD and SHERRY SAMUEL OOMMEN, Advocates for the petitioner, the court passed the following:

1. Section 15 of the Goods and Services Tax Act speaks of the value of goods and services, besides defining how the value of supply shall be reckoned. It says that the value of supply of goods, services, or both shall be the transaction value, which is “the price actually paid or payable for the said supply of goods or services or both where the supplier and the recipient of the supply.”

2. Section 15(2) mandates that the value of supply shall include any taxes, duties, cesses, fees and charges levied under any other law in force.

3. As has been rightly contended by the learned Senior Standing Counsel for the Customs Department, Section 15(2)(a) is expansive. Yet the learned Senior Counsel for the petitioner, has submitted that the amount of 1% the dealer collects from the purchaser of a car worth more than ten lakhs, under Section 206C(1F) of the Income Tax Act, cannot be treated as an integral part of the value of the goods and services supplied by the petitioner. According to him, the petitioner, as the dealer of the motor vehicle, acts only as an agent for the State to collect the income tax under Section 206C(1F). And that amount will eventually goes to the vehicle purchaser’s credit.

4. In this context, the learned Senior Counsel has drawn my attention to the last portion of Section 15(2)(a), which emphasises “charging of tax, duties, cess or fee by the supplier”.

5. Indeed, recently a constitution Bench of the Hon’ble Supreme Court in Commissioner of Customs (Import), Mumbai v. Dilip Kumar & Co. 69 GST 239 has held that any ambiguity in taxing provision should be resolved in the State’s fare. Yet, in this context, to conclude either way it needs further and deeper adjudication. Thus, the petitioner has raised a prima facie issue, which needs Court’s attention.

6. I, therefore, hold that the authority will not act on the clarification at Sl.No.5 of Ext.P1 pending the disposal of the writ petition. I, however, clarify that this arrangement shall be subject to the outcome of the writ petition and without prejudice to the rights of the Department in collecting the taxes in future if the writ outcome is adverse to the petitioner.