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Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

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GST Update on Declared Tariff- Hotel Industry

GST Update on Declared Tariff- Hotel Industry
GST Update on Declared Tariff- Hotel Industry

Notification No. 13/2018-Central Tax (Rate) dated 26th July, 2018 has been issued making amendments to Notification No. 11/2017 – Central Tax (Rate). These amendments shall come into effect from 27th July, 2018. One of the amendments in this notification is reproduced as following, “in items (ii), (vi) and (viii),- (A)for the words “declared tariff” wherever they occur, the words “value of supply” shall be substituted; (B) the Explanation shall be omitted;” Earlier the GST rate on accommodation services provided by hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes depended on the Declared Tariff. This implies that the declared tariff shown at the reception or website was taken and rate of tax was decided on the same. It has nothing to do with the actual tariff charged from the client.
This can be understood with the help of an example. Suppose, the room declared tariff displayed by hotel is Rs. 8000/- per day. Hence, the GST @ 28% is charged on the same room as the declared tariff is above Rs. 7500/-. But now the price is negotiated and actual amount charged from the client is Rs. 6500/-. Although it is below Rs. 7500 but the rate of 28% will be charged from the client. However, it will be charged on Rs. 6500/- only. Hence, it has complicated the position i.e. rate will be decided on the basis of “declared tariff” but the tax will be charged on actual amount charged from the client. 

But by way of aforesaid notification, the term “declared tariff” has been substituted by the term “Value of Supply” which means that the GST rate will be decided on the basis of actual amount charged from the client as well as GST amount is also calculated on this value only. Take the example above. The rate of tax will be decided on the value of supply i.e. Rs. 6500/-. Hence, the rate will be 18% as it is between Rs. 2500/- to Rs. 7500/-. The GST will be calculated on Rs. 6500/- @ 18 % only. This implied that there is no relevance of “declared tariff” now onwards. We should not reach at conclusion so fast. No change has been made in respect to the rate applicable on the restaurants. This shall be dependent on the declared tariff itself. If the declared tariff is above Rs. 7500/- then the rate of tax for restaurants will be 18% but if the declared tariff is below Rs. 7500/- then 5% will be charged.
Say in above example, Hotel has restaurant also. The person staying in that room where he is paying GST @ 18% on 6500/- room but the declared tariff is Rs. 8000/-. As declared tariff is more than Rs. 7500/- then the person eating in restaurant will be paying tax @ 18% on bill of restaurant. Hence, the concept of “declared tariff” has not lost his complete relevance. It is still relevant on decision of rate of restaurant in a hotel. Hotel cannot publish the tariff at its will. It is still relevant for decidinga rate of tax. Think before declaring high tariff at reception or website…..

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