Based on the recommendations of the GST Council in its 48th meeting held on 17th December 2022, clarifications, with reference to GST levy, related to the following are being issued through Circular No. 189 & 190 :
Clarification regarding GST rates and classification of certain goods:
| Particular | HSN/Exemption Entry | GST RATE | COMPENSATION CESS |
| RAB | 1702 | 18% | |
| GST on by-products of milling of Dal/ Pulses such as Chilka, Khanda and Churi/Chuni | S. No. 102C f schedule of notification No. 2/2017- Central Tax (RATE) | Fully EXEMPT | |
| Carbonated Beverages of Fruit Drink’ or ‘Carbonated Beverages with Fruit Juice’ | 2202 99 | 28% | 12% |
| snack pellets (such as ‘fryums’) | 1905 90 30 | 18% | |
- The higher rate of compensation cess of 22% is applicable to motor vehicle fulfilling all four conditions, namely, it is popularly known as SUV, has engine capacity exceeding 1500 cc, length exceeding 4000 mm and a ground clearance of 170 mm or above.
Clarifications regarding applicability of GST on certain services:
Applicability of GST on accommodation services supplied by Air Force Mess to its personnel:
- All services supplied by Central Government, State Government, Union Territory or local authority to any person other than business entities (barring a few specified services such as services of postal department, transportation of goods and passengers etc.) are exempt from GST. (Sl. No. 6 of notification No. 12/2017 – Central Tax (Rate))
- Therefore, as recommended by the GST Council, it is hereby clarified that accommodation services provided by Air Force Mess and other similar messes, such as, Army mess, Navy mess, Paramilitary and Police forces mess to their personnel or any person other than a business entity are covered by Sl. No. 6 of notification No. 12/2017 – Central Tax (Rate) dated 28.06.2017 provided the services supplied by such messes qualify to be considered as services supplied by Central Government, State Government, Union Territory or local authority.
Applicability of GST on incentive paid by MeitY to acquiring banks under Incentive scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions:
- It is not a consideration paid by the central government for any service supplied by the acquiring bank to the Central Government. The incentive is in the nature of a subsidy directly linked to the price of the service and the same does not form part of the taxable value of the transaction in view of the provisions of section 2(31) and section 15 of the CGST Act, 2017.
- As recommended by the Council, it is hereby clarified that incentives paid by MeitY to acquiring banks under the Incentive scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions are in the nature of subsidy and thus not taxable.
Disclaimer: This Article is only a knowledge sharing initiative and is based on the Relevant Provisions as applicable and as per the information existing at the time of the preparation. In no event RMPS & Co. or the Author or any other persons be liable for any direct and indirect result from this Article or any inadvertent omission of the provisions, update etc if any.
