Actually this appellate order was given in the case of Ion Trading, a Noida-based private company, which is a UK subsidiary.
The UP Bench of the AAAR (Appellate Authority of Advance Rulings) has held that the amount recovered from the employees for the car parking fees, which is paid to the building authorities, is supplied by the employer company to the ‘supply of service’ (supply) for its employees. of service).
The Goods and Services Tax (GST) is triggered whenever there is such a supply. However, the services that were presented as ‘pure agents’ will have zero value. Actually this appellate order was given in the case of Ion Trading, a private company based in Noida, which is a UK subsidiary. The company submitted that parking space facilities between its employees and building authorities will not supply services as this activity is not a part of software development to further its business.
AAAR did not agree with this stance but it was agreed that the company was not using the parking fees recovered from the employees for its own benefit and the entire amount was given to the building authority. Therefore, it is like a pure agent and the value of the services offered by it will be zero. In other words, no GST amount will be taken from the employees.
As a result of the epidemic, a large number of employees (who do not work from home) use their personal vehicles, this order allows the employer to provide parking space. In this context, this order of UP sale of AAAR is correct.
The CA firm’s founder said, “This decision is contrary to an advance ruling in the case of Posco India, where the expenditure of health insurance for the parents of the employees was not kept to supply the service.” He went on to say, “However, as AAAR has admitted in this case, the deposit of parking fees was done in the capacity of a pure agent.” It should be noted that advance ruling only has a strong impact during the assessment of similar cases and does not set judicial precedents.
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