GST APPLICABILITY ON DUTY-FREE SUNGLASS SALES AT IGI AIRPORT: DELHI AAAR

GST APPLICABILITY ON DUTY-FREE SUNGLASS SALES AT IGI AIRPORT: DELHI AAAR

DELHI APPELLATE AUTHORITY FOR ADVANCE RULING
GOODS AND SERVICES TAX

Case Title: M/s Rod Retail Private Limited

(GST DAAAR Delhi)

Order No. 03/DAAAR/2022-23

Advance Ruling Challenged: 01/DAAR/2018 dated 27.03.2018

Date of Judgment/ Order: 23rd May 2022

IMPORTANT PARAGRAPHS

Para No. 1. At the outset we would like to make it clear that the provisions of CGST, Act 2017 and DGST, Act 2017 are pari materia and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the DGST Act.

Para No. 2. The present appeal has been filed under section 100 of the Central Goods and Service Tax Act 2017 and Delhi Goods and Service Tax Act 2017 (herein after referred to as CGST Act, 2017 and SGST Act, 2017) by M/s Rod Retail Private Limited, 204, Ground/F/F, Okhla Industrial Estate, Phase-III, New Delhi-110020 New Delhi (herein after referred to as Appellant) against the advance Ruling No. 01/DAAR/2018 dated 27.03.2018. The date of communication of Advance Ruling to the appellant was 10.04.2018.

BRIEF FACTS OF THE CASE

Para 3 – The applicant is in the business of retail sale of sunglasses. The applicant was registered under the Delhi Value Added Tax Act, 2004 and the Central Sales Tax Act, 1956 and now the applicant has migrated to GST regime and its present provisional GST Number is 07AADCR6468R1ZF. The applicant has several retail outlets in Delhi and one such outlet is at Terminal-3 (International Departure), Indira Gandhi International Airport, New Delhi. The present application relates to the question arising from the transaction conducted from the said outlet.

Para 3.1 –

Every International Airport has a “Landside” and an “Airside”. The Landside area comprises of Check-in counters and Baggage Drops and Airside area has aircrafts for boarding. A passenger crosses over from Landside to Airside by passing through Customs & Immigration area and then through security on to the Boarding Gate for departure. The applicant’s concerned retail outlet is in the Security Hold Area on crossing the Customs & Immigrations with the address – Shop No. INS-18, SHA Area, International Departure, Terminal-3, IGI Airport, New Delhi-110037. The said outlet is permitted to function beyond the Customs Area and within the Security Hold Area of the IGI Airport vide an arrangement with the Delhi International Airport Private Limited, dated 06.06.2016. The Concept and Category of the applicant under the said agreement being Retail and Sunglasses and the brand – “Sunglass Hut”, which is a retail brand of the International group Luxottica. For the purposes of sale from the said outlet, the applicant procures supplies from the Sunglass Hut brand owner M/s Luxottica India Private Limited, Gurgaon, after payment of integrated Tax (Inter-State Supply form Gurgaon to Delhi) @ 28%. The sunglasses procured from the supplier are further supplied by the applicant to the International passengers travelling to outside India against a valid international boarding pass. The applicant supplies goods only to such passengers which have a valid international boarding pass. In few instances, where domestic passengers are travelling to a domestic destination on a transit International flight, no supply to such passengers holding a domestic boarding pass is made by the applicant.

RULING-

13. Based on the elaborate finding of ours, we hold that based on the provisions of law, as extracted herein, we hold that transactions i.e. supply of goods to outbound International travellers fall within the definition of “taxable territory” and when read in conjunction with section 7 of the CGST Act, 2017 forms “supply” and attracts the applicable GST on the date of supply of the goods. We hold it accordingly.

14. In the light of the findings of ours read with the judgment Al Cuisines Private Limited(supra) relied upon by us, we are of the considered view that the Ruling challenged before us by way of an appeal is legally tenable in the eyes of law and no infirmity has crept in the findings and merits being upheld and we do so.