The Karnataka High Court bench of Justice S. Sujatha and Justice Shivashankar Amarannavar, while upholding the ruling of the Authority of Advance Ruling (AAR), held that 18% GST is payable on 'pattadar pass book cum title deed'.
The petitioner/assessee was engaged in the business of printing books, magazines, calendars, diaries, bank passbooks, bank account opening forms, and various other stationery items required for the banking industry, educational institutions, and various other customers. Telangana State Technology Services Limited, on behalf of the Chief Commissioner Land Administration (CCLA), invited bids for the secure printing and delivery of Pattadar Pass Book and Title Deed to all pattadars and land owners.The petitioner participated in the said tender process and, being the successful bidder, was awarded the contract.
The petitioner arranged for the material required for the printing and supply of the Pattadar Pass Book cum Title Deed as per the agreement entered into with CCLA. The petitioner procured paper and also printed the Pattadar Pass Book cumTitle Deed as per the prescribed security features and specifications.
The data/content for printing was provided to the petitioner in electronic format by CCLA. The Pattadar Pass Book cum Title Deed is a document of title since it provides ownership details and will serve as a document of title from a legal perspective.
The petitioner supplied a printed Pattadar Pass Book cum Title Deed charging 12% IGST for SAC 9989. The petitioner filed an application for an advance ruling in GST ARA-01 under Section 97 of the CGST Act.
The petitioner sought an advance ruling on the issue of whether the "Pattadar Pass Book cum Title Deeds" printed by the petitioner for supplies made to the Government of Telengana are classifiable as `Document of Title' under HSN 4907 or as "passbook" under HSN 4820".
The AAR ruled that the Pattadar Pass Book cum Title Deed is not a document of title and accordingly classifiable under HSN 4820, attracting Goods and Service Tax at 18% instead of the 12% as paid by the petitioner.
The AAR observed that the document of title is the document registered with the authority under the Registrations Act, 1908, and the passbooks are mere reflections of the same. The pattadar passbook is not a document of title as the record of rights in the office of the Mandal Revenue Officer is the actual record of title and ownership of land. The passbook enables the passbook holder to avail several government schemes without having to resort to obtaining certificates from the Revenue Officer at frequent intervals. The passbook and the title deed in the hand of the owner are not the ultimate document of title.
The petitioner, while challenging the ruling, contended that the Pattadar Pass Book cum Title Deed was not covered under specific entries and hence its classification under Tariff Entry 4907 00 90 was appropriate. The Pattadar Pass Book cum Title Deed was ultimately used by a Pattadar in relation to agricultural land. Therefore, the classification of a passbook as a document of title or otherwise has to be understood in the context of various land disputes. The Pattadar Pass Book Cum Title Deed confers ownership entitlement to certain financial interests or benefits named in the deed. As per the details in the scope of work of the tender document, it is clear that Pattadar Pass Book cum Title Deed is a document in the form of a small bound book containing the details of land owned by a person (pattadar).
The petitioner contended that the Appellate Authority for Advance Ruling had failed to consider the provisions of the Telengala Rights in Land and Pattadar Passbooks Act, 1971, with its allied Rules. The AAR has resorted to selective reading of provisions to conclude the classification of such Pattadar Pass Book cum Title Deeds under HSN 4820.
The department contended that the Pattadar Pass Book cum Title Deed is not a document of title, and it is only a revenue record, and the entries made in the revenue records cannot form the basis for a declaration of title. The Authority for Advance Ruling and the Appellate Authority for Advance Ruling have rightly classified the Pattadar Pass Book cum Title Deed under Chapter Head 4820.
The court noted that the Pattadar Pass Book cum Title Deed is a document in the form of a small bound book containing the details of land owned by a person (Pattadar), a photo identity of Pattadar, and changes of ownership subsequent to the issue of the Pattadar Pass Book cum Title Deed. This Pattadar Pass Book cum Title Deed is issued by the Revenue Department under the law called the Record of Rights Act.
The court held that the Pattadar Passbook cum Title Deed is not a document of title as claimed by the petitioner and is not classifiable under Chapter Heading 4907 of the Customs Tariff Act.
Case Title: M/s. Manipal Technologies Ltd. Versus State of Karnataka
Case No: WP No. 4866/2021
Citation: 2022 LiveLaw (Kar) 166
Counsel For Petitioner: Advocates Ravi Raghavan, Sudeshna Bannerjee
Counsel For Respondent: Advocate Jeevan J Neeralgi