Gujarat Authority of Advance Ruling (AAR) held that Petronet’s activity of re-gasification of LNG owned via its enrolled GST customers amounts to providing service by Job Work and 12% GST payable.
The petitioner is the owner of Petronet LNG ltd furnished that the same gives re-gasification services to its clients on the LNG owned through its customers, referred to as ‘Tolling’. In the ‘Tolling Model’, the Applicant obtains the LNG which belongs to the customers at its plant, stores it, regasifies it, and then furnishes RLNG to the customers. The petitioner enters into Re-gasification Agreements (RAs) with their clients.
The petitioner seeks the advance ruling upon the problem that if the petitioner’s implementation of furnishing the service of regasification of LNG owned through its clients to transform it to RLNG via its plant located in Dahej, Gujarat would amount to the rendering of service by way of Job Work within the meaning of Section 2(68) of the CGST, 2017 and the GGST Act, 2017 If yes then if the mentioned service of re-gasification via job work shall be counted beneath entry (id) of Heading No. 9988 at Sl. No. 26 of Notification No. 11/2017-CT (rate) dated 28.06.2017, as revised vide Notification No. 20/2019-CT (Rate) dated 30-09-2019 w.e.f. 01.12.2019 and be chargeable to CGST at the rate of 6%.
Read Also: Next Target to Convey Natural Gas Under GST Ambit
The bench consists of Sanjay Saxena and Arun Richard ruled that the Petronet’s activity of the regasification of LNG owned through its enrolled GST customers amounts to provide the service through the method of the Job work and advantages shall come beneath the entry ‘id’ of Heading 9988 at Sl. No. 26 of Notification No. 11/2017-CT (rate) on 28.06.2017, as revised subjected to CGST at 6%.
