GST council asked the fast-food chain Subway for its franchisee chain in India, Punjab and Haryana high court to provide a final order held in favour of the fast-food chain that enables them to furnish the reply and make the submissions on law and advantages.
The concern came to knowledge when the GST council summoned Subway India urging to levy 18% GST on the income which the organization is performing through the franchise. Apart from that, Subway has furnished 12% GST on these services. After obtaining the summons, the fast-food chain has asked the Punjab and Haryana High Court to oppose them.
The organization in its appeal seeks to furnish that they ask for the transparency from GST advance ruling authority upon the applicability of the specific rate of GST towards these services and hence urged for specific time in answering the notices. The summons is furnished to the top management asking for the payment as clearance of the tax dues prior to the issuance of any show-cause notice or order.
Regarding the concern of the Subway, the issue is upon the taxability of the intellectual property rights towards the rate of either 12% or 18%. On the other side, Subway has furnished an application through the advance ruling authority and the application is left for disposal. GST heads provide several summons to Subway India asking for the company to furnish the information as well as the half recovery of tax excluding the providing of show cause notice.
Writ application furnished through the Subway India to Punjab and Haryana High court was an appeal with no imposition should be opted and that any recovery should be furnished only next to the passing of the specific order post to the left procedure of the law.
The court from Punjab and Haryana mentioned that a specific time should be given to present the case and thus the applicant was urged to furnish all the records, next to the council.
“Our submission is that the investigation cannot proceed when the advance ruling application is pending. Secondly, multiple summonses must not be issued to traumatise the petitioner and the petitioner must be given adequate breathing time to file submissions appropriately. Further, while the power to issue summons have been raised, the moot point remains that there must not be any recovery without following the process of law,” said tax expert.
“Investigation cannot be initiated when there is no case of tax evasion and that no recovery of demand can be done without the issuance of GST show cause notice and the speaking order,” Rastogi replied.
