Gujarat Authority for Advance Ruling Rejects Kandla Port Trust GST Query
- Ruling
- GUJ/GAAR/ADM/2018/30 dated 30.07.2018
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
In short
The Kandla Port Trust asked the Gujarat Authority for Advance Ruling (AAR) if it must pay Goods and Services Tax (GST) on disputed lease amounts and how to claim a refund later. The authority refused to answer these questions because they fall outside the specific legal topics it is allowed to decide.
What has changed
How it worked before
Businesses often assumed that the AAR could provide guidance on any tax-related uncertainty, including procedural questions about refunds or ongoing litigation. Many entities believed that if they were unsure about a tax liability arising from a legal dispute, the authority would offer a definitive path forward.
What has changed
The authority clarified that it only has the power to rule on specific issues like tax classification, valuation, and the determination of tax liability under Section 97(2) of the GST Act. This means that if your question is about general litigation strategy or the mechanics of claiming a refund, the AAR will reject your application without looking at the merits of your case.
Who this affects
This ruling is relevant for any business owner or entity involved in long-term commercial disputes, such as lease disagreements or contract litigation, where tax payments are being contested.
What you should do
You should not assume that an Advance Ruling can resolve your specific procedural or refund-related disputes, as the authority has strictly limited jurisdiction. Remember that an AAR decision is only binding on the specific business that asked the question and its own tax officer, so it does not automatically apply to your business or change the law for everyone else.
The ruling in detail
Authority for Advance Ruling
Kandla Port Trust (Deendayal Port Trust)
GUJ/GAAR/ADM/2018/30 dated 30.07.2018 · Gujarat
Questions before the authority
- Whether DPT shall continue to pay GST on disputed claim?
- How is it possible for DPT to claim refund for GST paid out of pocket, if the matter / dispute concluded in favour of party / lease holder, considering the fact that it may conclude after period of 2 or more years?
Facts
The applicant, a major port trust, revised its land lease rates as per the directions of the Tariff Authority of Major Ports. Several lessees challenged these revised rates, leading to ongoing litigation and non-payment of the disputed lease rent and associated GST by the lessees. The applicant has been paying the GST on these disputed amounts out of its own pocket and sought guidance on its continued liability and the mechanism for claiming refunds if the disputes are eventually decided against it.
Ruling
| Question | What the authority ruled |
|---|---|
| Liability to pay GST on disputed claims and refund mechanism | Rejected The Authority lacked jurisdiction to decide these issues under Section 97(2). |
The Authority rejected the application at the admission stage without addressing the merits of the questions. It held that the issues raised do not fall within the scope of matters that can be decided under the Advance Ruling mechanism.
Reasoning
The Authority examined its jurisdiction under Section 97(2) of the CGST and GGST Acts, which limits its power to specific issues such as classification, valuation, and tax liability. It concluded that the questions regarding the obligation to pay tax on disputed claims and the procedure for claiming refunds for such payments do not fall under any of the categories enumerated in Section 97(2). Consequently, the Authority determined it was **lacking jurisdiction** to entertain the application and rejected it under Section 98(2) of the Acts.
Provisions relied on
- Section 96 of the Gujarat Goods and Services Tax Act, 2017
- Section 97(2) of the CGST Act, 2017
- Section 97(2) of the GGST Act, 2017
- Section 98(2) of the CGST Act, 2017
- Section 98(2) of the GGST Act, 2017
For the practitioner
This ruling serves as a reminder that the Advance Ruling Authority is a creature of statute with **strictly limited jurisdiction**. It does not provide a forum for resolving general commercial disputes, litigation strategy, or procedural refund queries that fall outside the specific list of issues defined in Section 97(2). Practitioners should avoid approaching the AAR for guidance on tax administration or refund mechanics arising from ongoing civil or commercial litigation.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/guj.30-2018-19_dt_30.07.18_kpt.pdf
Legibility of the scan, as read: high.
Prepared 21-10-2026.
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