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2019 (7) TMI 1333 - AAR - GSTClassification of services - activity of merely printing or reproducing the content given by the photographers / retail customers on pen drive, CD, memory card or any other storage media - whether classifiable under Service Code 998912 or 998386? HELD THAT - The Applicant is merely printing or reproducing the content given by the photographers or retail customers on a recorded media like pen drive, CD, Memory card or other storage area, etc. The editing or processing is done by the professionals or retail customers themselves. The Applicant merely does colour printing of images from film or digital media and supplies colour prints to the customers. The CBIC Circular No. 84/03/2019 GST dated 01.01.2019 issued under F.No. 354/428/2018-TRU very clearly states that such colour printing of images from film or digital media of 998386 are exclusively excluded from the service code 998912 i.e. Printing and reproduction services of recorded media, on a fee or contract basis . Applying the provisions of the CBIC Circular No. 84/03/2019 GST dated 01.01.2019 issued under F.No. 354/428/2018-TRU to the subject case at hand, it is found that the applicant is supplying services falling under SAC 998386 and the subject transaction is therefore covered under Entry 21 of Notification No. 11/2017- C. Tax (Rate) dated 28.06.2018 and attracts GST @ 18%. The activity of merely printing or reproducing the content given by the photographers / retail customers on pen drive, CD, memory card or any other storage media will be classifiable under Service Code 998386 and liable to tax @ 18%.
Issues Involved:
1. Classification of the printing activity under Service Code 998912 or 998386. 2. Applicable GST rate for the printing services provided by the applicant. Detailed Analysis: 1. Classification of the Printing Activity: The primary issue was whether the activity of merely printing or reproducing content provided by photographers or retail customers on a storage media (like pen drive, CD, memory card) should be classified under Service Code 998912 or 998386. - Applicant's Argument: - The applicant argued that their activity falls under SAC 998912, which covers "Printing and reproduction services of recorded media, on a fee or contract basis." - They contended that they merely print the content provided by customers without engaging in any photographic or videographic processing, which should exclude them from SAC 998386. - They cited a previous ruling by the West Bengal Authority for Advance Ruling (AAR) in the case of Photo Products Company Ltd., which classified similar activities under SAC 998912. - Concerned Officer's Argument: - The officer referred to CBIC Circular No. 84/03/2019-GST dated 01.01.2019, which clarified that the service of "printing of pictures" falls under SAC 998386. - The officer highlighted that SAC 998912 explicitly excludes "colour printing of images from film or digital media," thus supporting the classification under SAC 998386. 2. Applicable GST Rate: The second issue was determining the applicable GST rate for the printing services provided by the applicant. - Applicant's Argument: - The applicant argued that if classified under SAC 998912, the applicable GST rate would be 12% as per Entry 27 of Notification No. 11/2017-C.T. (Rate) dated 28.06.2017. - They also argued that the CBIC Circular No. 84/03/2019-GST should not apply to their case as it pertains to services falling under SAC 998386, which involves photographic processing. - Concerned Officer's Argument: - The officer maintained that the services provided by the applicant should be classified under SAC 998386, which attracts a GST rate of 18% as per Entry 21 of Notification No. 11/2017-C.T. (Rate) dated 28.06.2017. Observations and Findings: - The Authority for Advance Ruling (AAR) examined the facts, written submissions, and relevant provisions. - The AAR referred to the CBIC Circular No. 84/03/2019-GST, which explicitly states that "colour printing of images from film or digital media" falls under SAC 998386 and is excluded from SAC 998912. - The AAR noted that the applicant's activity of merely printing content provided by customers aligns with the description under SAC 998386. - The AAR also acknowledged the applicant's reference to the West Bengal AAR ruling but clarified that the CBIC Circular issued after the West Bengal ruling takes precedence and provides clear guidance on the classification. Conclusion: - The AAR concluded that the activity of merely printing or reproducing content given by photographers or retail customers on storage media falls under Service Code 998386. - Consequently, the applicable GST rate for such services is 18% (9% CGST and 9% MGST). Order: - The question was answered by classifying the activity under Service Code 998386 and confirming the applicable tax rate at 18%.
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