Introduction :
The most awaited GST is all about supply as it merger sale and service in the term supply. The learned author aims at enlightening readers about the concept and importance of supply.
Meaning and scope of supply
The law provides for the definition and scope of apply. In simple terms, supply includes all the following –
- All forms of supply of goods and/or services such as
- sale,
- transfer,
- barter,
- exchange,
- license,
- rental,
- lease or
- disposal made or agreed to be made for a consideration by a person in the course or furtherance of business
- Importation of service, whether or not for a consideration and whether or not in the course or furtherance of business,
- A supply specified in schedule I, made or agreed to be made without a consideration.
- Schedule I – All the following matters will be considered as supply without consideration
- Permanent transfer or disposal of business assets.
- Temporary application of business assets to a private or non-business use.
- Services put to a private non-business use.
- Assets retained after deregistration.
- Supply of goods and/or services by a taxable person to another taxable or non-taxable person in the course of furtherance of business.
However, the supply of goods by a registered taxable person to a job worker in terms of section 43A shall not be treated as supply of good
Supply as mentioned in Schedule II
Schedule II, in respect of matters mentioned therein, shall apply for determining what is, or is to be treated as a supply of goods or a supply of services.
- Transfer of the title in goods is a supply of goods.
- Transfer of goods or of right in goods or of undivided share in goods without the transfer of title thereof, is a supply of services.
- Transfer of title in goods under an agreement which stipulates that property in goods will pass at a future date upon payment of full consideration as agreed, is a supply of goods.
- Lease, tenancy, easement, license to occupy land is a supply of services.
- Lease or letting out of the building including a commercial, industrial or residential complex for business or commerce, either wholly or partly, is a supply of services.
- Treatment or process which is being applied to another person's goods is a supply of services.
- Transfer of business assets
- Goods forming part of the assets of a business when transferred or disposed of so as no longer to form part of those assets, whether or not for a consideration, such transfer or disposal is a supply of goods.
- Where, by or under the direction of a person carrying on a business, goods held or used for the purposes of the business are put to any private use or are used, or made available to any person for use, for any purpose other than a purpose of the business, whether or not for a consideration, the usage or making available of such goods is a supply of services.
- Where any goods, forming part of the business assets of a taxable person, are sold by any other person who has the power to do so to recover any debt owed by the taxable person, the goods shall be deemed to be supplied by the taxable person in the course or furtherance of his business.
- Where any person ceases to be a taxable person, any goods forming part of the assets of any business carried on by him shall be deemed to be supplied by him in the course or the furtherance of his business immediately before he ceases to be a taxable person, unless-
(a) the business is transferred as a going concern to another person; or
(b) the business is carried on by a personal representative who is deemed to be a taxable person.
- The following shall be treated as "supply of services"
- Renting of immovable property;
- Construction of a complex, building, civil structure or a part thereof, including a complex or building intended for a sale to a buyer, wholly or partly except where the entire consideration has been received after issuance of completion certificate, where required, by the competent authority or before its first occupation, whichever is earlier.
- Here, the expression "construction" includes additions, alterations, replacements or remodeling of any existing civil structure;
- Temporary transfer or permitting the use or enjoyment of any intellectual property right;
- Development, design, programming, customization, adaption, up gradation, enhancement, implementation of information technology software;
- Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act;
- Works contract including transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract;
- Transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; and
- Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration.
- The following shall be treated as supply of goods
- Supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration.
Agency related activity
Any person acting as an agent who, for an agreed commission or brokerage, either supplies or receives any good and/or services on any behalf of any principal, the transaction between such principal and agent shall be deemed to be a supply.
Power of Central Government
The central or a State Government may, upon recommendation of the council, specify, by notification, the transactions that are to be treated as-
(i) a supply of goods and not as a supply of services; or
(ii) a supply of services and not as a supply of goods; or
(iii) neither a supply of goods nor a supply of services.
Branded Supply
The supply of any branded service by an aggregator, as defined in section 43B, under a brand name or trade name owned by him shall be deemed to be supply of the said service by the said aggregator. Here, aggregator means a person, who owns and manages an electronic platform, and by means of the application and a communication device, enables a potential customer to connect with the persons providing service of a particular kinds under the brand name or trade name of the said aggregator.
Conclusion
Thus, GST act had covered almost all sorts of services as existingly defined and all sorts of manufacturing and trading activity in the ambit of supply considering different type and nature of transactions.
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