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TMI Blog2018 (5) TMI 964X X X X Extracts X X X X X X X X Extracts X X X X ..... on such freight bills? Held that: - It is immediately apparent that the First Contract cannot be executed independent of the Second Contract. There cannot be any ‘supply of goods’ without a place of supply. As the goods to be supplied under the First Contract involve movement and/or installation at the site, the place of supply shall be the location of the goods at the time when movement of the goods terminates for delivery to the recipient, or moved to the site for assembly or installation - Composite nature of the contract is clear from the clause that defines satisfactory performance of the First Contract (supply of goods) as the time when the goods so supplied are installed and finally commissioned in terms of the Second Contract - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commissioning of transmission lines etc (Second Contract), which also includes inland/local transportation, in-transit insurance, loading/unloading for delivery of materials and storage of them at the contractee s site. The contractee agrees to reimburse the actual GST payable, except on the price component for inland/local transportation, in-transit insurance and loading/unloading. The applicant raises separate freight bills on the contractee as per the rate schedule annexed to the Second Contract. 2. The Applicant wants a Ruling on whether he is liable to pay tax on such freight bills. An Advance Ruling is admissible on this question under Section 97 (2)(a) (e) of the CGST / WBGST Act, 2017 (hereinafter the GST Act ). The Applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 136-FT dated 28/06/2017 under State tax) (hereinafter the Exemption Notification ). 5. Serial no. 18 of the Exemption Notification exempts services by way of transportation of goods by road, except the services of a GTA. In his written submission the Applicant admits that he is not transporting the goods, but hiring the service of a transport agency. Similarly, the Applicant is not providing the insurance service, but buying such services from an insurance service provider. The Applicant is, therefore, the recipient of such services and not a supplier thereof. The question of the Applicant providing transportation service, therefore, does not arise. 6. Before deciding the issue of taxability of the consideration payable under the S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the goods terminates for delivery to the recipient, or moved to the site for assembly or installation [refer to Section 10(1) (a) (d) of the IGST Act, 2017]. The First Contract, however, does not include the provision and cost of such transportation and delivery. It, therefore, does not amount to a contract for supply of goods unless tied up with the Second Contract. In other words, the First Contract has no leg unless supported by the Second Contract. It is no contract at all unless tied up with the Second Contract. 10. The contractee is aware of such interdependence of the two contracts. Although awarded under two separate contract agreements, clauses under both of them make it abundantly clear that notwithstanding the br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of towers and testing and commissioning transmission lines and related services are not separate contracts, but form only parts of an indivisible composite works contract supply, as defined under Section 2(119) of the GST Act, with single source responsibility . 12. Composite nature of the contract is clear from the clause that defines satisfactory performance of the First Contract (supply of goods) as the time when the goods so supplied are installed and finally commissioned in terms of the Second Contract. In other words, the First Contract cannot be performed satisfactorily unless the goods have been transported and delivered to the contractee s site, applied for erection of towers, the transmission lines laid, tested and commi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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