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TMI Blog2018 (11) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... shaft and MS shaft for couplings used as a part of fishing /floating vessels would come under entry 252 of 1st schedule and taxable @5% GST. However there is no clarity on the tax rate applicable to the parts shipping vessels as the raw materials attract 18% tax. Classification of parts of fishing - Held that:- As there is specific inclusion of parts of goods covered under HSN 8902, under 15t Schedule, the general tax rate applicable to machinery parts vide HSN 8487 has no applicability, if the vessels are used for fishing purpose. Whether replacement of parts during warranty period constitute supply under GST or not? - Held that:- The replacement of parts during warranty period is a free supply. Warranty is a written guarantee, issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ND SHRI B.S. THYAGARAJABABU B.Sc., LLM, MEMBER Authorized Representative: Mr. K. Sivarajan, Mr. Srihari, Mr. Shubham Mishra Applicant is a manufacturer of Marine propellers, Rudder set, Stern tube set, Propellers shaft, MS shaft for couplings used in fishing or floating vessels. Applicant requested advance ruling on the following: i) The tax rate of Marine propellers, Rudder set, Stern tube set, Propellers shaft, MS shaft for couplings. ii) The parts of fishing (floating vessels come under the HSN Code 8902. They requested to know whether all parts of fishing (floating vessels comes under SI.No.252 of 1 st Schedule, or Sl.No.371 of 3rd Schedule? iii) Whether replacement of parts during warranty period constitute sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deration for the promise to repair or replace . Since the parts are provided to a customer without consideration under warranty no GST is chargeable on such replacement. The value of supply made earlier includes the charges to be incurred during the warranty period. Therefore, the supplier who has undertaken the warranty replacement is not required to reverse the input tax credit on the parts / components replaced. Even though the raw materials consumed are attracting higher tax rate than the finished products or parts, input tax paid is eligible to avail as input tax credit subject to a condition that such goods or services or both are used or intended to be used in the course or furtherance of his business. As per Section 54 (3) of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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