9911796707
TMI Blog2020 (4) TMI 868X X X X Extracts X X X X X X X X Extracts X X X X ..... hese supplies, i.e. supply of power pack and supply of freight and insurance are distinct supplies, the same would be covered under the definition of composite supply as per section 2(30) of the CGST Act, 2017, as the same are naturally bundled and supplied in conjunction with each other in the ordinary course of business - The principal supply in the case is the supply of power packs. Thus, the supply of power packs and the supply of freight and insurance services involved in such power packs shall be treated as the supply of power packs and the applicable tax related to such power packs and the time of supply would apply to the entire transaction as it applies to the supply of power packs . - KAR ADRG 21/2020 - - - Dated:- 23-4-2020 - DR. M.P. RAVI PRASAD AND SRI. MASHHOOD UR REHMAN FAROOQUI, MEMBER Represented by: Sri. K.S. Kamalakara, Cost Accountant ORDER UNDER SUB-SECTION (4) OF SECTION 98 OF CENTRAL GOODS AND SERVICES TAX ACT, 2017 AND UNDER SUB-SECTION (4) OF SECTION 98 OF KARNATAKA GOODS AND SERVICES TAX ACT, 2017 1. M/s. SAN Engineering Locomotive Company Limited, Whitefield Road, Bengaluru 560048, (hereinafter referred to the applicant ) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that as per Part-I of the said Purchase Order, the break-up of the price of each Power Pack, packing charges, freight charges, installation/ commission charges and duties/ taxes is as follows: Details Price (Rs.) Basic value for supply of each Power Packs ₹ 5,13,62,000-00 Packing Charges ₹ 7,70,000-00 extra Duties / Taxes As applicable Freight Charges ₹ 2,91,000-00 extra Other Charges Commissioning/charges ₹ 40,00,000-00 extra Insurance Charges ₹ 2,04,000-00 extra d. Since the value for the supply of goods and supply of services are separately provided in the Purchase Orders and the same not being naturally bundled and not supplied in conjunction with each other in the ordinary course of business, the applicant does not treat the supply of the same as Composite Supply . e. The applicant st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tory, Chennai either by themselves or they can avail installation and commissioning service from any other supplier of service. The supply of Power Packs and the installation of the same in HS SPART are not in conjunction with each other in the ordinary course or business. e. The applicant states that as per the said purchase orders, the receipt of power packs at the premises of M/S Integral Coach Factory, Chennai and by inspection of the same, the supply of Power Pack ends. As the supply of commissioning / installation takes place only on receipt of the power packs at the premises of M/S Integral Coach Factory, Chennai and ends with certificate issued by the officer concerned after successful installation and commissioning, hence the supply of power pack and installation and commissioning cannot be considered as composite supply . The applicant reproduces the relevant provisions of section 2(30) and 8 of the CGST Act, 2017. f. The applicant states that it is clear from the provisions of section 2(30) and 8 of the CGST Act, that where there is a supply by the registered person to recipient, which consists of two or more taxable supplies of goods or services or both, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld attract IGST 12% as per SI. No. 205G of schedule-Il to the Notification No.1/2017-IT (Rate) dated 28.06.2017 as amended read with section 8(a) of CGST Act, 2017, and b. the supply of installation and commissioning of power packs should be treated as independent supply of service classifiable under SAC 9954. The same should attract IGST @ 18% in terms of SI. No. 3 of Notification 08/2017 Integrated Tax (Rate) dated 28 June 2017 as amended. PERSONAL HEARING / PROCEEDINGS HELD ON 20.02.2020 7. Sri K.S.Kamalakara, Cost Accountant and duly authorised representative of the above concern appeared for personal hearing proceedings on 20.02.2020 before this authority and reiterated the facts already submitted above. FINDINGS DISCUSSION 8. We have considered the submissions made by the Applicant in their application for advance ruling as well as the submissions made by him when he appeared for the personal hearing. We have also considered the issues involved, on which advance ruling is sought by the applicant, and relevant facts. 8.1 At the outset, we would like to state that the provisions of both the CGST Act and the KGST Act are the same except for cert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices. Hence the applicant has to transport the goods and deliver the power packs to the recipient and the amount charged to do this is a part of the value of the goods supplied. Hence the freight and insurance charges are part of the value of supply of power packs, since the supply contract is a contract for supply of power packs and the value of the contract is the sum total of the value of the power pack plus all charges charged to the recipient for anything done till the goods are delivered to the recipient. 9.2 Even if these supplies, i.e. supply of power pack and supply of freight and insurance are distinct supplies, the same would be covered under the definition of composite supply as per section 2(30) of the CGST Act, 2017, as the same are naturally bundled and supplied in conjunction with each other in the ordinary course of business. The principal supply in the case is the supply of power packs. Further section 8 of the CGST Act, 2017 clearly states that the tax liability on a composite supply shall be determined by treating them as a supply of such principal supply. Hence going by this also, the composite supply of power pack and the supply of freight and insurance w ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
