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TMI Blog2020 (7) TMI 480X X X X Extracts X X X X X X X X Extracts X X X X ..... and under entry no. 26(ii) as Manufacturing services on physical inputs (goods) owned by other it is taxable @18%. - Case No. 25/2019, Order No. 09/2020 - - - Dated:- 2-6-2020 - MANOJ KUMAR CHOUBEY AND VIRENDRA KUMAR JAIN, MEMBER Present on behalf of applicant : CA. P D Nagar, Authorised Representative PROCEEDINGS (Under sub-section (4) of Section 98 of Central Goods and Service Tax Act, 2017 and the Madhya Pradesh Goods Service Tax Act, 2017) 1. The present application has been filed u/s 97 of the Central Goods Services Tax Act, 2017 and MP Goods Services Tax Act, 2017 (hereinafter also referred to CGST Act and SGST Act respectively) by M/s. V E Commercial Vehicles Limited (hereinafter referred to as the Applicant), registered under the Goods Services Tax. 2. The provisions of the CGST Act and MPGST Act are identical, except for certain provisions. Therefore, unless a specific mention of the dissimilar provision is made, a reference to the CGST Act would also mean a reference to the same provision under the MPGST Act. Further, henceforth, for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST or MP GST Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bus or provision of services in respect of activity of mounting/fabrication of bus body on the chassis wherein the said activity of mounting/fabrication is outsourced to the Applicant by owner/provider of chassis in following two scenarios:- 4.1 The chassis is originally manufactured by one of the unit of the applicant registered separately as distinct person under GST Act and sold to provider of chassis receiving the chassis for fabrication of body. 4.2 The chassis is originally manufactured by some other OEM and sold to provider of chassis before receiving the chassis for fabrication of body. 5. CONCERNED OFFICER'S VIEW POINT: The concerned officer is of the view that in both the cases for which the applicant has asked for advance ruling will be taxes by 18% (9% CGST and 9% CGST) under services falling under SAC 998881 - Motor vehicle and trailer manufacturing services and under entry no. 26(ii) as Manufacturing services on physical inputs (goods) owned by other . 6. RECORD OF PERSONAL HEARING: 6.1 CA. P D Nagar, Authorised Representative of the applicant for personal hearing the submissions already made in the application. The Applicant states th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assembly plant is sold to its dealer. The dealer is approaching applicant for fabrication of body. While sending the chassis to applicant, the customer owns the chassis and asks applicant to fabricate the Bus body on chassis owned by him. The chassis and body will continue to be owned by dealer who has provided the chassis for body fabrication after body fabrication. Apart from this the applicant will continue to receive the chassis from Vehicle manufacturing plant as being done currently and supply the complete Bus charging 28% GST. 6.1.3 Applicant understands that in the situations described in above Para, the chassis is owned by person desirous to get the body fabricated and applicant is not owner of chassis. The chassis owner has full liberty to go to any body builder for getting the body fabrication work carried out. The applicant is one of the choices for owner of chassis to get the body fabrication. 6.1.4 Applicant understands that such situations are covered under the Circular No. 52/26/2018-GST dated 9th August, 2018. The relevant para of circular is reproduced below. 12.1 Applicable GST rate for bus body building activity: Representations have been receiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance ruling, the ruling has been sought on the question that Whether the supply towards provision of services in respect of activity of mounting/ fabrication of bodies on chassis by the customer should be treated as supply of bus or provision of services in respect of activity of mounting/ fabrication of bus body on the chassis, wherein said activity of mounting / fabricating is outsourced to the applicant by the owner / provider of chassis - 6.2.1 The chassis is originally manufactured by one of the unit of the applicant registered separately as distinct person under GST Act and sold to provider of chassis before receiving the chassis for fabrication of body. 6.2.2 As mention in the question that the chassis is manufactured by one of the unit of the applicant registered separately as distinct person and as mandate by the Motor Vehicles Act, the Chassis is delivered to the customer by raising a separate invoice, paying road tax and after issuing the insurance policy in the name of customer. By this act, it may be concluded that the supply of chassis, by one of the unit of applicant, is complete once the chassis is handed over to the customer and on such hand over, the custome ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b) There is a judgement of Authority for Advance Ruling- Madhya Pradesh in the case of Arpijay Fabricators Pvt. Ltd 2018 33 GSTJ 211 = 2018 (8) TMI 284 - AUTHORITY FOR ADVANCE RULINGS, MADHYA PRADESH where it was held that if the predominant element to be the service part, then the principal supply would be classified under heading No 9988. (c) As per the process of body building, some goods are used by job worker Therefore it is composite supply consisting of small part of supply of goods and major part of supply of services. As per the provision of Sec. 8 (a) of CGST Act the same should be classified as supply of services under HSN-9988 which attracts Tax @ 18% GST. 7. DISCUSSIONS AND FINDINGS: 7.1 We have carefully considered the submissions made by the applicant in the application and during time of personal hearing. 7.2 Now we come to the question raised by the Applicant as Whether mounting of Bus/ Truck Body by the job worker on the chassis supplied by the principle for which the applicant charged fabrication charges including cost of certain material that was consumed during the process of job work would be classified as supply of service under HSN 9988 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable to the vehicle @28%. In the case as mentioned at Para 12.2(b) above, fabrication of body on chassis provided by the principal (not on account of body builder), the supply would merit classification as service, and 18% GST as applicable will be charged accordingly. 7.5 The submission by the applicant with the application and during time of argument clearly shows that the nature of the work for which ruling on the rate of Tax has been sought in the question clearly falls under Para 12.2(b) of the above mentioned circular fabrication of body on chassis provided by the principal (not on account of body builder), the supply would merit classification as service, and 18% GST as applicable will be charged accordingly. 8. RULING (Under section 98 of Central Goods and Services Tax Act, 2017 and the Madhya Pradesh Goods and Services Tax Act, 2017) 8.1 In respect of the question raised by the applicant we hold that the supply towards provision of services in respect of activity of mounting/ fabrication of bodies on chassis provided by Customer should be treated as supply of bus or provision of services in respect of activity of mounting/fabrication of bus body on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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