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TMI Blog2018 (12) TMI 1867X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ruling) along with annexure and attachment. 4) The Applicant in his application sought following questions for determination by the Authority - i) Whether a contract can be treated as Composite Contract under GST if it involves making of supply of goods and services which are inter - connected and inter - dependent on each other even though BOQ mentions separate value of goods and services. ii) Whether a pre GST Period Contract can be treated as Composite Contract in GST even though there was separate Sale and Service Billing in Pre GST period iii) Whether contract for designing, installation and setting up of Automatic Fare Collection System for Lucknow Metro Project shall amount to a Composite Contract with Principal Supply being Supply of Service or Work Contract. iv) GST rate to be charged on LMRC Project i.e. Whether 18% or 12% to be charged after considering Rate Change Notification No. 1/2018- Integrated Tax (Rate) dated 25/01/2018 and all other provisions of GST Laws. 5) The application for advance ruling was forwarded to the Jurisdictional GST Officer to offer their comments/views/verification report. The comments of the Jurisdictional GST Officer were received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under: '(30) "composite supply" means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply; Illustration - Where goods are packed and transported with insurance, the supply of goods, packing materials, transport and insurance is a composite supply and supply of goods is a principal supply; Further, under 'mixed supply' is defined as (74) "mixed supply" means two or more individual supplies of goods or services, or any combination thereof made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply. Illustration- A supply of a package consisting of canned foods, sweets, chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be supplied separately and is not dependent on any other. It shall not be a mixed supply if these items are supplied separately; In view of the abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upply under the said contract shall be supply of service and accordingly tax will be leviable at the rate applicable for services on the total amount payable for setting up of Automatic Fare Collection System. Department's View The Authority has gone through the submission of the applicant and observed the following: Works Contract has been defined under the Central Goods and Services Act, 2017 (12 of 2017) as under: "(119) "works contract" means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract" In view of the above definition, it is clear that any contract meant for installation or maintenance of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract would fall under the category of 'Works Contract'. The applicant is of the view that the Automatic Fare Collection System involves instal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, the Automatic Fare Collection System though movable have been fixed permanently to the building i.e. LMRC station building and meant for permanent beneficial enjoyment of the immovable property i.e. LMRC station building as in absence of the said System, there will be requirement of another system to run the station efficiently. Further, it is also observed by the Hon'ble Supreme Court that the attachments should not have separate existence from the house. In the instant case, the Automatic Fare Collection System is an integral part of the LMRC station building and has no separate existence. In view of the above, the submission of the applicant that the Automatic Fare Collection System is not immovable property as the same is not attached to the earth for the permanent beneficial enjoyment of the immovable property, is not correct and therefore, we find that the Automatic Fare Collection System fulfills the conditions laid down while analyzing the definition of immovable property in the above decision of the Supreme Court. Further, the Authority for Advance Ruling under GST, Rajasthan vide its Ruling reported as 2018 (16) GSTL 623 (AAR-GST) has held that "Big project ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... monorail and metro; attracting the duty rate @ 12%. Later, vide Notification No. 1/2018-Integrated Tax (Rate) dated 25.01.2018 the notification No. 8/2017-Integrated Tax (Rate) was amended and the word `excluding' was substituted by 'including' also classifying that the Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Service Tax Act, 2017 provided by a sub-contractor to the main contractor providing services specified in item (iii) or item (vi) above to the Central Government, State Government, Union territory, a local authority, a Governmental Authority or a Government Entity would attract duty at the rate of 12%. Since, in the instant case, the composite supply of work contract is being provided by a sub-contractor to the main contractor i.e. Government Authority, the same shall be covered under the above amendment carried out vide the above notification dated 25.01.2018, the same shall now attract duty at the rate 12%. 10) In view of the above, both the members unanimously rule as under; RULING The point wise clarifications are as under:- i) A contract shall be treated as Composite Contract under GST if it in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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