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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 ..... te the principal service as clearly stipulated in the illustration of the 'composite supply', the services will fall under the category of 'Composite Supply'. 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? - HELD THAT:- If the goods and services works together in inter-connected and inter-dependent manner and fall under the category of 'Composite Supply', the Contract executed under Pre- GST period would be treated as Composite Contract in GST era as in the GST era both sale and supply of services both are covered under GST Laws. Accordingly, the Contract laid down under Pre GST era be covered under Composite Contract in GST era under GST Laws, if the conditions for 'Composite Supply' are satisfied. 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? - HELD THAT:- The end structure or machinery that cannot be located/ moved or shifted elsewhere at frequent intervals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Uttar Pradesh - Order- Reg. 1) M/s Datamatics Global Services Limited, H.No. 1/100, Vinay Khand, Gomti Nagar, Lucknow, Uttar Pradesh, 226010 (here in after called the applicant) is a registered assessee under GST having GSTN: 09AAACD4471B1Z0. 2) The Applicant is primarily engaged in the business of IT Solutions. They alongwith their Consortium Partner have been awarded the contract for Design, Manufacture, Supply, Installation, Testing and Commissioning of the Automatic Fare Collection System for Phase 1A of the Lucknow Metro Rail Project by the Lucknow Metro Railway Corporation LMRC'. 3) The Applicant has submitted application for Advance Ruling dated 20.09.2018 enclosing duly filled Form ARA-01(the application form for Advance 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GST Laws. 9) The Authority for Advance Ruling carefully examined the case and observed the following: 9.1) Observation in respect of Question No.1 Applicant's View In respect of the first question on which Advance Ruling is required, the appellant submitted its view that as per the definition of Composite Supply and Mixed Supply under GST law, where all the goods and services are required to work together in an inter-connected and interdepeded manner it naturally results in a 'composite supply' fully covered under the definition contained in 2(30) irrespective of item - wise values specified in BOQ. Department's View The Authority noticed that as per Section 2 of the Central Goods and Service Tax Act, 2017 (12 of 2017) the 'composite supply' is defined 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... site Contract in GST era as in the GST era both sale and supply of services both are covered under GST Laws. Accordingly, we find that the Contract laid down under Pre GST era be covered under Composite Contract in GST era under GST Laws, if the conditions for 'Composite Supply' are satisfied. 9.3) Observation in respect of Question No.3 Applicant's View The applicant submitted that as per various definitions of 'Works Contract', `Immovable Property', 'Composite Supply', provisions under the CGST Act, 2017 and the judgment of the Hon'ble Supreme Court in the case of Solid Correct Engineering Works 2010 (252) ELT 481 (SC) the Automatic Fare Collection System installed on LMRC station are movable property and the essential element of the said system is the service potion and not the goods portion. Thus, the principal supply 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 obse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the house. They have no separate existence from the house. Articles attached that do not form part of the house such as window blinds, and sashes, an ornamental articles such as glasses and tapestry fixed by tenant are not affixtures. 3) The fixing of the plates (Machinery) to a foundation is meant only to give stability to plant and keep it's operation vibration free. Thus, the applicant is of the view that in order to become an immovable property, the goods have to be attached to the earth for the permanent beneficial enjoyment of the immovable property. It is to note that as held by the Supreme Court in its above stated decision that any annexation should be with the object of permanent beneficial enjoyment of the land or building and any attachment in order to qualify the expression attached to the earth must be for the beneficial attachment of that to which it is attached. In the instant case, 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 r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 1/2018-Integrated Tax (Rate) dated 25.01.2018 has been issued by the Central Government making amendments in the Notification No. 8/2017-Integrated Tax (Rate) dated 28.06.2017. Previously, under the Notification dated 28.06.2017, composite supply of works contract as defined in clause 119 of section 2 of the Central Goods and Service Tax Act, 2017 was attracting duty @ 18% under Heading 9954 (Construction Services) at Sl. No.3. Vide Notification No. 20/2017-Integrated Tax(Rate) dated 22.08.2017, the entries against serial number 3 for item (iii) in column (3) and the entries relating thereto in the Notification No. No. 1/2018-Integrated Tax (Rate) dated 25.01.2018, were substituted with (v) Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Service Tax Act, 2017, supplied by way of construction, erection, commissioning or installation of original works pertaining to,- (a) railways, excluding 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 substitut ..... X X X X Extracts X X X X X X X X Extracts X X X X
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