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TMI Blog2023 (6) TMI 1296X X X X Extracts X X X X X X X X Extracts X X X X ..... received at the time of replacement. The value of supply made earlier includes the charges to be incurred during the warranty period. Therefore the replacement of the goods and service rendered during the warranty period without consideration does not attract GST separately. The issue has been decided in IN RE: M/S. SOUTH INDIAN FEDERATION OF FISHERMEN SOCIETIES [ 2022 (3) TMI 1299 - AUTHORITY FOR ADVANCE RULING, TAMILNADU] where it was held that the replacement of the goods and service rendered during the warranty period without consideration does not attract GST separately. Thus, GST is not leviable, if goods are supplied as free replacement under guarantee period without any consideration. - UP ADRG 15/2022 - - - Dated:- 5-12-2022 - SHRI RAJENDRA KUMAR AND SHRI VIVEK ARYA, MEMBER Represented by : Mr. T.K. Srivastava (Advocate Authorized Representative) ORDER UNDER SECTION 98(4) OF THE CGST ACT, 2017 UNDER SECTION 98 (4) OF THE UPGST ACT, 2017 1. M/s Prag Industries (India) Pvt. Ltd., a proprietor, is registered with GST vide GSTIN-09AABCP7647L1ZU under trade name M/s Prag Industries (India) Private Ltd bearing principal address at E-7, Talkatora ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hase order and specification(s) of a sample item. Modified Elastomeric Pad to RDSO drg. No. WD-95005/S-1, Alt.7 and RDSO Specification No. WD-20-Misc-95[Rev.-31 of March 2003, Amendment 6 of Sept, 2016 is attached). 3.6 That under guarantee and free replacement no consideration shall be chargeable from the buyer against the supply of replaceable goods, and as such no GST could be charged and payable to the Govt. The replaced items shall be of NIL value. In as much as the consideration for replaced goods has already been included as and when the original supply was made for the first time to the Indian Railways. 4. The applicant has submitted their interpretation of law as under- (1) We appreciate that under guarantee and free replacement no consideration shall be chargeable from the buyer against the supply of replaceable goods, and as such no GST could be charge and payable to the Govt. The replaced items shall be of NIL value. In as much as the consideration for replaced goods has already been included as and when the original supply was made for the first time to the Indian Railways. (2) The applicant can supply the parts only after accepting the condition as ment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sonal hearing on 15.11.2022 which was attended by Mr. T.K. Srivastava Authorized Representatives during which he reiterated the submissions made in the application of advance ruling. DISCUSSION AND FINDING 7. At the outset, we would like to make it clear that the provisions of both the CGST Act and the UPGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the UPGST Act. Further for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / UPGST Act would be mentioned as being under the CGST Act . 8. We have gone through the Form GST ARA-01 filed by the applicant and observed that the applicant has ticked following issue on which advance ruling required- As to whether if goods are supplied as free replacement under guarantee period without any consideration, what would be the tax liability under GST. 9. In the letter/purchase order dated 21-04-2021 issued by the Principal Chief Material Manager, South Central Railway to M/s Prag Industries (India) Pvt. Ltd. L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herance of business However, gifts not exceeding fifty thousand rupees in value in a financial year by an employer to an employee shall not be treated as supply of goods or services or both. 3. Supply of goods (a) by a principal to his agent where the agent undertakes to supply such goods on behalf of the principal; or (b) by an agent to his principal where the agent undertakes to receive such goods on behalf of the principal. 4. Import of services by a person from a related person or from any of his other establishments outside India, in the course or furtherance of business. 12. The applicant is engaged in supply of Elastomeric pads without any consideration (free of cost) during the warranty period as mentioned in para 9 of vide P.O. No. 38201145101516 dated 30.04.2021 of Principal Chief Material Manager, South Central Railway to the M/s Prag Industries (India) Pvt. Ltd. It is an admitted fact that the warranty is a promise or guarantee for the goods/services supplied by the applicant. 13. That under guarantee and free replacement no consideration shall be chargeable from the buyer against the supply of replaceable goods, and as such no GST could be charge and p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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