In Re: M/s. Paras Motor Industries,
GST
2018 (7) TMI 1422 – AUTHORITY FOR ADVANCE RULINGS HARYANA – 2018 (15) G. S. T. L. 139 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULINGS HARYANA – AAR
Dated:- 26-4-2018
HAR/HAAR/R/2018-19/8
GST
SANGEETA KARMAKAR AND VIJAY KUMAR SINGH MEMBER
ADVANCE RULING NO.HAR/HAAR/R/2018-19/8
(In Application No. 8 dated 30.01.2018)
Present for the Applicant: None present from applicant side
1. The applicant is engaged in the business of fabrication & fitting out bus bodies on the chassis supplied by its customers. The customers are mainly roadways corporations of various states. The bus bodies are constructed & fitted under a written contract as per the specifications provided by the customers. Sample copies of two contracts are attached herewith for ready reference.
2. The party in its application has represented
(i) That some authorities consider the transaction as contract of sale of goods whereas some other consider the transaction
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ailash Engineering Co. Vs. State of Gujarat' reported as 15 STC 574 wherein it has been held that the contract for building, erecting & furnishing of coach bodies on under frames supplied by the railway was not contract for the sale of goods. Further the Hon'ble High Court of Rajasthan recently vide his order dated 17/02/2017 in the case of M/s. Mohindra Coach Factory Pvt. Ltd. v/s Commercial Tax Officer, Special Circle- 3, Jhalana, Jaipur has held that the contract of bus building/fabrication is not a sale but work contract.
(iv) That certain dealers engaged in building of body or fabrication or mounting or fitting on the chassis is provided by other person as being done in the case of applicant sought clarification from the office of Asst. Commissioner CGST Jaipur who has clarified vide Letter No. IV (16)/45/11/Diva.misc/ 2017/850 or 25.08.2017 as under:
It is very much clear that the making body of buses as per customers specification on chassis provided by the other perso
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ation of bus bodies/supply of bus bodies mounting/fitting on chassis supplied by various dealers/customers. That the applicant supplies bus bodies along with fitting and fabrication services. Major part of this process is supply of bus bodies and fabrication/fitting of bus bodies is an associated work along with this supply. Therefore, the supply of bus body by the dealer may be covered under HSN code 8707.
RECORDS OF PERSONAL HEARING – 2ND PROVISO TO SECTION 98(2) OF CGST/HGST ACT 2017
5. Opportunity for personal hearing was granted to the applicant on 25.04.2018, however, the applicant vide letter dt.23.04.18, submitted that they have already submitted copies of supporting documents along with their application and there is nothing new to add; that contents of their application and documents submitted may be considered.
DISCUSSIONS AND FINDINGS OF THE AUTHORITY
6. The question to be decided in the instant case is, whether the activity of the applicant, in which they fabricate/mou
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ndled 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, Principal supply has been defined under Section 2(90) of the CGST/SGST Act, 2017, as under:
(90) “principal supply” means the supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary;
8. In the instant case, it is. only the chassis which is supplied by the customers of the applicant and in fact no treatment or process is undertaken by the applicant on the chassis itself, except fitment/mounting of bus body on the same. At the same time, bus body building involves use of raw materials/inputs etc., for manufacture/fabrication of bus body and the
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