In Re : Arpijay Fabricators Pvt. Ltd.
GST
2018 (8) TMI 284 – AUTHORITY FOR ADVANCE RULINGS, MADHYA PRADESH – 2018 (16) G. S. T. L. 157 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULINGS, MADHYA PRADESH – AAR
Dated:- 30-6-2018
Final Order No. 04/2018
GST
Shri Rajeev Agrawal, Joint Commissioner, And Commissioner CGST And Central Excies And Shri Manoj Kumar Choubey, Joint Commissioner of State Tax, Commircial Tax Division
For The Applicant : Krishan Garg, Praveen Gupta And K. Soni
RULING
1. At the outset we would like to make it clear the provisions of both the CGST Act, 2017 and the MPGST Act, 2017 are the same except for certain provisions. Therefore, unless a mention is specifically made to such similar provisions, a reference to the CGST Act, 2017 would also mean a reference to the same provisions under the MPGST Act, 2017.
2. BRIEF FACTS OF THE CASE:
2.1 M/s. Arpijay Fabricators Private Limited (hereinafter referred to as 'the Applicant'), having their registe
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
tions have been posed before the Authority, with reference to the activity undertaken by the Applicant:
3.1 Whether the supply mode by us is to classified as supply of goods or supply of services?;
3.2 What would be the appropriate classification and applicable rate of tax for the above transaction?
4. DEAPRTMENT'S VIEWPOINT:
Central/MPGST Act, 2017 section 2 read with section 8-in the case of bus body building there is supply of goods and services. Thus, classification of the composite supply as goods or service would depend on which supply is the principle supply which may be determined on the basis of facts and circumstances of each case.
5. RECORD OF PERSONAL HEARING:
5.1 Shri Krishan Garg, CA; Shri Praveen Gupta, Accounts Manager of the Applicant and Shri S. Soni, Assistant Accounts Manager of the Applicant appeared on behalf of the applicants for personal hearing on 22.06.2018 and reiterated the submissions already made in the application. They also sought a day's time to
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
as given us job work for making body on chasis. Thus it is not the case of only supply of goods'.
We, therefore of the view that supply made by us is a composite supply of goods and services, however, since the predominant intention of the buyer here is to get services, hence it should be classified as services and should be charged GST @18%'
6. DISCUSSIONS AND FINDINGS:
6.1 We have carefully considered the submissions made by the applicant \n the application. We find that the activity and the question raised before us has been suitably clarified and dealt with in Circular No.34/08/2018-GST dtd.01.03.2018, where in the Fitment Committee to GST Council in its meeting held on 9th , 10th & 13th January has clarified this particular issue. The same is reproduced hereunder-
ISSUE- Whether activity of Bus Body Building, is a supply of goods or services?
CLARIFICATION – In the case of bus body building there is supply of goods and services. Thus, classification of this composite supply
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
f two or more supplies, one of which is a principal supply, shall be treated as a supply of such principal supply;” The term 'Principal Supply' has been categorically defined under Section 2(90) of the CGST Act 2017 and corresponding entry in MPGST Act, 2017; '”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.'
6.4 Though the Applicant, in their additional submission dtd.23.06.2018 have briefly described the process being undertaken by them during the course of body building of buses, they have not come forward with the details of component of 'Goods' and 'Services' involved in the supply under question. However, they have pleaded that though the supply in this case would be a 'Composite Supply' but depending upon the predominant intention of the buyer, it should be classified as 'Service'. On a careful consideration of submissions mad
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
able as per Heading No.9988. However, due to incomplete information provided by the Applicant, the Authority finds itself constrained to provide any definitive ruling on this aspect.
RULING
7. The Advance Ruling on questions posed before the authority are answered as under:
7.1 In respect of Question 1, we hold that the activity of Body Building undertaken by the Applicant, carried out on the chasis supplied by the principal in the capacity of a job worker, would amount to 'Composite Supply' as define under CGST Act 2017/MPGST Act 2017;
7.2 In respect of Question No.2, we hold that the rate of tax on such Composite Supply would be determined by the predominant component involved in such Composite Supply in terms of Section 8(a) of the CGST Act 2017, depending upon the character of the body being built on the chasis, which would eventually be classifiable under Chapter 87 of the Tariff. On the other hand, if the predominant element happens to be the Service part, then the Principal
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =