2018 (11) TMI 282 – AUTHORITY FOR ADVANCE RULINGS, KERALA – 2018 (18) G. S. T. L. 834 (A. A. R. – GST) – Rate of tax – Marine propellers, Rudder set, Stern tube set, Propellers shaft, MS shaft for couplings – classification of parts of fishing – replacement of parts during warranty period constitute supply under GST or not – input tax credit on purchase of raw materials.
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Rate of tax – Marine propellers, Rudder set, Stern tube set, Propellers shaft, MS shaft for couplings – Held that:- As per case of SRI. DHARSAK. V.P. AND SARASWATHI METAL INDUSTRIES [2018 (7) TMI 142 – AUTHORITY FOR ADVANCE RULING, KERALA] ruling issued that commodities such as Marine Propellers, rudder set, stern tube set, propeller shaft and MS shaft for couplings used as a part of fishing /floating vessels would come under entry 252 of 1st schedule and taxable @5% GST. However there is no clarity on the tax rate applicable to the parts shipping vessels as the raw materials attract 18% tax.
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Classificatio
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higher tax rate than the finished products or parts, input tax paid is eligible to avail as input tax credit subject to a condition that such goods or services or both are used or intended to be used in the course or furtherance of his business – As per Section 54 (3) of the GST Law, where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies, un-utilized input tax credit at the end of any tax period can be claimed as refund except input tax paid under IGST.
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Ruling:- The tax rate of Marine propellers, Rudder set, Stern tube set, Propellers shaft, MS shaft for couplings used as part of fishing vessels, factory ships and other vessels for processing or preserving fishery products are taxable @5% GST.
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All parts of fishing / floating vessels come under the HSN Code 8902 are taxable @5% under Serial No.252 of 1st Schedule. – AAR No. KER/25/2018 Dated:- 20-10-2018 – SHRI. B.G. KRISHNAN IRS AND SHRI B.S. THYAGARAJABAB
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NCE RULING, KERALA ruling issued that commodities such as Marine Propellers, rudder set, stern tube set, propeller shaft and MS shaft for couplings used as a part of fishing /floating vessels would come under entry 252 of 1st schedule and taxable @5% GST. However there is no clarity on the tax rate applicable to the parts shipping vessels as the raw materials attract 18% tax. As per HSN 8902, fishing vessels, factory ships and other vessels for processing or preserving fishery products are taxable @5% GST. As per serial No.252 of 1st schedule, parts of goods of heading 8902 are also taxable @5% GST. As there is specific inclusion of parts of goods covered under HSN 8902, under 15t Schedule, the general tax rate applicable to machinery parts vide HSN 8487 has no applicability, if the vessels are used for fishing purpose. The replacement of parts during warranty period is a free supply. Warranty is a written guarantee, issued to the purchaser of goods by its manufacturer, promising to re
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