In Re : Switching Avo Electro Power Ltd.
GST
2018 (4) TMI 810 – AUTHORITY FOR ADVANCE RULING , WEST BENGAL – 2018 (13) G. S. T. L. 84 (A. A. R. – GST), [2018] 2 GSTL (AAR) 64 (AAR)
AUTHORITY FOR ADVANCE RULING , WEST BENGAL – AAR
Dated:- 21-3-2018
Case Number 04 of 2018
GST
Vishwanath Member And Partha Sarathi Dey Member
\nSri Rabindra Agarwal, Director, Switching Avo Electric Power Limited
\nORDER
\n1. The Applicant, stated to be a supplier of power solutions, including UPS, servo stabiliser, batteries etc. wants a ruling on the classification of the supply when it supplies UPS along with the battery. More specifically, he wants a ruling on whether such supplies can be treated as Composite Supply within the meaning of Section 2(30) of the CGST\/WBGST Act, 2017 (hereinafter referred to as “the GST Act”). An Advance Ruling is admissible on this issue under Section 97 (1) of the GST Act.
\n2. The Applicant also declares that the issue raised in the application is not pen<\/p>\n
= = = = = = = =<\/p>\n
Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n her rectangular (including square) = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n T Act as “the supply of goods\/services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary”. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n the battery is not supplied or removed. It cannot function as a UPS unless the battery is attached. However, what needs to be considered is whether or not these two items are “naturally bundled”. The stated Illustration to Section 2(30) of the GST Act refers to a supply where the ancillary supplies are inseparable from the principal supply and form an integral part of the composite supply. Note 3 also refers to a composite machine as the one consisting of two or more machines fitted together to form a whole. When a UPS is supplied with built-in batteries so that supply of the battery is inseparable from supply of the UPS, it should be treated as a composite supply and as a composite machine in terms of Note 3. The UPS being the principal supply, the relevant tariff head for the composite supply will be 8504 under serial no. 375 of Schedule III in terms of Notification No. 01\/2017-Central Tax (Rate) dated 28\/06\/2017 (1125-FT dated 28\/06\/2017 of the State tax). = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n UPS – the principal supply. The argument is fallacious. Goods are naturally bundled in a supply contract if the contract is indivisible. For example, a works contract within the meaning of section 2 (119) of the GST Act is a composite supply. Steel, cement and other goods and services supplied are inseparable in a contract for civil construction. The recipient has not contracted for the supply of steel, cement or architectural service, but for the service of constructing the civil structure, where all these supplies are inseparable and, therefore, naturally bundled. The contract for the supply of a combination of UPS and battery, if not built as a composite machine, is not indivisible. The recipient can split it up into separate supply contracts if he chooses. The goods supplied in terms of such contracts are, therefore, no longer naturally bundled and cannot be treated as a composite supply. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" In Re : Switching Avo Electro Power Ltd.GST2018 (4) TMI 810 – AUTHORITY FOR ADVANCE RULING , WEST BENGAL – 2018 (13) G. S. T. L. 84 (A. A. R. – GST), [2018] 2 GSTL (AAR) 64 (AAR)AUTHORITY FOR ADVANCE RULING , WEST BENGAL – AARDated:- 21-3-2018Case Number 04 of 2018 GSTVishwanath Member And Partha … Continue reading “In Re : Switching Avo Electro Power Ltd.”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-11443","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/11443","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11443"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/11443\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11443"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11443"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11443"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\n
\nIII
\n375
\n8504
\nTransformers Industrial Electronics; Electric Transformers; Static Convertors (UPS)
\n
\nIII
\n376A
\n8506
\nPrimary cells and primary batteries
\nInserted w.e.f 15\/11\/17 vide Notification No. 41\/2017-Central (Rate) dated 14\/11\/17
\n
\n4. Explanation (v) to Notification No. 01\/2017-Central Tax (Rate) dated 28\/06\/2017 (1125-FT dated 28\/06\/2017 of the State Tax) clarifies that the Rules for Interpretation of the First Schedule to the Customs Tariff Act, 1975 (hereinafter referred to as “the Tariff Act”) including Section and Chapter Notes and General Explanatory Notes shall, insofar as may be, apply to interpretation of the above Notifications. Rules framed under Section 2 of the Tariff Act are to be followed for interpretation of the Section or Chapter Notes mentioned above.
\n5. Note 3 to Section XVI of the Tariff Act defines a composite machine as the one consisting of two or more machines fitted together to form a whole. <\/p>\n
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\nNote 3, therefore, is applicable, in this context, to composite machines. Other machines, designed for the purpose of performing two or more complementary or alternative functions, however, can be classified with the help of Note 3 only if they are naturally bundled and supplied in conjunction with one another in the ordinary course of business.
\n7. It appears that batteries are classified under Tariff Heads 8506 and 8507 of the First Schedule of the Tariff Act. The basic difference between the two Tariff Heads is the ability of accumulators to be recharged, whereas primary cell batteries cannot be recharged. An accumulator is an energy storage device, which accepts energy, stores it and releases it when needed. Rechargeable batteries, flywheel energy storage, capacitors etc. are examples of accumulato<\/p>\n
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\n10. But a standalone UPS <\/p>\n
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\n12. If a combination of goods that does not amount to a composite supply is being offered at<\/p>\n
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