Case Law Details
In re Arpijay Fabricators Pvt. Ltd (GST AAR Madhya Pradesh)
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;
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 supply would be classified under Heading no.9988
FULL TEXT OF ADVANCE 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.
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Still the rate of GST on Body Building Activity on the chassis supplied by individual Customer falls under Service Code 9988 or HSN No. 8707.
According to us if the body building activity is done by any body builder on behalf of chassis manufacturer, it should fall under HSN Code. In Such cases, the ownership of the chassis including body built and mounted on same chassis remains with chassis manufacturer.
If the chassis is given to any body builder only for body building according to his needs and subject to prevailing body codes, the ownership of the chassis remains with the supplier only and not of body builder. Normally, Such chassis / vehicles are registered in the same name on which the sales invoice stands.
Whereas, a ready built body can be sold to any body – one who purchases from ready stock with dealer.
Please clarify whether GST on Body Building Activity should be charged @ 18% under SAC 9988 or HSN code 8707 @ 28%
As of now almost all body builders in India are paying GST @18% under SAC code 9988