GST rate depends on nature of activity performed & not on form of agreement

In re Hyundai Rotem Company (GST AAR Karnataka)

Nature of activity determines the GST rate, separately identifiable cost center activities cannot be termed as composite supplies

The AAR, Karnataka in the matter of In Re: M/S. Hyundai Rotem Company [Advance Ruling No.- KAR ADRG 26/2022 dated August 12, 2022] held that the supplies made by all the Cost Centers of Delhi Metro Rail Corporation (“DMRC”) are not to be considered as a ‘composite supply’.

Facts:

M/s. Hyundai Rotem Company (“the Applicant”) is a foreign company incorporated in South Korea and is engaged in the manufacture, supply, testing, commissioning, and training in respect of rolling stock. The Applicant was a successful bidder to the tender invited by DMRC for design, manufacture, supply, testing, commissioning, and training. The Applicant entered into a contract with DMRC for the execution of the contract awarded.

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