Furniture vs Fixtures (meaning and effect of the same under GST)

Furniture vs Fixtures (meaning and effect of the same under GST)

In this article I am going to give short glimpse over different interpretations usually we hear from different school of peoples about of the definition of furniture and fixture.

And

The importance of the same under GST Law.

School 1:

This school taught us the furniture and fixtures are one and the same, as we will capitalize the same in the books of accounts as one line item.

In my view:  if we are doing the capitalization in one-line item it does not mean that both are one and same.

Ex1. the Sanskrit name of lotus flower is i.e. “Pankaja”

It is consisting of two words

• paṅka means mud
• ja means born

lotus flower born from mud so only we will call as  “Pankaja”

There are many other things born from mud, we will not call everything as “Pankaja”

So, the literal interpretation of particular word is important. To know effect of “GST” on the same.

Ex2. Sometimes we will write land and building as a single line item in Balance Sheet it does not mean that both are one and the same.

So, only I will not agree with the taught of first school. 

School 2:

Second school taught us the meaning based on the decided case laws in old tax regime and literal dictionary meanings.

As per oxford dictionary:  

Furniture: means objects that can be moved such as tables, chairs and beds, that are put into a house or an office to make it suitable for living or working.

Fixtures: Furniture fixed in a house or an office and that you do not take with you when you move.

As per decided case laws of SC:

Craft Interiors Pvt. Ltd. vs. CCE, Bangalore (2006 (203) ELT 529 (SC)].

In the above case law, supreme court of India defined the Furniture as under:

Furniture refers to “moveable” items such as desk, tables, chairs required for use or ornamentation in a house or office. Therefore, the furniture could not have been held to be immoveable property.

From the above we can summarize as under:

Is fixture is good as per GST?

In this background I am going to analyze whether can we call Fixture as good in GST?

In GST goods defined as under:

2(52) “goods” means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply.

In order to call as good it has to possess below characteristics:

1. It has to be movable

2. Other than money and securities but includes actionable claim, growing crops, grass and things attached to land.

In order to call as good it has to be “moveable” and Fixtures is not movable same will not fall under the nest of the Good.

As per my knowledge there is no land mark judgments regarding the above subject in GST regime.

I am awaiting for the same.

Above content is only the views & opinion of authors about referred subject.