Case Law Details
In re Sun Knowledge Private Limited (GST AAR West Bengal)
The Goods and Services Tax (GST) has a significant impact on the hiring of electrical equipment, air conditioning systems, sprinkler systems, and emergency power supply units. In a ruling by the Authority for Advance Ruling, West Bengal, in the case of Sun Knowledge Private Limited, it was determined that such supplies would attract a GST rate of 18%. This article examines the implications of this ruling, focusing on the tax rate applicable to the hiring of these facilities and the eligibility of the applicant to claim input tax credit.
Detailed Analysis:
Tax Implications on Hiring of Facilities:
The application filed by Sun Knowledge Private Limited under section 97 of the GST Act sought clarity on the GST rate applicable to the hiring of specific facilities, including electrical equipment, air conditioning systems, and fire safety installations. The Authority for Advance Ruling, West Bengal, analyzed the provisions under the CGST and the WBGST Acts, concluding that the hiring of such equipment and services would attract a GST rate of 18%. This ruling clarifies the tax treatment of such services, deviating from the supplier’s initial charge of 28% under SAC 997314, considering it as a mixed supply.
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