GST Rates for Outboard Motor Engines and Spare Parts for Fishing Vessels

In re Ansalam Ancil, M/s. J.ARC Communication & Power Solutions (GST AAR Kerala)

Introduction: In the recent ruling by the GST AAR Kerala, the tax rates on various aspects related to outboard motor engines, spare parts, and warranty repairs have been clarified. The applicant, M/s. J.ARC Communication & Power Solutions, sought advance rulings on multiple issues related to the GST implications on their business operations, including the rate of tax on outboard motor engines, warranty repairs, and supply to the Defense Department.

Detailed Analysis:

1. Rate of Tax on Outboard Motor Engines for Fishing Vessels (Question 1):

• The ruling confirms that outboard motor engines and their spare parts supplied for use in fishing vessels (Customs Tariff Heading 8902) attract a GST rate of 5%. This clarification aligns with the provisions of Schedule I of Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017.

2. GST on Warranty Repairs (Question 2):

• The ruling establishes that during the warranty period, the supply of goods or services without consideration in discharge of warranty obligations is not liable to GST. However, any additional consideration received for such supplies will be subject to GST as per the applicable rate.

3. Rate of Tax on Repair of Fishing Vessels (Question 3):