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2020 ] COMPOSITE SUPPLY AND MIXED SUPPLY J33
Further it can be analyzed that for the purpose of composite supply, it is not neces-
sary that single price should be charged for all the supplies. Different price could
be charged for different supply of goods or services. However single rate of tax
would apply to all the supplies being that of Principal Supply.
If large number of service receivers of such bundle of services reasonably
expect such services to be provided as a package, then such a package could be
treated as naturally bundled in the ordinary course of business.
The nature of the various services in a bundle of services will also help in
determining whether the services are bundled in the ordinary course of business.
No straight jacket formula can be laid down to determine whether a ser-
vice is naturally bundled in the ordinary course of business. Each case has to be
individually examined in the backdrop of several factors some of which are out-
lined below.
Supply of ancillary services in case of supply of construction services of apartment
- Naturally bundled
In a Real Estate Industry it was observed that the Promoter Developer
while supplying construction services in form of sale of flats also supply the an-
cillary services being the PLC Charges, Club Charges, Car Parking and others. In
this case supply of construction services is the Principal Supply. Further the an-
cillary supply is not capable of being supplied individually.
CESTAT Regional Bench, Allahabad in case of Logix Infrastructure Pvt.
Ltd. v. C.C.C & S.T Noida [2019 (25) G.S.T.L. 59 (Tri. - All.)] - Appellant has pro-
vided the construction services and charged further on account of Preference Lo-
cation Charges (pool facing, park facing, corner flat; Floor - first floor, top floor,
Vastu), External/Internal Development charges, Electric sub-station charges,
club membership, legal charges. Appellant argued that such charges does not
have independent existence and they are associated with the provision of Resi-
dential Complex Service. Further such charges are various elements of the main
services and cannot be treated as separate. Such services are bundled together.
Held that such services are eligible for abatement under Notification No.
26/2012.
Supply of maintenance services - Two or more shall be taxable supplies
Composite Supply as defined u/s. 2(30) covers within the ambit two or
more taxable supplies. If there is supply of one taxable and other is exempt.
In an application filed before AAR under GST, Haryana by Keysight
Technologies International India Pvt. Ltd. reported in 2020 (32) G.S.T.L 126 - Agilent
being the owner of the premises has entered into lease Applicant for leasing out
the premises. The applicant has also entered agreement with other associate
companies on the same terms and conditions. As a part of agreement electricity
was supplied to the group company through grid. Supply of electricity to the
extent of it being supplied through grid is exempt from GST and, therefore, the
condition of two or more taxable supplies is not satisfied.
The supply of utilities and supply of electricity are neither naturally
bundled together nor are they supplied in conjunction with each other.
Composite Supply v. Works Contract Service
Section 2(119) “works contract” means a contract for building, construc-
tion, fabrication, completion, erection, installation, fitting out, improvement,
modification, repair, maintenance, renovation, alteration or commissioning of
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