Page 34 - GSTL_14th May 2020_Vol 36_Part 2

J34 GST LAW TIMES [ Vol. 36
any immovable property wherein transfer of property in goods (whether as
goods or in some other form) is involved in the execution of such contract;
In a contract for construction of immovable property wherein there is of
supply of service along with the supply of goods the same would be treated as
supply of service. It will be classified as composite Works Contract Service. For
the purpose of treating the Works Contract Service there must be construction of
immovable property. Composite Supply in case of Works Contract Service will
always be treated as supply of service by virtue to Schedule II to Section 7 of the
CGST Act, 2017.
In an application filed before AAR under GST by TATA Projects Limited,
the applicant had a contractual obligation to supply the materials and also to
erect the civil, electrical and Air-conditioning system, Structural and Mechanical
system, Facility Fluid System, Safety and Fire protection system, Instrumenta-
tion, control and data acquisition system. Such erection and installation is to be
done to the ‘Integrated Cryogenic Engine & Stage Test Facility’ by means of civil
works. It involves the transfer of ownership of these equipments, instruments,
consumables, civil and electrical goods involved in the erection, construction and
installation of these systems. The Integrated Cryogenic Engine & Stage Test Facil-
ity itself is an immovable structure erected at the site in Mahendragiri.
Applying the above to the case at hand, the erection of the systems at site
makes the system a permanent fixture, i.e. immovable property. Thus it is clear
that in the case at hand, the applicant supplies materials and in conjunction pro-
vides the service of erection of the Systems at the Integrated Cryogenic Engine &
Stage Test Facility making all the systems together as an immovable property.
Therefore, the whole contract for ‘Establishment of an Integrated Cryogenic En-
gine & Stage Test Facility’ at ISRO Propulsion Complex (IPRC), Mahendragiri at
ISRO Propulsion Complex (IPRC), Mahendragiri is also a ‘Works Contract’.
6.5 Schedule II to CGST Act states
6. Composite supply
The following composite supplies shall be treated as a supply of services,
namely :-
(a) works contract as defined in clause (119) of section 2;
Therefore, the present supply is a composite supply to be treated as a supply of
services.
Supply of food articles
In a contract for supply of goods being food or any other article for hu-
man consumption by way of service or as part of any service or any other man-
ner whatsoever being a composite supply of goods and service shall be treated as
supply of service.
Schedule II of Section 7 of the CGST Act, 2017
6. Composite supply
The following composite supplies shall be treated as a supply of services,
namely :-
(a) works contract as defined in clause (119) of section 2; and
(b) supply, by way of or as part of any service or in any other
manner whatsoever, of goods, being food or any other article
for human consumption or any drink (other than alcoholic

GST LAW TIMES  14th May 2020  34