Page 37 - GSTL_14th May 2020_Vol 36_Part 2

2020 ] COMPOSITE SUPPLY AND MIXED SUPPLY J37
workwear supplied not in the ordinary course of business but under compulsion
imposed by assessee on customer. Services such as washing, maintenance and
transportation, etc. are standalone services and are normally available separately.
Such services independent of service of renting of workwear is not a composite
supply but mixed supply. It was held that the supplies which are not naturally
bundled and not supplied in the ordinary course of business but supplied under
compulsion imposed by the applicant is to be treated as Mixed Supply instead of
Composite Supply.
In an application filed before AAR under GST, WB by Infobase Services
Pvt. Ltd. [2020 (32) G.S.T.L 570] it was found that the applicant is making a bun-
dled supply to the Club of printing service and intermediary service for selling
space for advertisement on behalf of the Club and charging a single price for the
bundle as the project cost for printing. Two services are not naturally bundled or
supplied in conjunction with each other in the ordinary course of business.
Hence the supply is in the nature of mixed supply.
In view of above discussions it can be observed that there is no specific
rule for treating the supply as naturally bundled.
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[Continued from page J27]

(2) The thought process behind this section is to capture those cases
where fraudulent input tax credit has been claimed to reduce the
GST liability or to get export refund. The invoices are found to be is-
sued by racketeers who do not actually carry on any business and
profession. The idea is good, but the wordings of the section may
lead to many more litigation in future. This would be very difficult
for the assessee to prove the genuineness of the invoice. It is also not
clear with the section that whether it will cover only GST invoices
and where the assessee has claimed the input tax credit. What if the
assessee has recorded some invoices in the books of accounts which
were not GST invoice, or the credit has not been claimed on such
invoices may be due to block credit action or may be the supplier is
registered under composition scheme.
Conclusion
Now, by introduction of Rule 86A the blocking of credit has been given a
legal basis. Rule 86A has empowered the Commissioner or an officer authorised
by him in this behalf, not below the rank of an Assistant Commissioner to put a
restriction for maximum of one year on the input tax credit available in the credit
ledger of a person to the effect that it cannot be used for discharging the GST
output liability u/s. 49 or not to allow refund of the credit in some situations. But
this power should not be misused by the department.
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GST LAW TIMES  14th May 2020  37