Page 164 - GSTL_21st May 2020_Vol 36_Part 3

410 GST LAW TIMES [ Vol. 36
Personal hearing/Proceedings held on 20-2-2020
7. Sri K.S. Kamalakara, Cost Accountant and duly authorised repre-
sentative of the above concern appeared for personal hearing proceedings on
20-2-2020 before this authority and reiterated the facts already submitted above.
Findings & Discussion
8. We have considered the submissions made by the Applicant in their
application for advance ruling as well as the submissions made by him when he
appeared for the personal hearing. We have also considered the issues involved,
on which advance ruling is sought by the applicant, and relevant facts.
8.1 At the outset, we would like to state that the provisions of both the
CGST Act and the KGST Act are the same except for certain provisions. There-
fore, unless a mention is specifically made to such dissimilar provisions, a refer-
ence to the CGST Act would also mean a reference to the same provisions under
the KGST Act.
8.2 The applicant has filed the application seeking advance ruling
whether the supply of power packs, freight and insurance service and commis-
sioning and installation service is a composite supply or not and this is not relat-
ed to the applicability of any entry of notification and hence the same is not dealt
here. We do not answer whether the supply is covered at 5% or 12%, as the same
is not sought.
8.3 The applicant has stated that there are three components involved
in the overall supply between the supplier and the recipient. They are as under :
(a) Supply of power packs
(b) Freight and insurance related to the power packs
(c) Supply of Installation and Commissioning service.
The applicant himself has stated in para 4 of Annexure C of his submissions that
the installation and commissioning can be carried out by the recipient either by
themselves or they can avail the services from any other supplier of service.
Hence it is clear that the supply of the installation and commissioning is not a
part of the supply contract of power packs and hence is an independent service,
in case that contract of installation and commissioning is also given to the appli-
cant.
8.4 Hence, the supply of installation and commissioning service would
be and independent service and is not a part of the composite supply. The rate of
tax applicable to the installation and commissioning service needs to be applied
for such supply of service. We are not going into the applicable rate of tax as it is
not a part of the question before this Authority.
9. Regarding the other two components, the Purchase Order is verified
and found that the terms of conditions states that the mode of delivery is by road
on freight pre-paid door-delivery basis. Further, the other charges shall read as
Insurance Charges Rs. 2,04,000-00 extra.
9.1 Section 15(2) of the CGST Act, 2017 states that the value of supply
shall include incidental expenses, including commission and packing, charged by
the supplier to the recipient of a supply and any amount charged for anything
done by the supplier in respect of the supply of goods or services or both at the
time of, or before delivery of goods or supply of services. Hence the applicant
has to transport the goods and deliver the power packs to the recipient and the
amount charged to do this is a part of the value of the goods supplied. Hence the
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