Page 150 - GSTL_23rd July 2020_Vol 38_Part 4

516 GST LAW TIMES [ Vol. 38
made. As is evident, the ElectroInk is the most predominant supply in the bun-
dle. The ink flows through the entire process to effectively generate a print and
produce the desired output. It is the most essential and highest consumed prod-
uct (in terms of volume) in a printing cycle, evident from the fact that 41% of the
consumption in terms of value is of ink. The ink determines the quality and reso-
lution of the image being printed, in the manner required by the customer.
46. Additionally, the Chartered Engineer Certificate confirms that the
ElectroInk is the fundamental supply amongst the consumables for the purpose
of effectively completing the printing process.
47. The principles applicable for Composite supply are satisfied by the
Appellant.
Findings in impugned Order
Para 5.4 page 13
“In this regard useful reference can be made to GST Flyers issued
by CBEC in which certain tests are laid down which are listed be-
low to ascertain supply of goods or services or both in the ordinary
course of business.
(1) The perception of the consumer or the service receiver;
(2) Majority of service providers in a particular area of business
provide similar bundle of services;
(3) The nature of the various services in a bundle of services;
(4) There is a single price or the customer pays the same amount,
no matter how much of the package they actually receive or
use;
(5) The elements are normally advertised as a package;
(6) The different elements are not available separately;
(7) The different elements are integral to one over all supply if
one or more is removed, the nature of supply would be affect-
ed;
As the impugned transaction fails to satisfy the tests mentioned
above, the supply of Electroink along with consumables cannot be
considered as a composite supply as defined under section 2(30) of
the GST Act.”
Our submissions
48. The approach adopted by the Learned Advance Ruling Authority
on basing its conclusion merely on the alleged non-satisfaction of a single illus-
trative factor without giving regard to the terms of contract, business arrange-
ment and satisfaction of other necessary requirements. While the tests to be ap-
plied as per the flyer have been laid out in the impugned order, the satisfaction
of these tests has not been specifically discussed, except for one of the tests i.e.
elements not being available separately. The Appellant has explained the satis-
faction of these tests explicitly in its submissions made before the Learned Au-
thority, which has not been judiciously considered.
Illustration provided in the definition of composite supply under Section
2(30) of the CGST Act (similar provision in the Maharashtra State GST Act) :
• Where goods are packed and transported with insurance, the sup-
ply of goods, packing materials, transport and insurance is a com-
posite supply and supply of goods is a principal supply.
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