Page 161 - GSTL_23rd July 2020_Vol 38_Part 4

2020 ] IN RE : H.P. SALES INDIA PVT. LTD. 527
blanket web and other machinery products are equally important and are indis-
pensable for the printing function of the Indigo Presses, which is also vindicated
by the Chartered Engineer’s certificate, wherein he has testified as under :
“all the consumables shall be required to be required to be supplied as
bundle to the customer to enable the customer to achieve the print, func-
tionally, the print shall not be available to the customer unless all the goods
are used in the prescribed manner to take the printout.
To conclude, all Indigo press consumables are necessarily required to be
consumed together at the same time for effecting the desired output.
Thus, the Appellant themselves have admitted that there is not any specific ele-
ment under this bundle of supplies, which is more significant than others, ruling
out the possibility of presence of any principal supply. The above submissions
and the evidence produced by the Appellant themselves in the form of the Char-
tered Engineer’s certificate also lead us to conclude further that there are no
components in this bundle of supplies, which are ancillary in nature, as all the
components are indispensable in nature, and not additional or subordinate in
nature. None of the components are subordinate to any one element of the sup-
plies. That is, none are providing additional support to any specific consumable
items. All these consumables are being consumed together to achieve the desired
output. In absence of any one of these consumables, the entire printing function
will be stalled, which clearly shows the importance of each of the components of
the bundled supplies. At the same time, it also shows that none of supplies are
ancillary in nature.
59. From the above discussions, it is established beyond doubt that the
bundled supplies by the Appellant to its customers has no principal supply,
which is one of the primary conditions for any supply to be treated as the com-
posite supply as envisaged under Section 2(30) of the CGST Act, 2017.
60. The Illustration provided under clause (30) of Section 2 of the CGST
Act, 2017, was also heavily relied upon by the Appellant in the additional sub-
missions filed by them, and it is observed that in the proposed illustration, the
supply of goods is the principal supply, and the supply of packing materials,
supply of the transportation services, insurance services are ancillary in nature,
as all these supplies are directly related to the goods, which are being transport-
ed. That is, ail these supplies have no meaning or existence in absence of the
goods. Because, it is the goods only, which are being packed, insured, and then
transported to a particular destination. This submission was discussed in para
No. 57 of the appellate order. It is discussed therein that the example is not appli-
cable to the present case as in the present facts and circumstances of the case, as
these supplies are completely independent in nature, and is not related in any
manner to the Electroink, which is being claimed by the Appellant as the princi-
pal supply. All these printing consumables i.e. blanket, photo imaging plate, bi-
nary ink developer, HP imaging oil, blanket web and other machinery products
can be very much supplied independently by the Appellant to its customers.
61. To support their claim, the Appellant have cited the various illus-
trations incorporated in CBIC flyers and Circulars issued in respect of the com-
posite supply, which inter alia include one illustration cited in the Circular No.
32/06/2018-GST, March 1, 2018, wherein it was clarified by the CBIC that which
part of the composite supply is principal supply, must be determined keeping in
view the nature of supply involved. Value may be one of the guiding factors in
determination but not the sole factor. It was further mentioned that the primary
GST LAW TIMES  23rd July 2020  161