Page 162 - GSTL_23rd July 2020_Vol 38_Part 4

528 GST LAW TIMES [ Vol. 38
question that should be asked is what is the essential nature of the composite
supply and which element of the supply imparts that essential nature to the
composite supply.
62. Thus, it is abundantly clear from the aforementioned circular that
value is only the guiding factor, and not the sole factor for determining the prin-
cipal supply in the bundle of supply. Therefore, the Appellant’s contention based
on the consumption pattern of the printing consumables, wherein consumption
of Electroink is 41% in terms of the volume, thereby asserting the Electroink as
the Principal supply only on the basis of its highest consumption among all the
printing consumables, without establishing the fact that the same (Electroink) is
imparting the essential nature of the supply is feeble and slight, and clearly not
tenable.
63. Now, we refer to the other illustrations, cited by the Appellant in
support of their claim. Some of these are mentioned hereinbelow :
(i) Reference has been drawn to Q-6 page 26 of 3rd Edition FAQ’s dat-
ed 15-12-2018, wherein it was illustrated as under :
When a consumer buys a television set and he, also gets a warranty
and a maintenance contract with the TV, this supply is a composite
supply. In this example, supply of TV is the principal supply, war-
ranty and maintenance service are ancillary.
From the above illustration, it may be inferred that supply of the
T.V. is the principal supply because it provides the central and es-
sential nature of the supply, and all other supplies, whether supply
of warranty or maintenance contract are ancillary in nature, as the
same is directly dependent on the T.V. To elaborate further, if there
is no supply of T.V., there would not be any supply of either war-
ranty or maintenance contract. That means, they do not exist
standalone. There has to be a supply of T.V. for the relevance and
significance of the supply of warranty or maintenance contract.
However, in the present case, this is definitely not so, as all the sup-
plies i.e. Electroink, and other consumables comprising blanket,
photo imaging plate, binary ink developer, HP imaging oil, blanket
web and other machinery products are equally important and in-
dispensable, as the absence of any one of these will adversely im-
pact the functionality of the H.P. Indigo printers.
(ii) Reference has been drawn to Circular No. 32/06/2018-GST, dated
12-2-2018, wherein it was illustrated as under :
Health care services provided by the clinical establishments will in-
clude food supplied to the patients. Therefore, food supplied to the
in-patients as advised by the doctor/nutritionists is a part of com-
posite supply of healthcare and not separately taxable. However,
other supplies of food by a hospital to patients (not admitted) or
their attendants or visitors are taxable.
In the above illustration, it is clearly revealed that the Health care
services is the principal component of the composite supply, and
the food supplied to the patients are ancillary in nature, as the same
is additional to the main supply, which in this case is the supply of
health care, which is imparting the true essence or the character of
the composite supply, called supply of health case facility. The sup-
ply of the food to the patient are in the nature of ancillary owing to
the reason that supply of the health care can still continue even
without the supply of the food. However, there is no meaning of
GST LAW TIMES  23rd July 2020  162