Page 66 - GSTL_13th August 2020_Vol 39_Part 2

152 GST LAW TIMES [ Vol. 39
mud program, mud engineering services, supply of complete line of drilling
mud, completion fluids and wellbore cleanup chemicals/additives. A compre-
hensive reading of scope of work (as provided in the Contract including the aspects
thereof) gives an understanding that the Contract is not merely for supply of ad-
ditives/chemicals/consumables or not merely for providing for services. In the
perspective of the customer or recipient i.e. M/s. OIL, the Contract is a single
package comprising of ‘supply of services and supply of goods’.
9.6 Under the Contract, the applicant is obligated to provide complete
Mud Engineering and Drilling Waste Management Services. For provision of
such services, it is essential to have all technical support (equipment/tools),
technical personnel and required chemicals/additives. These components are
clearly incidental and ancillary to main supply i.e. providing of mud engineering
and drilling waste management Services for 3(three) HTHP Wells in KG Basin. If
any one or more of these components is removed, the very nature of main supply
i.e. provision of mud engineering and drilling waste management services would be
affected. It also defeats the very purpose of the Contract and in such a scenario;
there appears no service to be provided by the Applicant. Thus, the scope of the
work to be provided by the Applicant under the Contract is a combination of
supply of service and supply of goods which are naturally bundled in the ordi-
nary course of business - wherein the principal supply is supply of service (mud
engineering or drilling waste management services) and supply of goods viz,
mud chemicals and mud additives which form incidental or ancillary supply to
the principal supply.
9.7 Now, We proceed to examine the second condition of definition of
‘Composite Supply’ i.e. as to whether the supply of service and supply of goods are
provided in conjunction with each other or not. The word conjunction has the follow-
ing meanings as per the dictionary meanings (online version) as stated hereunder :
“The action or an instance of two or more events or things occurring at the
same point in time or space” - Oxford English Dictionary (online version)
“Occurrence together in time or space” - Marriam Webster Dictionary
(online version)
“the coinciding of two or more events” - Chambers Dictionary (online ver-
sion)
“the situation in which events or conditions combine or happen together” -
Cambridge Dictionary (online version)
As per the above said definitions, the phrase ‘in conjunction with’ would mean…
“the fact of two or more things occurring/happened together or simultaneously”. Ac-
cordingly, in plain reading and understanding, the phrase or sentence viz. “sup-
plied in conjunction with each other” used in the definition of ‘Composite Supply’
under Section 2(30) of the CGST Act, 2017 would imply “occurrence or happening
of the two things or events namely supply of services and supply of goods together or
simultaneously..”. Therefore, in the light of scope of work read with terms & con-
ditions as provided in the Contract (including rate of payment), it is necessary to
examine whether the additives/chemicals supplied (on consumption basis) by the
Applicant are in conjunction with supply of services or not.
9.8 It is observed that for “Mud Engineering and Drilling Waste Man-
agement Services”, the scope of work was detailed under Section-II of the Con-
tract. The said scope of work consists of ‘deployment of personnel (mud coordinator.
Mud Engineer etc.) - Ref. : Clauses 11.1 to 11.3’, Technical support (clause-17), Labora-
GST LAW TIMES  13th August 2020  66