Page 167 - GSTL_20th August 2020_Vol 39_Part 3

2020 ] IN RE : V.E. COMMERCIAL VEHICLES LIMITED 381
chassis and asks applicant to fabricate the Bus body on chassis
owned by him. The chassis and body will continue to be owned by
customer who has provided the chassis for body fabrication after
body fabrication.
(ii) The chassis manufactured by Vehicle assembly plant is sold to its
dealer. The dealer has further sold it to customer and the customer
is approaching applicant for fabrication of body. While sending the
chassis to applicant, the customer owns the chassis and asks appli-
cant to fabricate the Bus body on chassis owned by him. The chassis
and body will continue to be owned by customer who has provided
the chassis for body fabrication after body fabrication.
(iii) The chassis manufactured by Vehicle assembly plant is sold to its
dealer. The dealer is approaching applicant for fabrication of body.
While sending the chassis to applicant, the customer owns the chas-
sis and asks applicant to fabricate the Bus body on chassis owned by
him. The chassis and body will continue to be owned by dealer who
has provided the chassis for body fabrication after body fabrication.
Apart from this the applicant will continue to receive the chassis
from Vehicle manufacturing plant as being done currently and sup-
ply the complete Bus charging 28% GST.
6.1.3 Applicant understands that in the situations described in above
Para, the chassis is owned by person desirous to get the body fabricated and ap-
plicant is not owner of chassis. The chassis owner has full liberty to go to any
body builder for getting the body fabrication work carried out. The applicant is
one of the choices for owner of chassis to get the body fabrication.
6.1.4 Applicant understands that such situations are covered under the
Circular No. 52/26/2018-GST, dated 9-8-2018. The relevant para of circular is
reproduced below.
“12.1 Applicable GST rate for bus body building activity : Representa-
tions have been received seeking clarifications on GST rates on the activity
of bus body building. The doubts have arisen on account of the fact that
while GST applicable on job work services is 18%, the supply of motor ve-
hicles attracts GST @ 28%.
12.2 Buses [motor vehicles for the transport of ten or more persons, in-
cluding the driver] fall under headings 8702 and attract 28% GST. Further,
chassis fitted with engines [8705] and whole bodies (including cabs) for
buses [8707] also attract 28% GST. In this context, it is mentioned that the
services of bus body fabrication on job work basis attracts 18% GST on such
service. Thus, fabrication of buses may involve the following two situa-
tions :
(a) Bus body builder builds a bus, working on the chassis owned
by him and supplies the built-up bus to the customer, and
charges the customer for the value of the bus.
(b) Bus body builder builds body on chassis provided by the
principal for body building, and charges fabrication charges
(including certain material that was consumed during the pro-
cess of job work).
12.3 In the above context, it is hereby clarified that in case as mentioned at
Para 12.2(a) above, the supply made is that of bus, and accordingly supply
would attract GST @ 28%. In the case as mentioned at Para 12.2(b) above,
fabrication of body on chassis provided by the principal (not on account of
body builder), the supply would merit classification as service, and 18%
GST as applicable will be charged accordingly.”

GST LAW TIMES  20th August 2020  167