Page 161 - GSTL_3rd September 2020_Vol 40_Part 1

2020 ] IN RE : PRASA INFOCOM & POWER SOLUTIONS PVT. LTD. 95
5.2.2 As per Article V, the Agreement shall be effective as of the first
date stated in the Agreement and shall remain in effect for a period of one year,
and thereafter shall automatically renew for successive one year terms until ter-
minated under the terms mentioned in the Article V of the Agreement.
5.2.3 Article XXVII of the Agreement refers to ‘Exhibit 1’ and the said
Exhibit, signed by the applicant’s Director mentions the Scope of Work as includ-
ing Detailed Statement of Works Activities dated 25-4-2017 and Layouts of Data
Centre, UPS, DG Set, etc. Sr. No. 2 of the Exhibit mentions that if the applicant
fails to supply and install the necessary components required for Cray to install
its system then the applicant is liable for liquidated damages.
5.2.3.1 The detailed Statement of Works Activities is dated 24-4-2017
and therein the applicant, in a tabular form, has given separately, the costs of
goods supplied, the Installation Price and the AMC Fees for a three year period
along with VAT/CST/Service fax thereon. There is also an unexplained Buyback
cost mentioned which would presumably be in respect of the goods supplied by
the applicant to Cray. The total cost as per the statement dated 24-4-2017 is
Rs. 26,21,16,223/-, after a Buyback cost of Rs. 1 crore.
5.2.3.2 There is another detailed Statement of Works Activities dated
17-5-2017 and therein too, the applicant, in a tabular form, has given separately,
the costs of goods supplied, the Installation Price and the AMC Fees for a three-
year period along with VAT/CST/Service Tax thereon. There is again an unex-
plained Buyback cost mentioned which would presumably be in respect of the
goods supplied by the applicant to Cray. The total cost as per this Statement is
Rs. 34,60,95,168/-, after deduction of a Buyback cost of Rs. 1 crore. The value of
goods supplied is Rs. 26.03 (excluding taxes), the value of Civil and Mechanical
Work is Rs. 0.34 crores, the installation cost is Rs. 1.02 crores and the AMC cost
(post warranty) for a one year period and three year period is Rs. 0.86 crores and
Rs. 2.59 crores. There is a further cost shown against Onsite Resources for a peri-
od of 3 years totaling Rs. 2.01 crores.
5.2.3.3 It is therefore seen, as per the Exhibit that, the costing of goods
and services are shown separately and the major value of the contract exceeding
85% of the total cost of the project is pertaining to supply of goods.
5.3 The applicant has also submitted the Amendment dated 5-5-2017,
made to the Agreement mentioned at 5.3 above. While the amendment is dated
5-5-2017, it incorporates a Statement of Work in letter format dated much after
i.e. on 20-5-2017 and a Cost Summary dated 17-5-2017.
5.3.1 The Statement of Work mentioned in 5.3 above includes Design
approval for the complete data center, Supply of items, Installation of items,
Testing and commissioning of the installed equipment, Detailed documentation,
namely as built drawings, operational manuals, warranty and test certificates,
detailed hand over along with training to end customer and providing process
flow chart for maintaining all the equipment.
5.3.2 The Cost Summary mentioned in 5.3 above, against ‘Funds Flow’,
mentions that 40% advance to be paid to applicant for supply of large value
items and the balance against material readiness before delivery. For supply of
small value items, 100% amount to be paid against delivery and for installation
and commissioning, 100% to be paid on completion. The Cost summary does not
GST LAW TIMES  3rd September 2020  177