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2020 ] IN RE : PRASA INFOCOM & POWER SOLUTIONS PVT. LTD. 97
rendered the prices are shown excluding Service Tax. The Statement of Works
Activities dated 17-5-2017 has clearly bifurcated the contract into a supply of
goods and supply of services. Further, Amendment dated 5-5-2017, made to the
Agreement dated 4-4-2017 incorporates a Cost Summary dated 17-5-2017, which,
against ‘Funds Flow’, envisages separate payment for supply of works and for
supply of materials/equipment. There appears to be a clear bifurcation, in the
subject Agreement and other documents submitted by the applicant, with respect
to supply of goods and supply of services.
5.5.3 Thus, from all the documents submitted by the applicant we find
that the agreement is considering a clear demarcation of goods and services to be
provided by the applicant but such supplies are naturally bundled and in con-
junction with each other. Hence we now refer to the definition of ‘Composite
Supply’ as mentioned in sub-section (30) of Section 2 of CGST Act, 2017 and
which is as under :-
‘Composite supply means a supply made by a taxable person to a recipient
consisting of two or more taxable supplies of goods or services or both, or
any combination thereof which are naturally bundled and supplied in con-
junction with each other in the ordinary course of business, one of which is
a principal supply’.
5.5.4 From the discussions made above we find that, as per the subject
agreement and documents submitted by the applicant, the major part of the con-
tract is supply of goods. These goods are sold to the client by the applicant and
they receive separate payment for such goods sold. Further we find that the
goods that are supplied are used by the applicant to provide services of installa-
tion, testing and commissioning of the Data Centre. Without these goods the ser-
vices cannot be supplied by the applicant and therefore we find that the goods
and services are supplied as a combination and in conjunction and in the course
of their business where the principal supply is supply of goods. Thus we find
that there is a composite supply in the subject case but there is no building, con-
struction, fabrication, completion, erection, installation, fitting out, improvement,
modification, repair maintenance, renovation, alteration or commissioning of any
immovable property wherein transfer of property in goods (whether as goods or in
some other form) is involved in the execution of the contract. Therefore there is
no works contract involved in the subject case.
5.6 Further, with respect to the claim of applicant that subject supply is
classifiable under Chapter 9954 (Construction Services) and falls under descrip-
tion of services - (ii) Composite supply of works contract as defined in clause
(119) of Section 2 of CGST Act, 2017 it is to state that only those supply is classifi-
able under Chapter 9954 which are mainly related to the construction service. In
this case, it is found that there is absolutely no construction of any kind. The Data
Centre, as per the submissions made, appears to be a space/room where the
equipment/machinery/other various apparatus arc installed. The value of Civil
Construction shown is insignificant, as compared to the value of goods/services.
The major portion in this project is of sale of equipment/Machinery/other vari-
ous apparatus.
5.7 The jurisdictional officer has submitted that the Applicant, under
letter dated 8-11-2019 has intimated that the works with respect to construction
and commissioning of the service in relation to the said contract has been com-
GST LAW TIMES  3rd September 2020  179