Ankita Khetan | Oct 20, 2017 |
Clarification on taxability of printing contracts
F. No. 354/263/2017-TRU
Government of India
Ministry of Finance
Department of Revenue
Tax research Unit
****
North Block, New Delhi
20th October 2017
To,
The Principal Chief Commissioners/Chief Commissioners/ Principal Commissioners/Commissioner of Central Tax (All) /
The Principal Director Generals/ Director Generals (All)
Madam/Sir,
Subject: Clarification on taxability of printing contracts
Requests have been received to clarify whether supply of books, pamphlets, brochures,envelopes, annual reports, leaflets, cartons, boxes etc., printed with design, logo, name, addressor other contents supplied by the recipient of such supplies, would constitute supply of goodsfalling under Chapter 48 or 49 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975)or supply of services falling under heading 9989 of the scheme of classification of servicesannexed to notification No. 11/2017-CT(R).
2. In the above context, it is clarified that supply of books, pamphlets, brochures, envelopes,annual reports, leaflets, cartons, boxes etc. printed with logo, design, name, address or othercontents supplied by the recipient of such printed goods, are composite supplies and the question,whether such supplies constitute supply of goods or services would be determined on the basis ofwhat constitutes the principal supply.
3. Principal supply has been defined in Section 2(90) of the Central Goods and Services TaxAct as supply of goods or services which constitutes the predominant element of a compositesupply and to which any other supply forming part of that composite supply is ancillary.
4. In the case of printing of books, pamphlets, brochures, annual reports, and the like, whereonly content is supplied by the publisher or the person who owns the usage rights to theintangible inputs while the physical inputs including paper used for printing belong to the printer,supply of printing [of the content supplied by the recipient of supply] is the principal supply andtherefore such supplies would constitute supply of service falling under heading 9989 of the
scheme of classification of services.
5. In case of supply of printed envelopes, letter cards, printed boxes, tissues, napkins, wallpaper etc. falling under Chapter 48 or 49, printed with design, logo etc. supplied by the recipientof goods but made using physical inputs including paper belonging to the printer, predominantsupply is that of goods and the supply of printing of the content [supplied by the recipient ofsupply] is ancillary to the principal supply of goods and therefore such supplies would constitutesupply of goods falling under respective headings of Chapter 48 or 49 of the Customs Tariff.
4. Difficulty if any, in the implementation of the circular should be brought to the notice ofthe Board. Hindi version would follow.
Yours Faithfully,
Rachna
Technical Officer (TRU)
Email: [email protected]
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