GST on transportation service provided in contract of integration of transmission towers : AAR

GST on transportation service provided in contract of integration of transmission towers : AAR | Authority of Advance Ruling West Bengal in matter of Skipper Ltd. ruled out that GST on transportation service provided in contract of integration of transmission towers would be considered as a works contract service and therefore not eligible forexemption under serial no. 18 of Notification No. 12/2017-Central Tax (Rate) dated 28/06/2017.

GST on transportation service provided in contract of integration of transmission towers : AAR

The extract of the ruling is given below: 13. The contract for the Tower Package as above, being works contract is service in terms of paragraph 6(a) to Schedule II to the GST Act. Activities covered under Schedule II are to be treated as a supply of the nature described under section 7(1)(d) of the GST Act. Reference to Circular No. 47/21/2018-GST dated 08/06/2018 of CBIC or the e-flyer is, therefore, not relevant in the present context. The price components of both the First and the Second Contracts, including that for transportation, in-transit insurance etc. are, therefore, to be clubbed together to arrive at the value of the supply of works contract service as discussed above. Transportation of goods and in-transit insurance, being merely parts of the bundled services, should to be treated as components of the value of the works contract and not as separate and independent supplies. The exemption under serial no. 18 of the Exemption Notification is, therefore, not applicable in the present context. In view of the foregoing, we rule as under

RULING

The Applicant supplies works contract service, the value of which includes inter alia consideration paid for transportation and in-transit insurance. GST is to be paid on the entire value of the works contract, including the supply of materials, transportation, in- transit insurance, erection, commissioning etc. The exemption under serial no. 18 of Notification No. 12/2017-Central Tax (Rate) dated 28/06/2017 is, therefore, not applicable in the present context. This Ruling is valid subject to the provisions under Section 103 until and unless declared void under Section 104(1) of the GST Act. Click here to download the ruling

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