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2020 (3) TMI 241 - AAR - GSTClassification of supply - supply of goods or supply of services - rate of GST - activity of Zinc Platting for customers in Automobile, General Engineering and Electrical & Electronic Industries - HELD THAT:- The applicants are undertaking the work of electroplating the components of automobiles, etc., provided by the customers as per their specifications made in the diagram. For doing the electroplating, they purchase metals such as Zinc Ingot, Silver Bullion, Nickel, Copper, Chemicals., Hydrochloric and Nitric Acid, SC casting. The customers send the components under Delivery challan with the reason for Transport as ‘Outward-Job-work’ in the E-Way bill to the applicant. After doing Electroplating as per the specifications of the customer, the applicant raises invoice charging applicable GST and return the components stating ‘outward supply’ in the E-way bills. The components are owned by the applicants’ customers and are sent to the applicant for electroplating and return back. The final product is also owned by the applicants’ supplier - the supply of the applicant is that of ‘Supply of Service’. Classification of the service - HELD THAT:- SAC 9988 as per the Explanatory notes, covers those services characterized as outsourced portions of a manufacturing process - In the case at hand, the electroplating job done by the applicant is a portion of manufacturing process of the customer of the applicant and therefore, the activity of the applicant is covered under SAC 9988. Thus the activity of undertaking manufacturing services by a registered person on the physical inputs owned by another registered person is a ‘job work’. In the case at hand, the applicant is a registered person and when he undertakes electroplating activities on the goods belonging to another registered person, then the nature of work of the applicant is ‘Job work”. Rate of GST - HELD THAT:- The applicable rate of tax from 30.09.2019, is given vide entry 26(id) of Notification No. 11/2017-C.T.(Rate) as amended by Notification No. 20/2019-C.T.(Rate) dated 30.09.2019, which is @ 6% CGST in cases when the goods are owned by another Registered person as in such cases the applicant supply engineering services as job-work and the applicable rate of tax in cases when the goods are owned by unregistered persons continues @9% CGST as per Si.No. 26(iv) of Notification No. 11/2017-C.T.(Rate) dated 28.06.2017 as amended.
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