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TMI Blog2019 (11) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... hly magazines. 3. The Applicant had sought advance ruling on classification of goods and services as under:- A. Whether the printed text books for PUC Board classifiable under HSN Code 4901 1010 supplied to resellers is exempt from the payment of CGST and SGST? B. What is the applicable rate of CGST and SGST on printing and binding of brochures, books, calendars, pamphlets on job work basis to the Government authority and other printers? C. What is the applicable rate of CGST and SGST on binding of diary, catalogues and books on job work basis? D. What is the applicable rate of CGST and SGST on printing and supply of text books and work books to the State Government for onward supply to schools? E. Whether the printing and supply of periodicals and magazines referred in HSN code 4901 exempt from payment of GST? 4. FACTS OF THE CASE 4.1 The first question relates to supply of printed text books for the PUC Board. In this context the applicant states that the Karnataka State Pre-University Board floated a tender for the printing of text books and the applicant participated in the tender and became the successful bidder. The PUC Board supplies the content on a DVD/CD whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rials including manpower and machines used in the binding belong to the applicant. Applicant submits that the activity of binding is done on a job-work basis and covered under clause (ii) of SI No.26 of Notification 11/2017-Central Tax(Rate) which is extracted as under. SI. No. Chapter, Section or Heading Description of Service Rate (%) Conditions 26 Heading 9988 (Manufacturing services on physical inputs (goods) owned by others (ii) services by way of any treatment or process on goods belonging to another person, in relation to (a) printing of newspapers; (b) printing of books (including Braille books), journals and periodicals. (c) Printing of all goods falling under chapter 48 or 49, which attract CGST @2.5% or Nil. 2.5 - The Applicant submits that as per Entry (ii) any process on goods belonging to another person which is carried out in relation to the activities referred to and more specifically in sub-clauses (b) and (c), is chargeable to a rate of 2.5% CGST. In the present case, the Applicant submits that activity of binding which is performed will be covered as services by way of process on goods belonging to another in relation to printing. 4.4. The next ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of GST. PERSONAL HEARING/PROCEEDINGS 6. The Applicant authorized Sri. Harish Bindumadhavan, Advocate and the said authorized representative appeared for personal hearing proceedings before this authority and made the following submissions. 6.1. The PUC Board supplies the content on a DVD/CD which is copyright protected for which royalty is paid by the applicant. The activity of printing and supply of the text books is covered under Notification 2/2017-Central Tax (Rate) under entry No. 119 reads as "Printed Books, including Braille Books" exempt from the payment of CGST. 6.2. The applicant undertakes printing of various items on the basis of content supplied by Government authorities and other Printers and paper is also supplied by the customer. The Applicant undertakes printing activity on a job work basis which is covered under (d) and (da) of entry (i) of the SI. No. 26 of Notification 11/2017-Central Tax (Rate) date 28.06.2017 which attracts tax @ 2.5% CGST and 2.5% SGST. 6.3 The Applicant undertakes the activity of binding of Diary, Catalogues and Books, supplied by the Customers including Government departments. The activity of binding is done on a job-work basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entry No. 119 reads as "Printed Books, including Braille Books." This is exempt from the payment of CGST and SGST. 9. The applicant undertakes printing of and binding of brochures, books, calendars, pamphlets, on job work basis on the basis of content and paper supplied by Government authorities and other Printers whereas ink, plates, machines and manpower belongs to the Applicant. In this regard CBEC has issued Circular no. 11/11/2017- GST dated 20.10.2017, where in it is clarified as under:- "It is clarified that supply of books, pamphlets, brochures, envelopes, annual reports, leaflets, cartons, boxes etc. printed with logo, design, name, address or other contents 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 of what constitutes the principal supply. In the case of printing of books, pamphlets, brochures, annual reports, and the like, where only content is supplied by the publisher or the person who owns the usage rights to the intangible inputs while the physical inputs including paper used for printing belong to the printer, supply of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts to supply of service and printing or any work in relation to printing is not involved. Hence this job work is covered under clause (iv) of entry no. 26 of Notification 11 /2017-Central Tax(Rate) inserted vide notification no. 1/2018 Central Tax (rate) Dated 25/01/2018 which is extracted as under.- (iv) Manufacturing services on physical inputs (goods) owned by others, other than (i), (ia), (ii), (iia) and (iii) above attracts CGST @ 9% and SGST @ 9%. Therefore the activity of binding of diary, catalogues and books carried out by the applicant on job work basis attracts CGST @9% and SGST @9%. 11. The Applicant prints the textbooks and workbooks on the basis of content supplied by the Government School Board / PUC Board and paper, ink chemicals, machinery all belong to the applicant. Once the Text books and Work books are printed by the Applicant, the books are thereafter supplied/ delivered to Taluk offices of the State Government across the state for onward supply to schools. As the content is supplied by the recipient of supply the activity carried out by the applicant amounts to supply of service. This activity of the applicant, is therefore, covered under the clause (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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