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TMI Blog2020 (7) TMI 475X X X X Extracts X X X X X X X X Extracts X X X X ..... ference to such a similar provision under the CGST Act or MP GST Act would be mentioned as being under the GST Act. 3. BRIEF FACTS OF THE CASE 3.1 The applicant is registered under the provisions of GST law in the State of Madhya Pradesh, vide GSTIN: 23AAACM1924E1Z3 and the principal place of business is in Indore with the production facility at Pithampur. 3.2 The Executive Engineer, Construction Division-2, Capital Production Administration (CPA), Bhopal - a Department of Government of Madhya Pradesh, floated a tender reference No. CPA/Tender No.2402 for supply, installation and fixing of customized furniture, as detailed below for newly constructed Mantralaya, Vallabh Bhawan Extension, Bhopal. (a) Main Table + ERU (b) Back Runner for Minister (c) Minister Room Corner Table (d) Conference Room Table (e) Dining Table & Chair (f) Conference Room 3 seater sofa (g) Back Runner units (h) Meeting Room Table (i) Meeting Hall table etc. 3.3 The Executive Engineer, CPA, Bhopal has- issued to the applicant company the contract No.12/DL 18-19/Work order No. 1941/SAC/C-II/18 dated, 02.05.2018. 3.4 The invoices were issued by the applicant charging therein tax @18% consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nation - For the purposes of this item, the term "business" shall not include any activity or transaction undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities. The phrase "original works" has not been defined under the provisions of GST law. The said phrase "original works" has been frequently used with regard to construction services under head 9954 in the Notification No.11/2017-Central Tax(Rate) dated, 28.06.2017 and Notification No.12/2017-Central Tax (Rate) dated, 28.06.2017 exempting specific construction services of heading 9954. The said term has been defined under Explanation 1 (zs) of Notification No.12/2017-Central Tax (Rate) dated, 28.06.2017, which reads as under:- "(zs) "original works" means - all new constructions; (i) all types of additions and alterations to abandoned or damaged structures on land that are required to make them workable. (ii) erection, commissioning or installation of plant, machinery or equipment or structures, whether pre-fabricated or otherwise". 5.4 Section 2(119) of CGST Act provides "works contract" means a contract for building, construction, fabrication, com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a mixed supply shall be determined in the following manner, namely - (a) a composite supply comprising two or more supplies, one of which is a principal supply, shall be treated as a supply of such principal supply, (b) ...................................... 5.11 As per section 10(1)(d) of IGST Act, the place of supply of goods, other than supply of goods imported into or exported from India, shall be as under:- "(d) where the goods are assembled or installed at site, the place of supply shall be the place of such installation or assembly". 5.12 As per the interpretation of law and the facts of the case, the supply, installation, fixing of customized furniture for newly constructed Mantralaya, Bhopal is composite supply of goods within the meaning of section 2(30) and 8(a) of CGST Act, where the supply of furniture is a principal supply and installation/ fixing thereof is ancillary supply. The rate of tax of principal supply will be applicable to composite supply. The supply of furniture, which may or may not be customized is principal supply where the rate of tax is 18% (9% CGST & 9% SGST) as per Sl.No.438 of Schedule III of CGST Act under HSN 9403 with effect from 15.11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and fixing of furniture cannot be covered under works contract, as it does not result in immovable property or it is not going to be part of immovable property. 5.18 As per SI.No.3(vi) of Notification No.11/2017-Central Tax (Rate), composite supply of works contract as defined u/s 2(119) of CGST Act, provided to the Central Government, State Government etc by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation or alteration of a civil structure or any other original works meant predominately for use other than for commerce, industry, or any other business or profession covered under heading 9954 are chargeable to tax @12% (CGST 6% & SGST 6%). The heading 9954 does not include the supply, installation or fixing of furniture customized or not customized in a building. 5.19 Sl. No.3(vi) of Notification No.11/2017-Central Tax (Rate) deals with composite supply of works contract of a civil structure or any other original works meant predominately for use other than for commerce, industry, or any other business or profession. It is evident that the composite supply of works contract of a civil structure must result in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e admit the application for consideration. 6.3 The applicant dealing in wide range of office furniture and automation products is registered under the GST Act, 2017. The applicant is carrying on the business as manufacturer, marketers, exporters, importers, and distributors in all kinds of office equipment. The goods dealt by the applicant are classifiable under Chapter 94 of the first Schedule to Customs Tariff Act, 1975, which has been adopted in the GST regime as GST Tariff. 6.4 Section 2(119) of CGST Act provides "works contract" means a contract for building, construction, 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 such contract. 6.5 As per Annexure - Scheme of Classification of services to Notification No.11/2017-Central Tax (Rate) dated. 28.06.2017, works contract services has been classified as "construction service (under heading 9954, which includes the following groups; Group Service description 99541 Construction services o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pply, installation and fixing of furniture, either customized or not customized, is not composite supply of works contract by way of construction etc of civil structure or other original works to the Government .and therefore, is not chargeable to concessional rate of 12% as per the Notification No.11/2017 dated, 28.06.2017. 6.12 Having regard to our observations and findings detailed in the foregoing paras, we conclude that the contract in questions i.e. work order relating to supply, installation and fixing of customized furniture in a building conform to the "COMPOSITE SUPPLY" as provided in section 2(30) of CGST Act, 2017. The supply made by the applicant to the Capital Project Administration consists of Two taxable supplies of Goods and Services, which are naturally bundled and supplied in conjunction with each others, where the supply of goods viz. Furniture is the principal supply. We thus hold that the work order in question shall merit classification under Chapter Head 9403 of GST Tariff and shall be liable to GST at the rate applicable at the time of supply. 7. RULING (Under Section 98 of Central Goods and Services Tax Act, 2017 and the Madhya Pradesh Goods and Service ..... X X X X Extracts X X X X X X X X Extracts X X X X
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