9911796707
TMI Blog2020 (7) TMI 480X X X X Extracts X X X X X X X X Extracts X X X X ..... rposes of this Advance Ruling, a reference to such a similar provision under the CGST or MP GST Act would be mentioned as being under the GST Act. 3. BRIEF FACTS OF THE CASE: 3.1 The applicant is engages in the various business including manufacturing of Chassis Trucks & Buses, Engines, Bus body and automotive components. The applicant has different manufacturing units/manufacturing verticals in the State of Madhya Pradesh registered separately under the GST Act. Relevant details are as under:- Particulars GST Registration No. Location of the unit Manufacturing Chassis for Buses along with other products, 23AABCE9378F3ZI Sector - I, Pithampur Engaged in fabrication of body on chassis 23AABCE9378F1ZK Village Baggad (Dist-Dhar) distance from Pithampur unit 10 K.m. 3.2 When the body Fabrication is completed at the applicant's fabrication unit (GST no 23AABCE9378F1ZK) and the built up vehicle is sold , GST is collected and deposited @ 28% as a composite sale of bus under HSN 87021022 by claiming input tax credit of GST paid on various raw material. 3.3 Some customers after having purchased the vehicle from our manufacturing unit in chassis from, approach the applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28% GST upon which the dealer further sales to end customer charging GST @ 28%. End customer takes the vehicle to a body builder of his choice. The body builder fabricates the body on chassis so provided and supplies the body charging 18% GST as job work, in terms of Circular No. 52/26/2018-GST dated 9th August, 2018 or (b) Stock transferred to a depot and then sold in chassis form to the dealer at 28% GST upon which the dealer appoints an independent bus body builder to fabricate the body; the body builder supplies the body to Dealer and dealer sales the complete Bus its customer. or (c) Sent to the Bus Body Plant after paying GST @ 28% for fabrication of the bus body, The Bus plants avails input credit of GST paid on Chassis, fabricates the body on chassis and after that the complete bus is sold/supplied to the dealer/customer /Depot at 28% GST. 6.1.1 Currently the Bus Body plant is manufacturing Bus Bodies owned by VECV only. Now some of our customers / dealers have approached the applicant to fabricate bodies on chassis being purchased by them from dealers of VECV and also on chassis purchased by them by other chassis manufacturers. 6.1.2 There could be following scenario ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ob work services is 18%, the supply of motor vehicles attracts GST @ 28%. 12.2 Buses [motor vehicles for the transport of ten or more persons, including the driver] fall under headings 8702 and attract 28% GST. Further, chassis fitted with engines [8705] and whole bodies (including cabs) for buses [8707] also attract 28% GST. In this context, it is mentioned that the services of bus body fabrication on job work basis attracts 18% GST on such service. Thus, fabrication of buses may involve the following two situations: a) Bus body builder builds a bus, working on the chassis owned by him and supplies the built-up bus to the customer, and charges the customer for the value of the bus. b) Bus body builder builds body on chassis provided by the principal for body building, and charges fabrication charges (including certain material that was consumed during the process of job-work). 12.3 In the above context, it is hereby clarified that in case as mentioned at Para 12.2(a) above, the supply made is that of bus, and accordingly supply would attract GST @28%. In the case as mentioned at Para 12.2(b) above, fabrication of body on chassis provided by the principal (not on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fabrication / mounting work is separate supply than supply of chassis manufactured by one of the unit of applicant. 6.2.4 As per the term defined u/s 2(68) of the CGST Act and as per para 3 of the schedule II of the CGST Act "any treatment or process which is applied to goods of another persons is a supply of service. 6.2.5 As per Sec. 2(68) of the CGST Act/ SGST Act. The term job worker means" "any treatment or process under taken by a persons on goods belonging to another registered persons and the expression job worker shall be construed accordingly". 6.2.6 The Motor Vehicle is not complete without a body. A chassis is semi finished goods and any treatment done by any other party on the chassis is the activity of job work. Therefore it is supply of service and covered under HSN-9988 which attracts tax 18 %GST. 6.2.7 The ownership of chassis always remains with the customer who has given chassis to applicant for building and mounting of body on job work. Because it fulfils the main important condition of the definition of job work i.e. process undertaken on goods belonging to another registered persons. The whole process of body building and mounting is performed on the good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... venue dated 9th August, 2018. 7.4 The following Para's of the above mentioned circular the issue has been dealt with which are as follow - 1. Applicable GST rate for bus body building activity: Representations have been received seeking clarifications on GST rates on the activity of bus body building. The doubts have arisen on account of the fact that while GST applicable on job work services is 18%, the supply of motor vehicles attracts GST @ 28%. 2. Fabrication of body may involve the following two situations: a) A vehicle body builder builds a vehicle, working on the chassis owned by him and supplies the built-up vehicle to the customer, and charges the customer for the value of the bus. In this scenario the chassis is being manufactured by the one of the unit of applicant registered separately as distinct person under GST Act and Sold to provider of chassis before receiving the chassis for fabrication of body. In this situation, as per facts and information produced, the ownership of chassis is transferred by one unit of applicant to the customer and then customer provides such chassis to the applicant for mounting/ fabrication of bodies on it. As the customer is tak ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
