TMI Blog2020 (10) TMI 768X X X X Extracts X X X X X X X X Extracts X X X X ..... of building body on the chassis of the customer by the applicant is supply of services. The activity of body building undertaken on a truck chassis made available by a customer to the applicant amounts to supply of services as per Schedule II clause 3 of CGST Act 2017. - TN/27/AAR/2020 - - - Dated:- 12-5-2020 - MS. MANASA GANGOTRI KATA, I.R.S., AND THIRU KURINJI SELVAAN V.S., M.SC. (AGRI.), M.B.A., MEMBER, Note: Any appeal against the advance ruling order shall be filed before the Tamil Nadu State Appellate Authority for Advance Ruling, Chennai under Sub-section (1) of Section 100 of CGST ACT/TNGST Act 2017 within 30 days from the date on which the ruling sought to be appealed against is communicated. At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act. M/s. Tube Investments of India L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed directly by the vendor. The body building activity essentially entails the erection of cabin and load body. The process of building them is distinct and is detailed below: Cabin: When the vendor undertakes to build the cabin on the chassis, the same would involve a welding process. The erection of the cabin would involve welding and fabrication of the requisite raw material parts on the chassis in a step by step manner. Once the cabin is built on the chassis, the same is painted and the vendor will proceed to install necessary fitments which are required on the cabin's interior portion. Thus, the cabin is erected over the chassis by way of fabricating the parts on the latter in a brick by brick/plank by plank manner. It is not a case where the cabin is separately manufactured and merely mounted on the chassis. Load Body: In case of load bodies, the vendors erect a sub-frame/ mounting bracket over the chassis. These sub-frames form the base of the load body which will integrate the body with the chassis. For convenience, the erected sub-frames are then dismounted from the chassis and the body is built over the sub-frame. The purpose of erection of sub-fra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as stated that as they undertake to construct cabin and load bodies by way of erecting the same over the chassis, it can be said that the activities amount to treatment or process . Further, the treatment or process is performed on goods i.e. the chassis provided by the customers and also the ownership of the chassis vests with the customers during the process of body building. The applicant has stated that the concept of job work under the GST and erstwhile indirect tax are not identical but they are similar insofar, as it deals with carrying out an activity on the goods made available by the Principal, with the only difference being nature of activity undertaken is not restricted to result in manufacture. Accordingly, they have referred to the judgment issued in the erstwhile indirect regime viz Judgment of Apex Court in Prestige Engineering (India) Ltd [1994 (73) ELT 497 (SC)] = 1994 (9) TMI 66 - SUPREME COURT . They have also placed reliance on the judgment of the Hon ble Tribunal Delhi, in the case of Audi Automobiles [2010 (249) ELT 124 (Tri.Del.)] = 2009 (5) TMI 426 - CESTAT, NEW DELHI where the tribunal held that the activity of building a body on the automobile ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The state jurisdictional officer submitted the comments and they requested to verify the actual transaction at the premises of the applicant. The State jurisdictional authority on perusal of the place and documents furnished their comments vide their letter dated 17/09/2019 which is given below verbatim: i. The chassis were brought by the customer to TI Truck Body Works (Division of Tube Investments of India Ltd.,) ii. Then the customer approaches TI Truck Body works iii. On receipt of an order from customer vide TI Truck Body Works gets a quotation from their subcontractor [Tvl.N.S Rama Rao Body Works] iv. The Quotation was then served to the Customer v. On instruction of TI Truck Body works, the chassis were directly delivered to the sub-contractor (Tvl.N.S.Rama Rao Body Works) by the customer (E2E supply chain solutions Ltd.,) vi. On completion of work, the sub-contractor (Tvl. N.S.Rama Rao Body Works) raises delivery note to Tube Investments of India Ltd.,) vii. Then Tube investments of India Ltd., raises an invoice to final customer E2E supply chain solutions Ltd., along with body building certificate and Form 22-A as per Motor Vehicles Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate Tax and the State Tax officer, in the comments furnished has not mentioned about any pending proceedings. Also, the Central Tax Office did not furnish any comment. We consider that no proceedings are pending on the question raised by the applicant. The issue raised by the applicant is Whether the activity of body building undertaken on the chassis made available by a customer through their sub-contractor vendor amounts to supply of goods or supply of services. As the question is to determine the nature of supply, which is within the ambit of this authority, the same is taken up for decision. 6.1 In the instant case, it is seen that the customers procure the chassis and the same is delivered to the vendors of the applicants to erect body over the chassis on the specifications of the customer. The applicant on receipt of the Purchase Order for building the body on the chassis bought by the customer enters into agreement with third party vendors and sub contracts the entire activity of body building over the chassis to third party vendors as a back to back work. The inputs required for the works are procured directly by the third party vendors. The Purchase Order place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... From the above it is evident that the activity undertaken by the applicant for body building on the chassis provided by customer is to be classified as Job work under CGST/TNGST Act 2017 and as per Schedule II of CGST Act 2017, the said activity of building body on the chassis of the customer by the applicant is supply of services. 6.3 The above conclusion arrived at by us is in line with the clarification in Circular, No. 52/26/2018 - GST dated 09-08-2018, wherein the applicable GST on the bus body building activity is clarified as under: 12.1 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%. 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 fabricati ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
