TMI Blog2023 (7) TMI 522X X X X Extracts X X X X X X X X Extracts X X X X ..... the body. Thus, it is evident that the applicant is fabricating the body on the chassis belonging to the customer - the applicant is fabricating the body on the chassis belonging to another person and hence the activity is squarely covered under Para 3 of Schedule II of the CGST Act, 2017 as a treatment or process (which is applied to another person's goods and accordingly is a supply of services. Classification of the activity and the rate of GST applicable - HELD THAT:- The value of the services in this heading is based on the service fee paid, not the value of the goods manufactured. SAC-99888 under Heading 9988 pertains to Transport equipment manufacturing services and Sub-Heading 998881 pertains to the Motor vehicle and trailer manufacturing services. Therefore, the activity of the applicant as discussed above is appropriately classifiable Under Service Accounting Code 998881. Classification and applicable rate of tax for the activity of accident repairing job on a lump sum price basis including the cost of material and labour - HELD THAT:- As per Heading 998714, the repair and maintenance services may be paid by the owner of the goods being repaired or by a warr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing job on the vehicle supplied by the owner for such job if a lump sum price is charged that includes the cost of material and labour? 4. Contentions of the Applicant: 4.1. The applicant submitted that customers purchase chassis and hand over them for fabricating the body. The applicants are providing the service of bodybuilding on motor vehicles by fabrication and charging fabrication charges on a lump sum basis. Providing manufacturing services or body building services on physical inputs (goods) or chassis owned by others and provided by the owner for body building and the applicant charges lump-sum fabrication charges (including certain material that would be consumed during the process of body building). The applicant carrying out this activity of manufacturing tippers, tankers, trailers, buses, etc. on chassis provided by the owners of such vehicles. The process of said manufacturing activity is as: (i) receiving chassis at a workshop; (ii) purchasing raw steel and receiving it at the workshop; (iii) preparing a cutting plan and drawing; (iv) cutting and bending raw material; (v) welding of all cutting and bending part; (vi) assembly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... follows:- 4.5. Advance Ruling No. GOA/GAAR/1 of 2017-2018/2018-19/1929, dtd. 21/08/2018 in RE: AUTOMOBILE CORPORATION OF GOA LIMITED, wherein it is held that Activity of building and mounting of the body on chassis provided by the principal under FOC challan results in the supply of services under HSN 9988 and hence, taxable @ 18% GST . 4.6. Advance Ruling No. KER/39/2019, dtd.02/03/2019 in RE: KONDODY AUTO CRAFT (INDIA) PVT. LTD., wherein it is held that Activity of bus body building on job work basis, on the chassis supplied by the customer, is a supply of service covered under sac Code 9988 and thereby attract 18% GST'. 4.7. Order No. 03/2019, dtd. 10/04/2019 in case No. 02/2019 IN RE: ROHAN COACH BUILDER wherein it is held that Fabrication of bus body on chassis supplied by OEMs/principal on delivery challan or any other owner of chassis by collecting job work charges including inputs required for such fabrication work with no transfer of ownership of chassis by a principal to job worker - applicant, a job worker, supply classifiable under SAC 998881 as Motor vehicle and trailer manufacturing services and taxable under Serial No. 26(ii) as Manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... granted an opportunity for a personal hearing on 05/07/2022. Adv. Alan V. Dev represented the applicant. The counsel reiterated the contentions made in the application and requested to issue a ruling based on the submissions made in the application. 7. Discussion and Finding: 7.1. The matter was examined in detail. The application is admissible Under section 97 of the CGST Act. The applicant is providing services of bodybuilding of commercial vehicles used for carrying goods on the chassis supplied by the customers. The body is built as per the requirement of the customers. The main issue to be determined is whether the activity constitutes the supply of services or a supply of goods. 7.2. As per Para 3 of Schedule II of the CGST Act, 2017 which lists out the activities or transactions to be treated as supply of goods or supply of Services; any treatment or process which is applied to another person's goods is a supply of service. In the instant case, the applicant is building the body of commercial vehicles for carrying goods on the chassis supplied by the customer as per the specifications of the customer. The applicant is collecting the charges for the activity wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s body building shall include the building of body on chassis of any vehicle falling under chapter 87 in the First Schedule to the Customs Tariff Act, 1975 of Notification No. 11/2017 Central Tax (Rats) dated 28/06/2017. 7.5. Regarding the classification and applicable rate of tax for the activity of accident repairing job on a lump sum price basis including the cost of material and labour, the Explanatory Notes, to the. Scheme of Classification of Services under Heading 998714 - Maintenance and repair of transport machinery and equipment reads as follows; This Service Code includes i. maintenance and repair services of motor vehicles like cars, tracks, vans, and buses, involving engine overhaul, motor tune-up, fuel system repair and adjustment, steering gear repair and adjustment, suspension repair, brake repair and adjustment, transmission repair and adjustment, exhaust system repair, cooling system repair including water hose replacement and other maintenance and repair; ii. scheduled factory-recommended and preventative maintenance inspection services; iii. electrical system repair and battery charging services for motor iv. puncture repair services, whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... others - Services by way of job work in relation to bus body building; of Notification No. 11/2017 Central Tax (Rate) dated 28/06/2017. Question 3. What will be the service code (tariff) for the above-stated activity of body building carried out on another person's chassis of motor vehicle? Ruling : The activity of body building carried out on the chassis of motor vehicle owned by others is classifiable under SAC 9988. Question 4. If the above-stated activity of body building is not considered as supply of services, what will be the nature of this supply, tariff code and rate of GST for such supply? Ruling : Not relevant in view of the answer, to Qn. No. 1,2 and 3 above. Question 5. What would be the classification and applicable rate of tax for the activity of accident repairing job on the vehicle supplied by the owner for such job if a lump sum price is charged that includes the cost of material and labour? Ruling . The activity of accident repairing job on lumpsum price including the cost of material and labour of the vehicle supplied by the owner is appropriately classifiable under SAC 998714 and is liable to GST at the rate of 18 % [9% CGST + 9% ..... X X X X Extracts X X X X X X X X Extracts X X X X
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