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TMI Blog2023 (7) TMI 522X X X X Extracts X X X X X X X X Extracts X X X X ..... processes carried out on chassis of motor vehicles owned by others is a supply of service? 3.2. If the above-stated activity of bodybuilding is considered as a supply of service in terms of the description given in paragraph 3 of Schedule II of the CGST Act, 2017 what will be the rate of GST applicable on such service? 3.3. What will be the service code (tariff) for the above-stated activity of bodybuilding carried out on another person's chassis of the motor vehicle? 3.4. If the above-stated activity of bodybuilding is not considered as a supply of services, what will be the nature of this supply, tariff code, and rate of GST for such supply? 3.5. What would be the classification and applicable rate of tax for the activity of an 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? 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 manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ody on chassis provided by the principal (not on account of a body builder), supply would merit classification as service, and 18% GST as applicable will be charged accordingly. 4.3. Service accounting code 9988 covers manufacturing services on physical inputs (goods) owned by others. Thus it appears that the nature of the activity of bodybuilding and mounting of the body on the chassis provided by the principal will result in the supply of service under HSN code 9988 and hence should be taxed at 18% of GST. 4.4. Further the advance ruling given by various state authority on a situation similar to ours states that the service provided comes under SAC 9988 and thereby attract 18% GST. All such rulings are summarized as 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 "Activi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omer by raising the invoice of the value of the motor vehicle, it would amount to the supply of goods. The activity of bodybuilding carried out on another person's chassis of the motor vehicle is classifiable under SAC 9988. 5. Remarks of the Jurisdictional Officer: The application was forwarded to the jurisdictional officer as per provisions of Section 98(1) of the CGST Act. The jurisdictional officer submitted that the questions raised in the advance ruling application filed by M/s. M/s. Aromal Autocraft (GSTIN-32BTAPA8613F2ZA) is not pending /decided in this office in any proceedings under any provisions of the Act. 6. Personal Hearing: The applicant was 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. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. 7.4. Accordingly, the activity is liable to GST at the rate of 18% [9% CGST + 9% SGST] as per entry at SI No. 26 (ic) - 9988 - "Manufacturing services on physical inputs (goods) owned by others - - Services by way of job work in relation to bus body building; Explanation - For the purposes of this entry, the term "bus 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 eq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed out on the chassis of motor vehicle owned by others is supply of service? Ruling: The activity of bodybuilding of motor vehicle on the chassis, supplied by the customer is a supply of services. Question 2. If the above stated activity of body building is considered as supply of service in terms of description given at paragraph 3 of Schedule II of the CGST Act, 2017 what will be the rate of GST applicable on such service? Ruling: The activity is liable to GST at the; rate of 18% [9% CGST + 9% SGST] as per entry at SI. No. 26 (ic) - 9988 - "Manufacturing services on physical inputs (goods) owned by 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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