TMI Blog2023 (9) TMI 854X X X X Extracts X X X X X X X X Extracts X X X X ..... to be made, whether in money or otherwise in respect of, in response to or for the inducement of the supply of goods or services or both, whether by the recipient or by any other person but shall not include any subsidy given the Central Government or a State Government. The Authority for Advance Ruling is correct in holding that value of material and cost of execution of work for installation of lines will be included in the value of supply for determination of taxable value under GST where all such cost are taken as reimbursement. Entire cost is borne by the recipient of service - HELD THAT:- The Authority for Advance Ruling has held that the value of taxable supply shall not include the material cost and the appellant shall be liable to pay GST on supervision charge only to avoid double taxation subject to the condition that tire contractor/recipient of service should have GST invoice which should be submitted after completion of project - it is found that that there is no such provision stipulated under GST Act and this condition is unwarranted and having no legal backing as argued by the appellant. Thus, where the value of materials and cost of execution of work for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. One is where entire material and installation work is arranged by the appellant on behalf of the customers in the supervision of the appellant. The appellant claims for reimbursement of material cost and installation expenses incurred on behalf of the customer which is later reimbursed to the them by the customer on cost to cost basis and the net income charged by the appellant is supervision fee only. In the second mode the entire work with material are arranged by customers and installation work is done by the contractors hired by the customers. In this case the role of the appellant is limited to supervision only for which the appellant charges supervision fee. 5. In the aforesaid backdrop the appellant filed an application before the Authority for Advance Ruling seeking clarification on following questions- (a) Whether in the given facts and circumstances the value of material and cost of execution of work for installation of lines will be included in the value of supply for determination of taxable value under GST where all such cost are taken as reimbursement while our supply is supervision only? (b) Whether in the given facts and circumstances the value of mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t/contractor should have GST invoice of material and the same should be submitted to the appellant after completion of project. Thus the Authority for Advance Ruling has made the order conditional which is completely unwarranted and not supported by any legal provision of law. 8.5 The Authority for Advance Ruling has failed to appreciate the fact that the liability for payment of GST by the Appellant cannot be dependent upon the nature of invoice obtained by the customer from the vendor. 8.6 In appellant's understanding in the 2nd mode of execution of deposit work, price is not the sole consideration, as the handover of infrastructural facility so created under deposit work by the consumer/customer, to the appellant is the non-monetary consideration to the appellant since its benefit will accrue to the appellant. 8.7 The appellant submits that in the present case the value of supply of goods or service cannot be determined under Section 15(1) of CGST Act, 2017 as the price is not the sole consideration. 8.8 The appellant submits that in the present case the nonmonetary consideration received by the appellant in the form of infrastructural work/facility carried out b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruling held that in second mode where entire work with materials are arranged by customers and installation work is done by the contractors hired by the customers, the value of taxable supply shall not include the material cost and the appellant shall be liable to pay GST on supervision charge only to avoid double taxation subject to the condition that the contractor/recipient of service should have GST invoice which should be submitted after completion of project. 9.4 We find that the appellant is aggrieved with the ruling given by the Authority for Advance Ruling on point (b) regarding insertion of specified condition of GST invoice by the service recipient. We find that there is no such provision is GST Act, which in the view of the appellant, is unwarranted and without provision of law. 9.5 We have examined the submission made by the appellant and arguments given by them to support their claim. We find that term supply has been defined under Section 7 of CGST Act, 2017 which includes all forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease, or disposal made or agreed to be made for a consideration by a person in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with DISCOM, the DISCOM receives money in form of dislocation/shutting charges. The services supplied in such cases is related to an act of tolerance with respect to immovable property and hence covered under agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act and are classified under SAC 999794, c) The works contract services in this case is being supplied by an independent contractor and is covered under SAC 9954, it is distinct service which is being supplied by a registered person other than DISCOM, d) Though the property subjected to works contract services belongs to DISCOM but the supply of works contract services are not made on behest of DISCOM. The contract for works contract services is executed between the concerned party and a third party works contractor hence the DISCOM is a stranger to this contract, e) In a case where the third party works contractor remains unpaid for the services supplied by him he can sue only the concerned party and not the DISCOM, so the there is no liability to pay on the part of DISCOM, f) As the dislocation works are not made on behest of DISCOM and there is only a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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