Contract to provide particular services to customers of SPA in India amounts to Composite Supply: AAR [Read Order]

Composite Supply - SPA - AAR - Contract - Taxscan

The Gujarat Authority of Advance Ruling (AAR) ruled that the Contract provide particular services to customers of SPA in India amounts to composite supply.

The applicant, M/s. Stovec Industries Ltd. is the supplier of products in the textile and graphics printing market and engaged in manufacturing Rotary screen printing machines and also offers products for conventional and digital engraving methods.

The applicant submitted that they have entered into a contract with SPG Prints Austria GMBH (SPA) to provide particular services to customers of SPA in India, as per SPA’s instruction. Such services shall include installation / up-gradation of machines sold by SPA, training at SPA’s customers’ site etc. The copy of the contract has been enclosed for reference.

The applicant sought advance ruling on the issue whether, in the facts and circumstances, the specified transaction of the Applicant should be categorized as individual supply or composite supply of service as per the Central Goods and Services Tax Act, 2017 and the Gujarat Goods and Services Tax Act, 2017.

The coram consisting of Sanjay Saxena and Mohit Aggarwal ruled that the specified transaction of the Applicant is a composite supply of service as per the Central Goods and Services Tax Act, 2017.

The AAR ruled that the specified transaction of the Applicant is categorized as an “intermediary” as per Section 2(13) of The Integrated Goods and Service Tax Act, 2017.

The AAR ruled that the specified transaction does not qualify to be “Export of service” as per Section 2(6) of The Integrated Goods and Services Tax Act, 2017.

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