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    Circularno 34 CGST

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    jainrushab55
    1. The circular clarifies the tax treatment of certain services under GST including bus body building, retreading of tyres, priority sector lending certificates, and services provided by electricity distribution companies and state governments. 2. It determines that bus body building involves both supply of goods and services, retreading of tyres is predominantly a supply of services, and priority sector lending certificates are taxable goods. 3. Electricity transmission and distribution is exempt but other services of DISCOMs like connection fees and equipment rentals are taxable, and guarantee services provided by state governments are also taxable.

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    Circularno 34 CGST

    Uploaded by

    jainrushab55
    8 views3 pages
    1. The circular clarifies the tax treatment of certain services under GST including bus body building, retreading of tyres, priority sector lending certificates, and services provided by electricity distribution companies and state governments. 2. It determines that bus body building involves both supply of goods and services, retreading of tyres is predominantly a supply of services, and priority sector lending certificates are taxable goods. 3. Electricity transmission and distribution is exempt but other services of DISCOMs like connection fees and equipment rentals are taxable, and guarantee services provided by state governments are also taxable.

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    1. The circular clarifies the tax treatment of certain services under GST including bus body building, retreading of tyres, priority sector lending certificates, and services provided by electricity distribution companies and state governments. 2. It determines that bus body building involves both supply of goods and services, retreading of tyres is predominantly a supply of services, and priority sector lending certificates are taxable goods. 3. Electricity transmission and distribution is exempt but other services of DISCOMs like connection fees and equipment rentals are taxable, and guarantee services provided by state governments are also taxable.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    8 views3 pages

    Circularno 34 CGST

    Uploaded by

    jainrushab55
    1. The circular clarifies the tax treatment of certain services under GST including bus body building, retreading of tyres, priority sector lending certificates, and services provided by electricity distribution companies and state governments. 2. It determines that bus body building involves both supply of goods and services, retreading of tyres is predominantly a supply of services, and priority sector lending certificates are taxable goods. 3. Electricity transmission and distribution is exempt but other services of DISCOMs like connection fees and equipment rentals are taxable, and guarantee services provided by state governments are also taxable.

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    Circular No.

    34/8/2018-GST
    F. No. 354/17/2018-TRU
    Government of India
    Ministry of Finance
    Department of Revenue
    Tax research Unit
    ****
    Room No. 146G, North Block,
    New Delhi, 1st March 2018
    To,
    The Principal Chief Commissioners/ Chief Commissioners/ Principal Commissioners/
    Commissioner of Central Tax (All) /
    The Principal Director Generals/ Director Generals (All)

    Madam/Sir,
    Subject: Clarifications regarding GST in respect of certain services
    I am directed to issue clarification with regard to the following issues as approved by
    the Fitment Committee to the GST Council in its meeting held on 9th, 10th and 13th January
    2018:-
    S. Issue Clarification
    No.
    1. Whether activity of bus body In the case of bus body building there is supply of
    building, is a supply of goods goods and services. Thus, classification of this
    or services? composite supply, as goods or service would depend
    on which supply is the principal supply which may be
    determined on the basis of facts and circumstances of
    each case.
    2. Whether retreading of tyres In retreading of tyres, which is a composite supply, the
    is a supply of goods or pre-dominant element is the process of retreading
    services? which is a supply of service. Rubber used for
    retreading is an ancillary supply. Which part of a
    composite supply is the principal supply, must be
    determined keeping in view the nature of the supply
    involved. Value may be one of the guiding factors in
    this determination, but not the sole factor. The primary
    question that should be asked is what is the essential
    nature of the composite supply and which element of

    1
    Circular No. 34/8/2018-GST
    the supply imparts that essential nature to the
    composite supply.
    Supply of retreaded tyres, where the old tyres belong
    to the supplier of retreaded tyres, is a supply of goods
    (retreaded tyres under heading 4012 of the Customs
    Tariff attracting GST @ 28%)
    3. Whether Priority Sector In Reserve Bank of India FAQ on PSLC, it has been
    Lending Certificates mentioned that PSLC may be construed to be in the
    (PSLCs) are outside the nature of goods, dealing in which has been notified as
    purview of GST and a permissible activity under section 6(1) of the
    therefore not taxable? Banking Regulation Act, 1949 vide Government of
    India notification dated 4th February, 2016. PSLC are
    not securities. PSLC are akin to freely tradeable duty
    scrips, Renewable Energy Certificates, REP license or
    replenishment license, which attracted VAT.

    In GST there is no exemption to trading in PSLCs.


    Thus, PSLCs are taxable as goods at standard rate of
    18% under the residuary S. No. 453 of Schedule III of
    notification No. 1/2017-Central Tax(Rate). GST
    payable on the certificates would be available as ITC
    to the bank buying the certificates.

    4. (1) Whether the activities (1) Service by way of transmission or distribution of


    carried by DISCOMS electricity by an electricity transmission or distribution
    against recovery of charges utility is exempt from GST under notification No.
    from consumers under State 12/2017- CT (R), Sl. No. 25. The other services such
    Electricity Act are exempt as, -
    from GST? i. Application fee for releasing connection of
    electricity;
    (2) Whether the guarantee ii. Rental Charges against metering equipment;
    provided by State iii. Testing fee for meters/ transformers,
    Government to state owned capacitors etc.;
    companies against iv. Labour charges from customers for shifting
    of meters or shifting of service lines;

    2
    Circular No. 34/8/2018-GST
    guarantee commission, is v. charges for duplicate bill;
    taxable under GST? provided by DISCOMS to consumer are taxable.

    (2) The service provided by Central Government/State


    Government to any business entity including PSUs by
    way of guaranteeing the loans taken by them from
    financial institutions against consideration in any form
    including Guarantee Commission is taxable.

    2. Difficulty if any, in the implementation of this circular may be brought to the notice
    of the Board.

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