2019 (11) TMI 1566 - AAR - GST

Composite Supply Ruling: Printing Trade Ads on PVC - GST Rates Update

In Re: M/s Macro Media Digital Imaging Pvt. Ltd.,

In Re: M/s Macro Media Digital Imaging Pvt. Ltd., - 2021 (47) G.S.T.L. 304 (A. A. R. - GST - Haryana) Issues:1. Whether the activity of procuring PVC material, printing trade advertisements, and supplying them amounts to the supply of goods under the CGST ActRs.2. What is the appropriate classification of the trade advertisements if they are considered as the supply of goodsRs.3. What is the classification and applicable rate of Central Goods and Services Tax on the supply of trade advertisement material if the transaction is considered as the supply of servicesRs.Analysis:1. The applicant argued that their activity of printing trade advertisements on PVC material supplied by customers amounts to the supply of goods. They emphasized the transfer of title and relied on a TRU circular for support. The Authority noted that the nature of supply needed examination to determine if it constituted goods or services.2. The Authority referred to a circular clarifying that the principal supply in printing contracts is the supply of printing, constituting a service. The circular differentiated between supplies of goods and services based on ownership of intangible inputs. In this case, as the applicant did not retain usage rights of intangible inputs, the printing service was deemed the principal supply.3. The Authority highlighted that the printing service was the predominant element of the composite supply, classifying it under heading 9989. They determined the applicable GST rate to be 18% until 12.10.2017 and 12% thereafter, as per specific notifications.Conclusion:The Authority ruled that the transaction involving printing and supplying trade advertisements on PVC material is a composite supply with the printing service as the principal supply. The classification falls under heading 9989 with an applicable GST rate of 18% or 12%, based on the date.