Mixed supply treatment for steel fabrication and post-erection painting kept the composite contract taxable at 12%.

A contract for fabrication of steel structures, incidental paint supply, transport and post-erection painting was treated as a mixed supply because the fabrication and delivery component and the later painting component were not naturally bundled. Fabrication on goods supplied by another registered person fell within job work and was treated as manufacturing service supplied to a registered taxable person. The final coat of paint, applied only after erection, was a separate works contract element. As the supplies were combined for a single consideration but remained distinct in character, the composite arrangement was taxable at 12% on the basis stated in the ruling.

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Issues: Whether the applicant's contract for fabrication of steel structures, incidental supply of paint, transportation and application of paint on erected structures constituted a mixed supply, and whether the entire supply was taxable at 12%.

Analysis: The contract involved fabrication on goods supplied by another registered person, which fell within job work under the GST law. The fabrication obligation ended on delivery of the structures, while the obligation to apply the final coat of paint arose only after erection, making the latter a separate works contract element. The arrangement was not naturally bundled: the fabrication and delivery formed one supply, and the post-erection painting formed another supply made in conjunction with it. Since the supplies were combined for a single consideration but were not naturally bundled, the contract was treated as a mixed supply. The fabrication job work, being manufacturing service supplied to a registered taxable person, attracted 12%, and the works contract element, being a subcontracted works contract service, also attracted 12%.

Conclusion: The supply was correctly classified as a mixed supply and was taxable at 12%.

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