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of <h1>GST Judgment: Chilled Water Plant Supply Classified as Composite Supply</h1> <h3>In Re: M/s. Air Control and Chemical Engineering Co. Ltd,</h3> In Re: M/s. Air Control and Chemical Engineering Co. Ltd, - TMI Issues Involved:1. GST rate applicable on the 'Supply, Testing and Commissioning of 160 TR Chilled Water Plant' to Naval Dockyard (Vishakhapatnam).2. HSN/SAC code applicable for the 'Supply, Testing and Commissioning of 160 TR Chilled Water Plant' to Naval Dockyard (Vishakhapatnam).3. Applicability of Notification No. 01/2017-IT (Rate), S. No. 252 (Any Chapter) for categorizing the Chilled Water Plant as 'Any Parts' and subject to GST @ 5% under HSN 8906.Issue-Wise Detailed Analysis:1. GST Rate Applicable:The applicant sought clarification on the GST rate for the 'Supply, Testing and Commissioning of 160 TR Chilled Water Plant' to Naval Dockyard, Vishakhapatnam. The judgment determined that this supply is a composite supply with the principal supply being the Chilled Water Plant (Chiller). It was concluded that the Chilled Water Plant falls under Chapter sub-heading No. 8418 10 10, which pertains to 'Refrigerators, freezers and other refrigerating or freezing equipment, electric or other; heat pumps other than air conditioning machines of heading 8415.' The applicable GST rate was 28% until 26.07.2018 and 18% from 27.07.2018.2. HSN/SAC Code Applicable:The judgment confirmed that the 'Supply, Testing and Commissioning of 160 TR Chilled Water Plant' to Naval Dockyard (Vishakhapatnam) is a composite supply with the principal supply being the Chilled Water Plant (Chiller). The applicable HSN code for this supply is 8418 10 10. This classification is based on the function of the Chiller, which is to chill water using a refrigeration cycle.3. Applicability of Notification No. 01/2017-IT (Rate), S. No. 252 (Any Chapter):The applicant argued that the Chilled Water Plant should be categorized under HSN 8906 as 'Any Parts' of vessels, which would subject it to a GST rate of 5%. However, the judgment clarified that the Chilled Water Plant is positioned on a jetty (Naval Dockyard) and not on a ship. It is used to supply chilled water to ships under repair, and thus, it cannot be categorized as 'Any Parts' of vessels under HSN 8906. Consequently, it is not subject to the 5% GST rate under this notification.Conclusion:The judgment concluded that the 'Supply, Testing and Commissioning of 160 TR Chilled Water Plant' to Naval Dockyard (Vishakhapatnam) is a composite supply with the principal supply of goods classified under HSN 8418 10 10. The applicable GST rate is 28% until 26.07.2018 and 18% from 27.07.2018. The Chilled Water Plant cannot be categorized as 'Any Parts' under HSN 8906, and thus, it is not subject to the 5% GST rate under Notification No. 01/2017-IT (Rate), S. No. 252 (Any Chapter).
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