Concessional GST for warship parts applies only to integral and essential components, not merely end-use items.

Marine pressure tight cables and marine non-pressure tight cables supplied for warships do not qualify as "parts" of warships under Entry 252 of Schedule I to Notification No. 01/2017-Integrated Tax (Rate) unless they are shown to be integral and essential component parts of the vessel. The common parlance test was applied to the term "parts", and the notification was read as granting the 5% rate only where the goods are necessary for the completeness of the ship itself. Mere intended use in warships, or support from an end use certificate, is insufficient. On the facts, the cables were not established as indispensable to the warship, so the concessional GST rate was unavailable.

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Issues: Whether marine pressure tight cables and marine non-pressure tight cables supplied for use in warships are covered as parts of warships under Entry 252 of Schedule I to Notification No. 01/2017-Integrated Tax (Rate) and eligible for GST at 5%.

Analysis: The relevant entry grants 5% GST to parts of goods of headings 8901, 8902, 8904, 8905, 8906 and 8907. The expression "parts" was examined in its ordinary and commercial sense, applying the common parlance test and the principle that a component part must be integral to the constitution of the whole and necessary for its completeness. The notification does not grant concessional rate merely because goods are intended for warship use or supported by an end use certificate. The record did not establish that the cables were essential or integral parts of a warship, nor did it show the specific role of the cables within the vessel or that the ship would be incomplete without them. The earlier exemption under the pre-GST excise notification was also held to be distinguishable.

Conclusion: The cables are not parts of warships for purposes of Entry 252, and the 5% GST concession is not available.

Ratio Decidendi: Concessional GST for "parts" of warships applies only to goods proved to be integral and essential component parts of the vessel, and not merely to goods intended for warship use or supported by an end use certificate.

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