TaxTMI 
TaxTMI 
Dear sir,
Dealer supplies electrical items including installation service with portion of goods 75% and installation charges 25%. Whether the above supply is treated as works contract under GST or composite supply... please clarify and HSN/SAC.
classification
27 Aug 2021 
12 Replies 
4261 Views Asked by
Composite supply: where goods are principal and installation ancillary, tax at goods' rate applies rather than service rate.
Classification turns on whether the supply of electrical items with installation is a composite supply with goods as the principal supply-taxed and classified as goods (HSN) with installation ancillary-or a works contract/construction-related service where installation integral to immovable property brings the transaction under service classification (SAC); the determination depends on the installation's connection to immovable property, contract terms, and relevant advance rulings. (AI Summary)
Classification turns on whether the supply of electrical items with installation is a composite supply with goods as the principal supply-taxed and classified as goods (HSN) with installation ancillary-or a works contract/construction-related service where installation integral to immovable property brings the transaction under service classification (SAC); the determination depends on the installation's connection to immovable property, contract terms, and relevant advance rulings. (AI Summary)