Supply of asset at retail outlets

[JOHN SHANNEL]

hi, My organisation is in beverage sector. we give fridge to shops/retail outlets to ensure supply of chilled beverages to consumers. we also pay rent to retail outlets for the space occupied.

My question is , what is the document with which i need to send the asset to shops/retail outlets.? does this considered as supply?

[KASTURI SETHI]

SH.JOHN SHANNEL JI,

In this scenario, since the ownership of fridge etc. remains with your organization, so it is not supply. It is not a permanent transfer. Hence such temporary transfer is not covered under Schedule-1. You can send such assets under 'delivery challan'. under Rule 138 A(5)(b) of CGST Rules.

[Shilpi Jain]

Yes..agree with kasturi sir. Also this is not in the nature of gift and thereby credit should also be eligible...

[JOHN SHANNEL]

Thanks for the reply, would also like to check is there any timelimit for taking back the asset from the outlet. eg; can he use the asset for 5 years?

[Shilpi Jain]

Since this transaction is not job work, there is no time limit to get back the goods.

AI Summary

Temporary provision of assets: not treated as supply; use delivery challan and input tax credit remains eligible.
Temporary provision of a refrigerating asset to retail outlets where ownership remains with the supplier does not constitute a supply and may be sent under a delivery challan under Rule 138A(5)(b) of the CGST Rules. The placement is not a gift, so input tax credit remains available, and because it is not job work there is no statutory time limit for taking the asset back.