Composite Supply, Invoice and HSN

[Lakshya Goyal]

Dear Experts

Pls answer my query presented via below mentioned case scenario.

Case: Ramesh sells a AC(MRP ₹64000) to Sunita on MRP with ₹50,000 being taxable value and ₹14,000 being the GST amount. Also he charges ₹1000(exclusive of GST) as shipping charges. He pays ₹1000 to GTA (₹50 GST payable under RCM). This supply appears to be a composite supply of goods with delivery as per GST law. So GST collectible from Sunita on delivery charges would be @ 28%. Now he cannot bill AC ₹51,000 plus GST ₹14,280 as goods cannot be sold above MRP, so shipping needs to be shown separately.

Query:

1. What are list of supplies included in invoice? Is it AC with separate HSN of goods and Delivery charges with SAC code or both supplies with HSN of AC because tax rate of 28% is applicable only for HSN of AC?

2. If in above scenario Ramesh gets GTA to issue bilty in name of Sunita and receives ₹1000 from her which he forwards to GTA. So in this case will the shipping charges be included in Value of Supply considering that it as mere flow of money and no consideration involved?

[Shilpi Jain]

1. HSN should be the one that is applicable for the AC

2. Can be treated as a pure agent transaction and be kept out of 28% GST. Ensure documentation is appropriately maintained.

[Sangeetha D]

In this case how will be the HSN Summary for GSTR-1 Filling. We need to provide quantity Wise breakup. Can we show like this.

HSN	UQC	Total quantity	Taxable Value	Rate
8415	Nos-numbers	2	51,000	18%

AI Summary

Composite supply: HSN of the principal good governs tax; pure agent delivery charges may be excluded with documentation. A supply comprising a principal good with ancillary delivery is treated as a composite supply governed by the principal good's HSN and rate. Delivery charges can be excluded from the supplier's taxable value if they qualify as a pure agent transaction-separately billed, unmarked-up, procured from a third party in the recipient's name-and supported by proper documentation; excluded ancillary charges do not change the principal supply's HSN for reporting.