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Composite supply

22 April 2020

In case of composite supply if principal supply is exempt supply then what should be rate of tax in value of composite supply?

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5 Replies

CA Naveen Chand (Chartered Accountant) (12739 Points)
Replied 22 April 2020

then whole bundle shall be exempt

Devil (Confidential) (177 Points)
Replied 23 April 2020

Exempt whole

Avinash Kumar (CA-Final Students) (192 Points)
Replied 23 April 2020

Whole supply will be exempt.

akshay Kumar (137 Points)
Replied 23 April 2020

It will be considered as wholly exempt

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Shivam RC (Student) (23683 Points)
Replied 23 April 2020

As per the Provision of Section 8 of the CGST Act 2017 i.e. "TAX LIABILITY ON COMPOSITE and MIXED SUPPLY" :

(a). A Composite Supply comprising two or more supplies, one of which is a PRINCIPAL Supply, shall be treated as a supply of such "PRINCIPAL SUPPLY".

Hence by analysing the Provision we find that in case of Composite Supply, the Rate of PRINCIPAL SUPPLY is taken into consideration.

Since your Principal Supply is Exempted, therefore, the Composite Supply shall be treated as "EXEMPT SUPPLY".

Regards.

4 Like