Gst for ship building industry

1051 views 3 replies

When we are billing customer after delivery of boat/vessel our GST rate is 5% on the value. This reflects in my PO.

But when We are getting engine from dealer which will be fitted on
our boat/ship/dredger. He bills at GST of engine at 28%.

Please see page no 13, sr. no 246 to 252 in attachment. Our boat is
"Ferry Boat" - 8901. Tax 5%

As per sr. no 252, parts of goods of heading 8901 also comes under 5%.of GST Notification 1 of 2017

*In serial no 252, in column for HSN code, it is written "Any Chapter" which means that any raw material used for manufacture of boat will be taxed at 5%. *
So we should be able to  buy engine/materials/parts required for building at 5% even though they come under different HSN codes.
When approaching Dealer, he says Engine has an HSN code 84081093 which comes under 28% and.He does not know how to bill at 5%.
-----

What I understand is that when dealer makes the filings after selling the engine to us at 5%, using GSTN 3B he has to manually file the same HSN ( 84081093 in this case) under which the engine ( or item) is classified with a narration that

*only 5 % GST has been levied, basis notification 1 of 2017 as per sr no 252.*

The dealers are not accepting or understanding this line of logic/argument we are putting forward.

There is a huge difference in the GST tax component for the various parts/materials/equipments required to make a boat/ship
If we can get this advantage as per this notification, it is quite substantial. The problem is convincing the suppliers of this.

Without some proof authoprised by GST council, they are not going to accept our argument.

Hope you can shed some light on how to convince them. 

Rgds Dipak Mohan (dipakmohan @ gmail.com)


Attached File : 2434329 20180529191141 notification for igst rate schedule 1.pdf downloaded: 156 times
Replies (3)
It is a case of composite supply as per section 8(1) of the CGST act 2017 and will attract the rate of principal supply i.e boat/vessel

Tku sir, I have been breaking my head for the past few months to get this notification. Tku very much

Sir I do have similar problem in convincing manufacturers/dealers. can you please guide the process to avail 5% GST for Ship building raw materials. It would be great if you could share some invoices and GSTN 3B if any which has 5% GST. Thanks Lakshmanan 9843407189

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