GST Rate matter

We are manufacturers of Pump sets, having GST rate of 12% as well as 18%.

We have got an order from PSU company for supply of Pump with Other Items (which we do not manufacture). As per the order single subject line is mentioned that "supply of pump for dewatering purpose". However as per its Bill of Quantity other items are also to be supplied (which are bought out, not being part of the pump) along with main product (pump). 

Query: PSU is asking for single GST rate @ 12% as applicable to Pump for total supplies (pump+other items), whereas other bought out items are procured @ 18%. Can we supply all these items in a single rate of 12%?,

Query: Since bought out items are not our product, nor we do any process on it, can it be considered as naturally bundled to our Product (pump) and can be taken under Composite Supplies ?

Invoice will be issued as "supply of pump for dewatering purpose" to PSU and no separate items are allowed to be shown in bill....

Thanks & Regards,

Basant

 

Replies (2)
Quick Summary
A pump set manufacturer faces a dilemma regarding GST rates for a PSU order. While their manufactured pumps attract a 12% GST, other procured items are subject to 18%. The PSU requests a single 12% GST rate for the entire order, including the bought-out items. The core question is whether these bought-out items can be considered part of a composite supply with the pumps, allowing for a single GST rate, especially when the invoice will only list the primary item.

Other bought out items cannot be clubbed with the pump under conventional purpose but while supply in the relevant documents it can be done provided it is being adjusted separately.

A very thin line of difference between naturally bundles and unnaturally bundled. But prima facie it seems naturally bundles. Will suggest you to take a proper written opinion on this.

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