Annual operation and maintenance of compactor and hook loader for lifting and removal of garbage is a composite supply of goods and services

Last updated: 23 January 2023

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The West Bengal Authority for Advance Ruling (AAR) has determined that the annual operation and maintenance of garbage compactors and hook loaders for waste removal is a composite supply of goods and services, not pure service. This is because spare parts are involved. Such supplies to government bodies are eligible for GST exemption if the value of goods does not exceed 25% of the total supply value.

Court :
Advance Ruling No. WBAAR 23 of 2022 dated October 21, 2022

Brief :
The AAR, West Bengal in the matter of Banchu Das [Advance Ruling No. WBAAR 23 of 2022 dated October 21, 2022] has ruled that, the supply of services to the Government or Government authority for annual operation and maintenance of capacity portable compactor and hook loader cannot be regarded as pure services and it is a composite supply of goods and services as it involves supply of goods like spare parts. Further, such composite supply is eligible for exemption from the payment of GST vide Sl. No. 3A of the Notification No. 12/2017 - Central Tax (Rate) dated June 28, 2017 ("the Services Exemption Notification"), if the value of goods involved in such composite supply does not exceed 25% of the value of supply.

Citation :
Advance Ruling No. WBAAR 23 of 2022 dated October 21, 2022

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