Surface coating on goods covered under repair services & taxable at 18%: AAR

Case Details: Authority for Advance Rulings, Maharashtra Oerlikon Balzers India (P.) Ltd., In re - [2022] 136 taxmann.com 123 (AAR - MAHARASHTRA)

Judiciary and Counsel Details

• • Rajiv Magoo and T.R. Ramnani, Member

Facts of the Case

The applicant was engaged in surface coating on old and worn out goods received from customers. It filed an application for advance ruling to determine taxability of activity of surface coating on old, used or worn-out goods.

AAR Held

The Authority for Advance Ruling observed that applicant would restore the old or damaged goods into good condition and also improved the functionality of the said goods, by the impugned activities. In the instant case, old, worn out cutting tools and components/goods would be converted into reusable cutting tools and components/goods. The end users therefore in the instant case can’t be termed as principal as referred in a Job work process. Therefore, it would be treated as an activity of repair and would fall under SAC 9987 and attract GST at 18%.

Case Review

• • Saraswati Industrial Syndicate Ltd. v. Union of India 1985 taxmann.com 357 (Punj. & Har.) (para 5.6.11) followed.

List of Cases Referred to

• • Maruti Suzuki India Ltd. v. CCE [2015] 57 taxmann.com 300/51 GST 59 (SC) (para 2.13)
  • Prestige Engineering (India) Ltd. v. CCE 1994 taxmann.com 232 (SC) (para 2.15)
  • Radiowani v. CST [2018] 96 taxmann.com 313 (Mum. – CESTAT) (para 2.22)
  • ENP Techno Engineers, In re [2021] 123 taxmann.com 407 (AAR – Guj.) (para 2.32)
  • Electroplating and Metal Finishers, In re [2020] 115 taxmann.com 98/82 GST 410 (AAR – Tamilnadu) (para 2.32)
  • Saraswati Industrial Syndicate Ltd. v. Union of India 1985 taxmann.com 357 (Punj. & Har.) (para 5.6.11).