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The Central Board of Indirect Taxes and Customs clarifies that inter-state movement of rigs, tools and spares, and all goods on wheels is neither a supply of goods nor a supply of service. The council recommends that the earlier circular applies to these movements between distinct persons. No integrated goods and services tax applies to this movement. This treatment does not apply when the movement is for further supply of the same goods. Applicable taxes remain leviable on repairs and maintenance done for such goods.
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Circular No. 21/21/2017-GST
F. No. 354/320/2017 –TRU (Pt ) Government of India Ministry of Finance Department of Revenue Tax Research Unit
North Block, New Delhi Dated the 22nd of November, 2017
To,
The Principal Chief Commissioner/Chief Commissioners/ Principal Commissioner/ Commissioner of Central Tax (All) / Director General of Systems
Subject: Clarification on Inter-state movement of rigs, tools and spares, and all goods on wheels [like cranes]- regarding.
The issue of IGST exemption on inter-state movement of various modes of conveyance, between distinct persons as specified in section 25(4) of the Central Goods and Services Tax Act, 2017, carrying goods or passengers or both; or for repairs and maintenance, [except in cases where such movement is for further supply of the same conveyance] was examined and a circular 1/1/2017-IGST dated 7.7.2017, was issued clarifying that such inter-state movement shall be treated “neither as a supply of goods nor supply of service” and therefore would not be leviable to IGST.
The issue pertaining to inter-state movement of rigs, tools and spares, and all goods on wheels [like cranes] was discussed in GST Council’s meeting held on 10th November, 2017 and the Council recommended that the circular 1/1/2017-IGST shall mutatis mutandis apply to inter-state movement of such goods, and except in cases where movement of such goods is for further supply of the same goods, such inter-state movement shall be treated ‘neither as a supply of goods or supply of service,’ and consequently no IGST would be applicable on such movements.
In this context, it is also reiterated that applicable CGST/SGST/IGST, as the case maybe, is leviable on repairs and maintenance done for such goods.
Difficulty if any, in the implementation of the circular should be brought to the notice of the Board. Hindi version would follow.
(Ruchi Bisht) Under Secretary (TRU)
