Authority of Advance Ruling levies GST on spare parts supplied to the Navy

Authority of Advance Ruling levies GST on spare parts supplied to the Navy

The charges include 2.5 percent Central Goods and Services Tax and 2.5 percent State Goods and Services Tax

The Maharashtra Authority of Advance Ruling (AAR) has held that 5 percent Goods and Services Tax (GST) would be payable on parts of diesel marine engines or generator sets supplied to the Indian Navy.

The Coram of Rajiv Magoo and T R Ramnani ruled that the parts would be chargeable only if they were used in ships and vessels falling under the GST tariff.

The applicant, a manufacturer of diesel, natural gas engines and power generation systems, deals with various segments including distribution of business. He provides products and packaging services and solutions. It ensures uptime of equipment, new and rebuilt engines, batteries and customer support services.

He had sought a ruling on spare parts including seawater pump, gasket, connection, link injector plunger, gasket flange, seals, shield for shutting the valve, thermostat and plug injector orifice. These were supplied to the Indian Navy for their use and fit-out in the marine diesel engine and generator sets of the ships and vessels.

The charges include 5 percent Integrated Goods and Services Tax (IGST) or 2.5 percent Central Goods and Services Tax (CGST) and 2.5 percent State Goods and Services Tax (SGST).