Section 15 of the CGST Act, 2017— Inclusion of amortised cost of tools in the value – The applicant filed an application for Advance Ruling under Section 97 of the Act. The applicant has sought advance ruling as to whether the amortised cost of the tool to be added to arrive at the value of the goods supplied under 15 of the Act. The applicant submitted that he is in the business of manufacturing Sheet Metal Pressed Components and caters to various industries, ATM, printers etc. The components were manufactured based on the drawing of the customer. To manufacture these components, the tools were designed and manufactured by the applicant. Such manufactured tools were billed to the customer, even though the tools are retained by the applicant for the manufacture of components. The payment was received by the applicant for the tool. The components supplied to the recipient are tailor made, hence are not available in the open market. Earlier Central Excise Valuation Rules has similar provisions and it was held that the cost of amortization of the tool was to be added to the value of the goods removed for the purpose of payment of Excise duty.

Held that:- The Hon’ble Authority for Advance Ruling, Karnataka held that amortised cost of tools which are re-supplied back to the applicant free of cost shall be added to the value of the components while calculating the value of the components supplied as per the Section 15 of the Act, 2017.Nash Industries (I) Pvt Ltd. [2018] 5 TAXLOK.COM 99 (AAR-KARNATAKA)