Latest GST Judgments

For Full Access To All Latest Judgments on GST
Click Here To Subscribe Now
Take a tour of our GST Library

GST is levied on the reimbursement of expenses from the lessee by the lessor at actuals and as the reimbursement of the expenses constitute composite supply GST would be payable at a rate as applicable to the principal supply.

Levy of GST— the applicant, seeking an advance ruling in respect of the following questions : 1- Whether GST is levied on the reimbursement of expenses from the lessee by the lessor at actuals? 2- In case GST is levied what is the rate of GST applicable to said reimbursement of expenses Held that— we find that renting of immovable property would be the main supply and provision of other utilities such as electricity, and water supply, fuel etc. would be in the nature of ancillary supply which help in better enjoyment of the main supply that is Theatre. Principal supply or main supply basically signifies the supply of goods or services that is formed as a substantial constituent of a composite supply and any other supply being ancillary. We must accept as a matter of fact all provision of services as envisaged by the contract are interdependent and if one or more is removed the nature of supply would be affected. From the above discussion we conclude that utility charges in the nature of electricity charges and water reimbursed by the applicant from lessee forms part of composite supply. As the reimbursement of the expenses constitute composite supply GST would be payable at a rate as applicable to the principal supply.