The Andhra Pradesh Authority of Advance Ruling (AAR) ruled that the Goods and Service Tax (GST) is not applicable to the supply of mud engineering services along with the supply of imported mud chemicals and additives provided under the Contract does not qualify as composite service.
The applicant, Halliburton Offshore Services Inc. is a global service provider, engaged in providing various oilfield services to exploration and production companies across the globe.
The applicant has contracted to provide mud engineering services and drilling waste management services for drilling three HPHT exploratory wells in KG Basin, Andhra Pradesh.
The applicant has sought advance ruling on the issue whether the supply of mud engineering services along with a supply of imported mud chemicals and additives provided on consumption basis under the contract qualifies as composite supply.
Further, if the answer is ‘no’, then whether such supply of mud chemicals and additives on a consumption basis at OIL India’s location in India provided under the Contract qualify for concessional GST rate of 5% against an Essentiality Certificate (EC) under Notification dated June 30, 2017.
The Authority consisting of members D. Ramesh and M. Shreekanth ruled that the Goods and Service Tax (GST) is not applicable to the supply of mud engineering services along with a supply of imported mud chemicals and additives provided under the Contract does not qualify as composite service.
“The benefits under referred Customs Notification is available to supply of such goods at the time of their importation subject to fulfillment of description, tariff item, lists and conditions specified therein and subject to the satisfaction of the Proper Officer,” the AAR further ruled.
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