• Prasa Infocom & Power Solutions Private Limited (‘the Applicant’) is engaged in providing Data Centre construction and contracting services
• The Applicant entered into a Contract with Cray Inc. (‘Cray’) for preparation and maintenance of the Data Centre, wherein the parties would enter into mutually agreed written order for services and products (‘Statement of Work’ – SOW) on time to time basis
• Under the agreed SOW, the Applicant is required to perform design approval for the entire data centre, supply of items, loading unloading and installation of items at site, testing and commissioning of the installed equipment etc.
• Further, before supplying and subsequently commissioning the equipment(s), the Applicant is also required to undertake civil and mechanical works, namely construction of a civil structure to house the equipment

• Whether supply of goods and services by the Applicant to Cray qualify as ‘Works Contract’ as defined under Section 2(119) of the Central Goods and Services Tax Act, 2017 (‘the CGST Act’)?

• There is no building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair maintenance, renovation, alteration or commissioning of any immoveable property wherein transfer of property in goods is involved in the execution of the contract
• There is a clear demarcation between the supply of goods and services along with their respective costs. Further, the major value of the Contract exceeding 85% of the total cost of the project pertains to supply of goods (i.e.   sale of equipment/ machinery/ other various apparatus)
• Furthermore, it was observed that the services cannot be supplied by the Applicant without the supply of goods. Accordingly, goods and services are supplied as a combination, in conjunction and in the course or furtherance of their business where the principal supply is supply of goods

Hence, the supply made under the Contract qualifies as a composite supply (and not a ‘Works Contract’)