Whether service provider has to charge GST onthe whole amount of the bill which includes multipleservices, or have to charge GST just on the primary service?

Facts of Case:

The nature of supply is related to renting of the motor vehicle. The service provider will be liable to pay
the expenses of fuel and maintenance of the vehicle. The consideration will be valued basis on the
kilometer traveled by the assessee. Further the expenses paid by the supplier is reimbursed by the
recipient.

The key factors considered in the judgement are abbreviated below:

• The provision of section 15 of CGST Act,2017 are very clear and in unambiguous terms it has been mandated that any amount that the supplier is liable to pay in relation to such supply but which
  has been incurred by the recipient of the supply and not included in the price actually paid or
  payable for the goods or services or both will be added in the value of supply.
• It is further observed that Karnataka Authority for Advance Ruling in the case of M/s. Goodwill
  Auto’s, Hubbali; Dharwad [202 (8) TMI 355 – AUTHORITY FOR ADVANCE RULINGS, KARNATAKA] has
  held that the cost of the diesel incurred for running DG Set in the course of providing DG Rental
  Service is nothing but additional consideration for the supply of DG Set on rent as per section 15 of
  the GST Act.

Judgement: As discussed above, all the consideration including reimbursement of any kind shall form part
of value of supply in view of Section 15 of the CGST Act, 2017 – the service provider has to charge GST on
the whole amount of bill which in the instant case is monthly rental and fuel on mileage basis.

Source: IN RE: M/S. UTTARAKHAND PUBLIC FINANCIAL STRENGTHENING PROJECT, AUTHORITY FOR
ADVANCE RULINGS, UTTARAKHAND, 27-03-2023

Nakul Sharma, Senior-Executive – Indirect Tax, SW India