Classification Of Goods

The GST law enacted under Article 246A of the Indian constitution made a significant attempt to unify the tax law on ‘goods and services’. Yet, distinctions prevail in areas of rate fixation, exemptions, time of supply, place of supply, refunds, input tax credit eligibility, etc. To appreciate this, we could examine certain experiences of the GST law.

REAL LIFE EXPERIENCE

Apex courts have settled that any movable property (tangible or intangible) having fundamental attributes (a) utility; (b) capable of being bought and sold; and (c) capable of being transmitted, transferred, delivered, stored and possessed, would be “goods”. In contrast, “services” has been stated to be as ‘anything other than goods’. While negative phraseology draws a Chinese wall between goods and services, an overlap re-emerges on application of the phrase “supply of goods” or “supply of services” (generally when both components are combined in a single transaction).

We may recollect instances of the health care industry grappling with taxability on supply of implants used in medical surgeries; educational sector facing legal ambiguity on providing books, periodicals, materials to students, IT services were subjected to tax as goods and services, etc. While the Supreme Court in the famous BSNL judgement coined the ‘dominan