The supply, installation, testing, and commissioning of oxygen pipeline systems in government hospitals are subject to an 18% GST.

The AAR, Chhattisgarh in the matter of M/s Goel Medico

The activity of supplying, installing, testing, and commissioning an oxygen pipeline system in a government hospital is carried out by M/s Goel Medico (“the Applicant”). The applicant claimed that because their operation was a composite supply, is covered under the Services Accounting Code (“SAC”) 995464 and should be exempted vide Notification No. 05/2021-Central Tax

The AAR, Chhattisgarh in the matter of Advance Ruling No. STC/AAR/09/2021 held as under:

The activity of the applicant is a supply made up of two or more taxable supplies of products, services, or both, as well as their combination, which are naturally combined and supplied together in the regular course of business.

It is acknowledged that the applicant’s activity comprises installation services and equipment for the supply or conduct of oxygen and other gases used in homes, hospitals, and other locations that are subject to an 18% GST.

The exemption provided by the contested notification did not apply to the work contract services that the applicant is providing, only to COVID-related items. As a result, the contested notification does not apply to the applicant’s activity. Therefore, not exempt.