# Departmental Circulars – Clarified Supply Treatments
The CBIC has issued several circulars clarifying whether particular transactions amount to a 'supply' under GST and the rate / classification that applies. Memorise these as a checklist.
## 1. Supply of art works to galleries (sent on approval basis)
- Sending an art work to a gallery for display is not a supply at the time of dispatch.
- A supply arises only when the gallery (or its customer) accepts/buys the artwork.
- Until then it moves under a delivery challan, not a tax invoice.
## 2. Transfer of tenancy rights (pagadi system)
- Grant of tenancy rights against a tenancy premium is a taxable supply of service, even though the underlying property may be immovable.
- Sale/transfer of the building itself remains outside GST (Schedule III).
## 3. Food & beverages supplied at a cinema hall
- When supplied independently of cinema tickets, the supply of food / beverages at a cinema hall is taxable as a 'restaurant service' (at the restaurant rate), not at the cinema rate.
- When clubbed with the ticket as a single composite price, the entire bundle takes the rate of the principal supply (exhibition of cinema).
## 4. Holding of shares of a subsidiary by a holding company
- Mere holding of shares of a subsidiary by the parent company is not a supply of service.
- Hence no GST is leviable on such holding.
## 5. Inter-state movement of conveyances (between distinct persons of the same PAN)
- Inter-state movement of trucks, buses, cranes, rigs, tools and similar conveyances not for further supply is not regarded as a supply.
- However, repair and maintenance carried out on such conveyances is a supply of service and is taxable.
## 6. Printing contracts (composite supplies)
| Situation | Principal Supply | Treatment |
|---|---|---|
| Content supplied by author/publisher; only printing done by the printer | Service of printing | Supply of Service |
| Physical inputs (paper, envelope design supplied by recipient is used by printer to produce printed envelopes/letter heads/cartons) | Goods produced | Supply of Goods |
## 7. Priority Sector Lending Certificates (PSLCs)
- PSLCs traded between banks are treated as goods and are liable to GST.
## 8. Honorarium to guest anchors
- Honorarium received by guest anchors / artists from TV channels for appearing on a show is liable to GST (it is a supply of service) — provided the anchor crosses the threshold limit.
## 9. Sale of developed land (after levelling, drainage laying, etc.)
- Sale of plotted land — even after carrying out levelling, laying of drainage / electricity lines, etc. — remains covered by Schedule III (sale of land).
- Hence it is neither a supply of goods nor a supply of services.
## 10. Pre-Paid Instruments (PPIs)
- A PPI (e-wallet, prepaid card) is treated as money, hence its issue/loading is not a supply.
- An instrument that is not a PPI (e.g. unredeemed gift voucher representing a right) is an actionable claim.
## 11. ESOP / ESPP / RSU received from a foreign holding company
- When an Indian subsidiary employee receives shares of the overseas holding company under an ESOP/ESPP/RSU plan and the Indian company merely reimburses the cost (on cost-to-cost basis) without any markup, it is not regarded as a supply of service from the holding company.
- GST applies only if an additional fee/markup is charged over and above the cost of shares.