CBIC Circular No. 216/10/2024-GST: GST Liability and ITC Clarifications for Warranty Cases

• Ministry of Finance released Circular No. 216/10/2024-GST clarifying GST liability and ITC for warranty and extended warranty cases
• Circular extends previous clarifications on part replacements under warranty to entire goods replacements
• No GST payable on replenishment of goods or parts by manufacturer to distributor under warranty
• Treat extended warranty sold at the time of original supply as separate supply, not part of composite supply
• Treat extended warranty sold after original supply as separate supply of services
• Consistency in GST treatment for entire product replacements under warranty
• Distributors replacing goods under warranty will not face additional GST or ITC reversal challenges
• Extended warranty must be treated as distinct supply of services, attracting applicable GST
• Supplier of extended warranty must fulfill GST obligations for these services

Source: linkedin.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

---

---