Tax liability on composite and mixed supplies
Section 8, CGST Act
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Amendment history
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Section 8 fixes how COMPOSITE and MIXED supplies are taxed: a composite supply (naturally bundled) takes the rate of its principal supply; a mixed supply (separate items sold together for a single price) takes the highest rate among them.
What this means in practice
The parts that actually decide cases — the things a practitioner checks first.
Composite supply: two or more supplies naturally bundled and supplied together in the ordinary course of business, one of them principal – it takes the principal supply’s rate.
Mixed supply: items that could be supplied separately, sold for a single price – the HIGHEST rate in the bundle applies to the whole.
Works contract and restaurant supply are composite supplies declared as SERVICES by Schedule II, so they never get split.
Freight charged on an invoice for goods usually follows the goods as a composite supply; charging it at the freight rate is a common and expensive error.
Questions people actually ask
Real questions we get on this provision, answered straight.
We sell a machine and charge separately for installation and freight.+
That is normally a composite supply with the machine as the principal supply, so the whole invoice takes the machine’s rate – including the freight and installation lines. Splitting them and charging different rates invites a demand for the difference.
The exact words of the law
462 characters, uneditedReproduced from the CBIC text. We explain it above — but you should always be able to read it yourself.
Read the full provision+
(a) a composite supply comprising two or more supplies, one of which is a principal supply, shall be treated as a supply of such principal supply; and
(b) a mixed supply comprising two or more supplies shall be treated as a supply of that particular supply which attracts the highest rate of tax.
High Court cases on this section
Judgments in our index that cite this provision. Being listed does not make a case good law — it may have been appealed or distinguished since. Read it before relying on it.
M/S. CHINNAN SONS JEWELLERY v. THE COMMERCIAL TAX OFFICER
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M/s.Chem India v. The Superintendent of GST
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TVL.SRI MANICKKA VINAYAGAR SPI v. THE COMMERCIAL TAX OFFICER
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Sri Avantika Contractors (I) Limited, v. Appellate Authority for Advance Ruling (GST),
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M/s. L.S.Mills v. The Assistant Commissioner of CGST and C.Excise
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M/s. Vuram Technology Solutions Private Limited v. The Additional Commissioner of GST (Appeals)
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M/s. Indian Ocean Sands Company (P) Ltd v. The Assistant Commissioner (ST)
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M/S.K.V.N. IMPEX P LTD. v. THE JOINT DIRECTOR, DIRECTORATE GENERAL OF GST INTELLIGENCE
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1 more on record. Search all GST case law →
What changed, and when
The amendment trail, newest first — because the version that applies to your case depends on the period.
2017-07-01 · Commenced
Provision as originally enacted in the CGST Act, 2017 (Act 12 of 2017) and brought into force w.e.f. 01-07-2017.
Where this comes from
Text reproduced from the Central Board of Indirect Taxes and Customs, as available on 2026-09-05. The explanation and practice notes above are GSTZone’s own, written for this hub. If you spot anything out of date, tell us and we’ll fix it — this hub is checked daily against CBIC.
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