Consultancy services for urban development projects exempt from CGST and UPGST under constitutional functions

The Authority for Advance Ruling, Uttar Pradesh, determined that the consultancy services provided by the applicant under specific contracts to State Urban Development Agency and Pradhan Mantri Awas Yojana qualify as activities related to functions entrusted to Panchayat or Municipality as per the Constitution of India. Additionally, the services were deemed to be "Pure services" exempt from tax under notifications of CGST and UPGST Acts. Consequently, the services rendered were found eligible for exemption from CGST and UPGST, aligning with constitutional functions and exemption criteria under the GST Acts.

---

---

Issues:
1. Whether consultancy services provided by the applicant under specific contracts qualify as activities related to functions entrusted to Panchayat or Municipality as per the Constitution of IndiaRs.
2. Whether the services provided qualify as "Pure services" exempt from tax under specific notifications of CGST and UPGST ActsRs.

Issue 1:
The applicant sought clarification on whether consultancy services provided to State Urban Development Agency (SUDA) and Pradhan Mantri Awas Yojana (PMAY) fall under functions entrusted to Panchayat or Municipality as per the Constitution of India. The Authority examined the purpose and scope of work under the contracts with SUDA and PMAY. The detailed analysis included the objectives of SUDA and PMAY, along with functions related to Panchayats and Municipalities as per the Constitution. The scope of work awarded to the applicant was thoroughly reviewed, confirming that the consultancy services rendered are indeed in relation to functions entrusted to Municipalities and Panchayats under the Constitution.

Issue 2:
The second question revolved around whether the services provided by the applicant qualify as "Pure services" exempt from tax under specific notifications of CGST and UPGST Acts. The Authority analyzed the contracts awarded by SUDA and the Government of Uttar Pradesh, focusing on the Detailed Project Report (DPR) preparation and Project Management Consultancy for PMAY. After examining the agreements and scope of work, it was concluded that the services rendered by the applicant indeed qualify as "Pure services" as per the relevant notifications of CGST and UPGST Acts. Therefore, the services are eligible for exemption from the levy of CGST and UPGST, respectively.

This detailed judgment by the Authority for Advance Ruling, Uttar Pradesh, provided a comprehensive analysis of the consultancy services provided by the applicant under specific contracts, ensuring alignment with constitutional functions and exemption criteria under the GST Acts. The ruling clarified the nature of services rendered and their eligibility for tax exemption, offering valuable insights into the interpretation of relevant legal provisions in the context of the specific case presented before the Authority.

---