GST Exemption Ruling: Park fees, market fees exempt; services to banks taxable

The case involved issues related to the exemption of services under relevant GST notifications. The ruling determined that activities such as collecting fees for park maintenance, market fees, bus stand facilities, slaughterhouse fees, public toilets, and vehicle parking in bus stands were exempt from GST. However, services provided through tender contractors were taxable. The ruling also clarified the exemption for renting residential buildings and renting to government offices, while services to co-operative societies and nationalized banks were deemed taxable under GST.

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Issues Involved:
1. Whether the services rendered by the applicant directly are exempted under the relevant GST notifications.
2. Whether the services rendered by the applicant through tender contractors are exempted under the relevant GST notifications.
3. Whether the tax collected under direct charge instead of reverse charge can be regularized.
4. Whether the charges for laying cables alongside roads and road cutting charges can be classified as a composite supply and subject to reverse charge.
5. Whether full exemption is applicable for renting of residential buildings.
6. Whether renting of immovable property to various entities is fully exempted under the relevant GST notifications.

Issue-wise Detailed Analysis:

1. Direct Services Exemption:
- Fee from Parks: The activity of collecting fees for park maintenance is considered a public authority function under the Twelfth Schedule of the Constitution. As per Notification No. 14/2017-C.T.(Rate) dated 28th June 2017, this is neither a supply of goods nor services and is not taxable under GST.

- Market Fees (Daily and Weekly): The collection of market fees for providing market facilities is a function listed under the Eleventh Schedule of the Constitution. These activities are also exempt from GST under Notification No. 14/2017-C.T.(Rate) dated 28th June 2017.

- Fees for Bays in Bus Stand: The collection of fees for parking buses in bus stands is related to public amenities. This activity is exempt from GST as it is a public authority function under Notification No. 14/2017-C.T.(Rate) dated 28th June 2017.

- Locker Rent in Bus Stand: The activity of providing lockers for rent in bus stands does not fall under the functions listed in the Twelfth Schedule of the Constitution. Therefore, it is taxable under GST.

- Slaughter House Fees: The collection of fees for using slaughterhouse facilities is related to the regulation of slaughterhouses, a function listed in the Twelfth Schedule. This activity is exempt from GST under Notification No. 14/2017-C.T.(Rate) dated 28th June 2017.

- Fees on Pay & Use Toilets: The collection of fees for using public toilets is related to public conveniences. This activity is exempt from GST under Notification No. 14/2017-C.T.(Rate) dated 28th June 2017.

- Vehicle Parking Fees in Bus Stand: The collection of fees for parking vehicles in bus stands is related to public amenities. This activity is exempt from GST under Notification No. 14/2017-C.T.(Rate) dated 28th June 2017.

2. Services Rendered Through Tender Contractors:
- The contractors are not considered agents of the municipality but independent business entities who have been supplied with the right to collect fees. Therefore, the services provided by the contractors are not exempt under the relevant notifications. The supply of rights to collect fees by the municipality to the contractors is taxable under GST.

3. Regularization of Tax Collected Under Direct Charge:
- The question of regularizing the tax collected under direct charge instead of reverse charge is not within the purview of the Advance Ruling Authority as per Section 97(2) of the CGST Act. Therefore, this question is not admitted for consideration.

4. Composite Supply and Reverse Charge for Cable Laying Charges:
- The charges for road cutting and annual track rent are not considered a composite supply as they are not supplied in conjunction with each other in the ordinary course of business. Therefore, composite supply cannot be applied for classifying these services as renting of immovable property service.

5. Exemption for Renting of Residential Buildings:
- The exemption provided under entry no. 12 of Notification 12/2017 dated 28.06.2017 is applicable to the applicant for providing residential dwellings for use as residence.

6. Exemption for Renting of Immovable Property to Various Entities:
- State and Central Government Offices: Renting of immovable property service to another central/state government, union territory, or local authority is exempt from tax as per entry no. 8 of Notification 12/2017 dated 28.06.2017.

- Co-operative Societies and Nationalized Banks: The exemption is not available for services rendered to co-operative societies and nationalized banks. Therefore, these services are taxable under GST.

Ruling:
1. Direct Services Exemption:
- Maintenance of Park: Not a Supply of Service as per Notification No. 14/2017-C.T.(Rate).
- Providing Market Facilities (Daily and Weekly): Not a Supply of Service as per Notification No. 14/2017-C.T.(Rate).
- Providing Bays in Bus Stand: Not a Supply of Service as per Notification No. 14/2017-C.T.(Rate).
- Locker Rent Facilities: Taxable under GST.
- Providing Slaughter House Facilities: Not a Supply of Service as per Notification No. 14/2017-C.T.(Rate).
- Providing Toilet Facilities: Not a Supply of Service as per Notification No. 14/2017-C.T.(Rate).
- Providing Stand for Vehicles in Bus Stand: Not a Supply of Service as per Notification No. 14/2017-C.T.(Rate).

2. Services Rendered Through Tender Contractors:
- The applicability of the Notification to the supplies of the contractors is not answered as per S.95(a) readwith S.103(1) of the GST Act.

3. Regularization of Tax Collected Under Direct Charge:
- The question is not admitted under Section 98(2) of the Act.

4. Composite Supply and Reverse Charge for Cable Laying Charges:
- Composite supply cannot be applied for classifying the said service as renting of immovable property service.

5. Exemption for Renting of Residential Buildings:
- The exemption under entry no. 12 of Notification 12/2017 dated 28.06.2017 is applicable for providing residential dwellings for use as residence.

6. Exemption for Renting of Immovable Property to Various Entities:
- Renting of immovable property service to another central/state government, union territory, or local authority is exempt from tax. Services to co-operative societies and nationalized banks are not exempt and are taxable under GST.

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