Pure waste-processing service for municipal solid waste management falls under waste treatment and disposal, and is GST-exempt.

Maintenance of micro compost centres and processing of wet waste supplied by a municipal corporation is classifiable under Heading 9994, specifically Group 99943 for waste treatment and disposal services, because the activity is a manpower-based waste-processing service and does not involve supply of goods. The same service qualifies as a pure service supplied directly to a local authority in relation to solid waste management, a municipal function under the Twelfth Schedule, and is therefore exempt from GST under Serial No. 3 of Notification No. 12/2017-Central Tax (Rate).

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Issues: (i) Whether the activity of maintaining micro compost centres and processing wet waste supplied by Greater Chennai Corporation is classifiable under Heading 9994, and if so, under which group within that heading. (ii) Whether the said activity is eligible for exemption under Serial No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Issue (i): Whether the activity of maintaining micro compost centres and processing wet waste supplied by Greater Chennai Corporation is classifiable under Heading 9994, and if so, under which group within that heading.

Analysis: The service involved maintenance of micro compost centres, processing of wet waste received from the municipal corporation, and handing over of the manure back to the corporation. The activity did not involve supply of goods and was essentially a waste-processing service performed with manpower. Within Heading 9994, the activity was not merely waste collection; it involved treatment and disposal of wet waste, which more appropriately falls under Group 99943.

Conclusion: The activity is classifiable under Heading 9994, more specifically under Group 99943, namely waste treatment and disposal services.

Issue (ii): Whether the said activity is eligible for exemption under Serial No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Analysis: The exemption applies to pure services provided to a local authority by way of any activity in relation to a function entrusted to a municipality under Article 243W of the Constitution. The recipient was Greater Chennai Corporation, which is a local authority. The service was rendered directly to the corporation, was pure service in nature, and related to solid waste management, which is a municipal function under the Twelfth Schedule. The activity therefore satisfied all conditions for the exemption.

Conclusion: The service is exempt from GST under Serial No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Final Conclusion: The ruling recognizes the supply as a municipal waste-management service classifiable under the waste treatment and disposal category and treats it as an exempt pure service supplied to a local authority in relation to a constitutionally assigned municipal function.

Ratio Decidendi: A manpower-based waste-processing service rendered directly to a local authority for solid waste management, without supply of goods, qualifies as pure service in relation to a municipal function and is exempt under the relevant GST notification.

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