GST exemption for conservancy services hinges on whether the Vapi authority is a Governmental or local authority.

Conservancy services supplied to the Notified Area Authority, Vapi were claimed as exempt from GST under the 28.06.2017 exemption notification, on the basis that the authority is a Governmental authority or, alternatively, a local authority under the CGST Act. The argument was that the authority was constituted under the Gujarat Industrial Development Act, 1962 and performed functions relatable to Articles 243G and 243W of the Constitution. The matter required consideration, and notice was issued returnable in four weeks; no final adjudication was made.

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Issues: Whether conservancy services provided to the Notified Area Authority, Vapi are exempt from Central Goods and Services Tax under the exemption notification dated 28.06.2017, and whether that authority qualifies as a Governmental authority or a local authority.

Analysis: The petitioner relied on the notification constituting the authority under the Gujarat Industrial Development Act, 1962 and contended that it answers the description of a Governmental authority because it is established under a State enactment and performs functions relatable to Articles 243G and 243W of the Constitution of India. An alternative submission was that it falls within the definition of local authority under Section 2(69) of the Central Goods and Services Tax Act, 2017. The Court found that the matter required consideration.

Outcome: Notice was issued, returnable in four weeks, and the matter was not finally adjudicated.

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