Pure labour for stand-alone residential construction qualifies for GST exemption when no goods are supplied and conditions are met.

Pure labour services for construction, erection, commissioning or installation of original works are exempt from GST under Entry No. 11 of Notification No. 12/2017-Central Tax (Rate) where no goods or materials are supplied by the service provider, and the work relates to a single stand-alone residential dwelling unit rather than a residential complex. The exemption is confined to new or similar original works for a self-contained residential unit used by one family and does not extend to multi-unit housing projects with common facilities. On the stated facts, the applicant supplies only labour to individual owners of stand-alone houses, so the services qualify for exemption subject to the prescribed conditions.

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Issues: Whether pure labour services for construction, erection, commissioning or installation of original works pertaining to a single stand-alone residential dwelling unit, otherwise than as part of a residential complex, are exempt from GST under Entry No. 11 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Analysis: Entry No. 11 exempts pure labour contracts relating to construction, erection, commissioning or installation of original works where no goods or materials are supplied by the service provider and the services pertain to a single residential unit not forming part of a residential complex. The relevant definitions of original works, residential complex and single residential unit confirm that the exemption is confined to new construction or similar original works for a self-contained residential unit used for one family, and excludes apartment buildings or housing projects with multiple dwelling units and common facilities. On the facts, the applicant supplies only labour, without any transfer of property in goods, and the services are rendered only to individual owners of stand-alone residential houses.

Conclusion: The services qualify for exemption under Entry No. 11 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, subject to fulfilment of the stated conditions.

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