Gst on exempted service tax works contract

[Bijay Bharat]

Dear Sir/Madam,

Our company has went into a works contract agreement with state govt which mentions specifically that all taxes are included except service tax which will be reimbursed as per actual but now after GST coming into force when we had claimed the Cgst part as exemption or to be borne by client I.e state govt their is ambiguity and confusion kindly help out in this regard is their any law or way to claim the part to service tax which was rembursable .

Thank you

AI Summary

Company Confused Over GST Applicability in Government Contract; Service Tax Reimbursement Clause Sparks Debate Under CGST Act A company involved in a works contract with a state government is facing confusion regarding the applicability of GST after its implementation, as their contract specified that service tax would be reimbursed. Various forum participants clarified that under the CGST Act, the state government, as the service recipient, is liable for GST. Exemption Notification No. 12/2017-CT does not exempt services provided to the government. The consensus is that the government should pay GST, and the company can invoice including GST. If services were supplied before GST, service tax is reimbursable; otherwise, GST applies. Input tax credit is available for inputs and services.