TaxTMI 
TaxTMI 
2020 (11) TMI 325
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted, Flat No. 24 kalaimagal Kalvi Nilayam Road, Erode 638 001 (hereinafter called the Applicant) are registered under GST with GSTIN.33AAACZ8255D1ZD. They are the service providers of Municipal Solid Waste (MSW) Management solutions and as an MSW Management company, they offer solutions involving segregation, treatment, recycling of Municipal Solid Waste(MSW) and thus clearing MSW landfills. The services provided by them is mandated under the Solid Waste Management Rules 2016 and Central Pollution Control Board Guidelines for Disposal of Legacy Waste, February 2019. The applicant has sought Advance Ruling on: 1. Classification of the services viz "Solid waste management - Revamping of existing dumped Garbage in compost yards by Bio -mining process" provided by the applicant to M/s. Erode City Municipal Corporation, Erode? 2. Whether aforesaid services provided by the applicant are exempted under Sl. No. 3 of notifications No. 12/2017 dt: 28.07.2017 as amended? 3. Whether the Erode city Municipal Corporation is liable to deduct TDS as per the provisions of section 51 of CGST Act of TNGST Act, 2017 for the services rendered as state in the application? T....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rangement for the plan project site, machineries, equipment etc; Thus they have to remove the legacy waste dumped by bio-mining process on putting up the processing plant/legacy waste removal plant under Design, Build, Own and Operate(DBOO). For the work executed the Erode City Municipal Corporation will give processing charges as quoted by them in the financial quote and accepted as in agreement, based on the net quantity of input waste processed from the Erode dump yard by them. As per the agreement dated 19/01/2019, processing fee is Rs. 670/= per Cubic Meter. 2.2 On the Interpretation of Statutory provisions they have stated that, with reference to the classification of the services provided, the predominant characteristic of the work is "Solid Waste Management" and they are of the view that the services rendered by them fall under SAC Code No: 9994 "Sewage and Waste collection, treatment and disposal and other environmental protection services" and in particular Group 99943-Waste treatment and disposal services" as per Annexure to Notification No: 11/2017 Central Tax (Rate) dated 28/06/2017. 2.3 With reference to the rate of GST for the services provided by them, it is s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....In the instant case, M/s. Erode City Municipal Corporation falls within the above notification as specified persons. However, as stated in the preceding submissions, the services rendered by them is exempted from payment of GST as per Sl. No. 3 of Notification No: 12/2017-Central Rate dated 28/06/2017. Hence no amount needs to be deducted as per the provisions of Section 51 of Act, ibid. 3.1 Due to the prevailing PANDEMIC situation and in order not to delay the proceedings, the appellant was addressed through the Email Address mentioned in the application to seek their willingness to participate in a virtual Personal Hearing in Digital media vide e-mail. The applicant consented and the hearing for admission of the application was held on 20.08.2020. S/Shri. Nagesh Prabhu, Director of the applicant company and B.Venkateswaran, Authorized Representative for applicants participated in the virtual personal hearing. They furnished a written submission which was taken on record. The authorized representative reiterated the submissions made along with the application and that furnished for the hearing shared in mail. It was intimated that of the three questions for which ruling is soug....
X X X X Extracts X X X X
X X X X Extracts X X X X
....onthly bills to the ULB based on the weight/ volume of the waste cleared from the landfill • Zigma reclaims land till the ground level (waste available upto ground level) o If required, ULB can ask Zigma to clear any waste available below the ground level for complete remediation • After complete reclamation/remediation, zigma decommissions the plant and machinery from the site • Zigma hands over the reclaimed land back to the ULB 3.4 With reference to question no. 3 raised by them, during the Virtual Hearing it was informed that the issue raised therein, was outside the purview of Advance ruling and they had agreed to drop it, however, they requested to reconsider the issue for the following reasons: The Advance Ruling authority is governed by the provisions of Chapter XVII of CGST ACT & the relevant Sections 95 to 98, 102, 103, 104 and 105. As per Section 95, the term 'advance ruling' means a decision provided by this authority to the applicant on matters or questions specified in Section 97(2), in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant. • As per S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ny comments and it is construed that there are no proceedings pending on the issue raised by the applicant. 6. We have carefully examined the statement of facts, supporting documents filed by the Applicant along with application, oral submissions made at the time of Virtual hearing and the comments of the Jurisdictional Authority. The applicant has been awarded the work of 'Revamping of Existing Dumped Garbage in Vendipalayam and Vairapalayam compost Yards by Bio-mining Process" under the Design, Build, Own and Operate concept. The applicant is before us seeking ruling on the following questions: 1. Classification of the services viz "Solid waste management - Revamping of existing dumped Garbage in compost yards by Bio -mining process" provided by the applicant to M/s. Erode City Municipal Corporation, Erode? 2. Whether aforesaid services provided by the applicant are exempted under SIC No. 3 of notifications No. 12/2017 dt: 28.06.2017 as amended? 3. Whether the Erode city Municipal Corporation is liable to deduct TDS as per the provisions of section 51 of CGST Act of TNGST Act, 2017 for the services rendered as state in the application? 7.1 From th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....own account as per SWM Rules 2016. The applicant has to recover the land of all the wastes and hand over to the Erode Municipality Corporation and the period of agreement is 24 months. The dumpsite is handed over to the applicant by the corporation as per Para 10 of the agreement with the right to use the site for the agreed purpose, i.e., disposal of the dumped MSW. The applicant is compensated based on the tonnage of waste disposed. The applicant raise invoice based on the weight/volume of the waste cleared from the landfill. They have furnished copies of Invoice raised by them on Erode City Municipal Corporation. On perusal of Invoice No. VAP\19-20\0042 dated 31-Mar-20, it is seen that the invoice is raised for the Quantity handled and is stated 'GST "NIL" as per Notification No. 12/2017-Central Tax(Rate) dated 28.06.2019 under Chapter 99'. Thus, the applicant undertakes processing of waste and disposal of the same and the reclaimed land free of the dumped waste is returned to the Corporation. In other words, the activity undertaken is treatment & disposal of waste dumped at the yard as per the SWM Rules 2016 and reclaiming of the land used as dump yard. 7.3 With the above fa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....al. The classification can further be confirmed by referring the 'Explanatory Notes to the Scheme of Classification of Service', which indicate the scope and coverage of the Scheme of classification of service and is a guiding tool for classification of services. 99943 Waste treatment and disposal services 999431 Waste preparation, consolidation and storage services This service code includes: i. consolidation, temporary storage, and preparation of hazardous waste ii. consolidation and preparation of hazardous waste for transportation to an appropriate facility that processes waste ............................ vi. consolidation, temporary storage and preparation of non-hazardous recyclable materials vii. transfer facility services of non-hazardous recyclable materials viii. recovery and preparation of non-hazardous recyclable materials, such as bailing, cleaning, sorting, volume reduction and similar preparation and consolidation of recyclable materials, for transportation to an appropriate facility that processes recyclable materials ix. consolidation, temporary storage and preparation of non....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e (Tariff) Description of Services Rate (per cent.) Condition 3 99 Pure services (excluding works contract service or other composite supplies involving supply of any goods) provided to the Central Government, State Government or Union territory or local authority or a Governmental authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. Nil Nil The above entry exempts • Pure Services • Provided to Central Government/ State Government/ Union Territory/ Local authority/ Governmental authority • By way of any activity in relation to any function entrusted to a • Panchayat under Article 243 G of the Constitution • Municipality under Article 243 W of the Constitution 8.2.1 In the case at hand, the activity undertaken by the applicant is 'disposal of solid waste dumped in the specified yards' and the same is 'Pure Service' classifiable under SAC 9994 as held in Para Supra, thus the first criterion is satisfied. 8.2.2 The servi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rations.- The local authorities and Panchayats shall,- (a) prepare a solid waste management plan as per state policy and strategy on solid waste management within six months from the date of notification of state policy and strategy and submit a copy to respective departments of State Government or Union territory Administration or agency authorised by the State Government or Union territory Administration; ................................... (zh) stop land filling or dumping of mixed waste soon after the timeline as specified in rule 23 for setting up and operationalisation of sanitary landfill is over; (zi) allow only the non-usable, non-recyclable, non-biodegradable, non-combustible and non-reactive inert waste and pre-processing rejects and residues from waste processing facilities to go to sanitary landfill and the sanitary landfill sites shall meet the specifications as given in Schedule-I, however, every effort shall be made to recycle or reuse the rejects to achieve the desired objective of zero waste going to landfill; (zj) investigate and analyse all old open dumpsites and existing operational dumpsites for their potential of b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ling requested is wrt the applicability of Notification No. 50/2018-Central Tax dated 13.09.2018 with reference to supply of their service and that they have fulfilled the requirements for advance ruling as per the provisions of Section 97 of the Act. We find that the question raised is Whether the Erode city Municipal Corporation is liable to deduct TDS as per the provisions of section 51 of CGST Act of TNGST Act, 2017 for the services rendered as state in the application? It is agreeable that the applicant supplies the service but the question raised is not on the applicability of the Notification to the applicant but the applicability of the Notification to the recipient of the services of the applicant, who is a distinct person for whom this ruling is not applicable as per Section 103 of the Act. For ease of reference, Section 103 of the Act is given below: 103. Applicability of advance ruling.- (1) The advance ruling pronounced by the Authority or the Appellate Authority under this Chapter shall be binding only- (a) on the applicant who had sought it in respect of any matter referred to in sub-section (2) of section 97 for advance ruling; ....