TaxTMI 
TaxTMI 
2019 (10) TMI 1389
X X X X Extracts X X X X
X X X X Extracts X X X X
....per Request for Proposal (REP) (submitted with this Authority) for design, Engineering, Finance, Construction, Operation and Maintenance of Gurgaon- Faridabad and Ballabhgarh-Sohna Roads on BOT basis are activity in relation to function entrusted to Panchayat or Municipality under Article 243G or Article 243W respectively, of the Constitution of India? (ii) Whether the services by way of Independent Consultancy Services provided or to be provided by the Applicant to Public Works Department, Gurgaon as per Request for Proposal (RFP) are Pure Services qualifying for exemption from levy of CGST and SGST, as notified in serial number 3 of Notification No. 12 of 2017- Central Tax (Rate) dated 28.06.2017 issued under Central Goods and Services Tax Act, 2017 (CGST Act, 2017) and corresponding notifications issued under Haryana Goods and Services Tax Act, 2017 (HGST Act, 2017)? (iii) If the answer to Question No. (ii) above is negative, whether, the Applicant is within its rights under the CGST and HGST Acts for charging GST to the Service Recipient on the service value for the services provided as per RFP (Annexure 1)? 2. Applicant's submission: 2.1 The Applica....
X X X X Extracts X X X X
X X X X Extracts X X X X
....usted 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. Entry SI.No.3 of Notification No. 12/2017 - Central Tax (Rate) dated 28.06.2017 is as under: SI.No. Chapter, Section, Heading, Group or Service Code Description of Services Rate (percent) Condition 3. Chapter 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 [or a Government Entity] 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 3.2 For the applicability of the above mentioned entry, the following requirements need to be fulfilled: (i) The supply must be a case of supply of pure services excluding works contract service or other composite supplies involving supply of goods; (ii) Supply must be made either to Central Governmen....
X X X X Extracts X X X X
X X X X Extracts X X X X
....a Panchayat. 3.5 The Applicant has received the RFP from the Public Works Department of Government of Haryana and not from a Panchayat or Municipality. All the works of Panchayat or Municipality would be awarded by the respective Panchayat or a Municipality, which is not the case here. This fact clearly demonstrates that the Services provided or to be provided by the Applicant would not fall within the functions entrusted to a Panchayat or a Municipality under Article 243G or 243W, respectively of the Constitution of India. Hence, third requirement is not fulfilled. 4. Discussion: 4.1 In order to decide the issue at hand, the following questions require clarity; (i) What is a pure service? (ii) Whether Public Works Department (PWD), Haryana is a Government Entity? (iii) Whether the pure services received by the PWD fall under Serial No. 3 of Notification No. 12/2017 Central Tax (rate) dated 28.06.2017? 4.1.1 Although "Pure services" have not been defined under the Goods and Services Tax Act, 2017, but it is meant to mean supply of services without involving any supply of goods. Entry No. 3 of Notification 12/2017- Central Tax (rate) dated 28.0....
X X X X Extracts X X X X
X X X X Extracts X X X X
....onstitution or in relation to any function entrusted to a Municipality under Article 243W of the Constitution of India. 4.2 The functions entrusted to a Panchayat under Article 243G are:- (i) Agriculture, including agricultural extension. (ii) Land improvement, implementation of land reforms, land consolidation and soil conservation. (iii) Minor irrigation, water management and watershed development. (iv) Animal husbandry, dairying and poultry. (v) Fisheries. (vi) Social forestry and farm forestry. (vii) Minor forest produce. (viii) Small scale industries, including food processing industries. (ix) Khadi, village and cottage industries. (x) Rural housing. (xi) Drinking water. (xii) Fuel and fodder. (xiii) Roads, culverts, bridges, ferries, waterways and other means of communication. (xiv) Rural electrification, including distribution of electricity. (xv) Non-conventional energy sources. (xvi) Poverty alleviation programme. (xvii) Education, including primary and secondary schools. (xviii) Technical training and vocation....