TaxTMI 
TaxTMI 
2022 (7) TMI 749
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....e would like to make it clear that the provisions of both the CGST Act and the OGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the OGST Act. 3.0 Questions for advance ruling before the AAR, Odisha. a) The Authority for Advance Ruling vide its Order No 07/0DISHA-AAR/2020-21 dated 09.03.2021 held that Steel Authority of India Ltd. (SAIL) is a Government Entity and the construction work of ISPAT POST- GRADUATE MEDICAL INSTITUTE AND SUPER SPECIALLY HOSPITAL, at Rourkela is a work entrusted by Central Government; to SAIL, therefore M/s URC Construction (P) Ltd. executing the work under the Letter of Award between the Applicant and M/s URC Construction (P) Ltd. is leviable to a tax rate @ 6% each on Central GST and SGST. Therefore, the Applicant being the Principal Contractor, whether the tax rate applicable to value of contract between the Applicant and M/s SAIL is also leviable at 12% [CGST @ 6% + SGST @ 6%] in terms of Entry no 3(vi) (a)or (b) of Notification No. 11/2017-Central Tax (Rate), dated 23-6-2017? b) Where....
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....Authority for Advance Ruling,(AAR) Odisha seeking a Ruling on the applicable rate of tax on the above referred work undertaken by it. It was further informed that the said Ruling held as under: "The rate of GST on supply of works contract service which is being supplied to M/s SAIL, Rkl for construction of ISPAT Post Graduate Medical Institute and Super Specialty Hospital would merit entitlement for concessional rate of GST @ 12% [CGST @ 6% + SGST @6%] in terms of Notification No. 11/2017-Central Tax (Rate), dated 28-06-2017 (and as amended)" 4.5 The Applicant has submitted that consequential to the ruling of AAR, Odisha M/s URC Construction (P) Ltd. issued credit note in order to revise the tax component in the Tax Invoices so raised earlier by reducing the tax rate from 18 % to 12 %. It was also advised that in view of the above referred ruling, the Applicant has to accept the revised invoices with reduction of tax component as a recipient of service of the underlying subject Contract. Nevertheless. the Applicant had already raised Tax Invoices on M/s SAIL by charging tax rate of 18% and also have paid the same through its monthly GST Returns. This has resulted in a situation ....
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....Hence, it is submitted that the instant supply is a 'Composite Supply of Works Contract Service' provided or to be provided in relation to construction of civil structure meant predominantly for use as a clinical establishment. 4.8 The Applicant has submitted that the legal status of M/s SAIL has already been held as Government Entity vide the earlier Order of advance ruling pronounced by this Bench; and whereas the Entry at SI. No.3 (vi) of the Notification No. 11/2017- Central Tax (Rate) dated 28.06.2017 specifically provides that the Composite Supply is to be made to a Government Entity. Thereby, the second pre-requisite is full-filled to merit classification under serial no. 3 (vi) (a) or (b) of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017. as amended from time to time. 4.9 As regards to the last pre-requisites that "If the services provided to Government Entity, then the services shall be procured by the Government Entity in relation to a work entrusted to it by the Central Government, State Government, Union territory or local authority", the Applicant inter alia stated that the Hon'ble Bench, (AAR, Odisha) in its Order No. 07/ODISHA-AAR/2020-21 ....
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.... Government Entity i.e. M/s. SAIL, Rourkela for construction of ISPAT Post Graduate Medical Institute and Super Specialty Hospital and accordingly the same would merit entitlement for concessional rate of GST @ 12% [CGST @ 6% + SGST @ 6%] in terms of Notification No. 11/2017-Central Tax (Rate), dated 28-6-2017 (as amended). 6.3 In their submission, the Applicant has contended that their supply would merit classification under serial no. 3 (vi) (a) or (b) of Notification No.11/2017-Central Tax (Rate) dated 28.06.2017, as amended from time to time. For deciding the issue, it is necessary to examine the relevant entry of the said notification. The relevant entry reads as under. SI.No. Chapter, Section or Heading Description of Service Rate (%) Condition (1) (2) (3) (4) (5) 3 (vi) Heading 9954 (Construction services) (vi) Services provided to the Central Government, State Government, Territory, a local authority, a Governmental Authority or a Government Entity by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of- (a) civil structure or any other original works meant predominantly for us....
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....e as a clinical establishment. Though the term "clinical establishment" has not been defined under the GST laws but under the erstwhile Service Tax Laws, the same was defined vide Notification No. 25/2012 dated 20.06.2012. The said definition is reproduced herein below for ease of reference: "Clinical Establishment" means a hospital, nursing home, clinic, sanatorium or any other institution by, whatever name called, that offers services or facilities requiring diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognized system of medicines in India, or a place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases. 6.6 Before taking a view on whether the instant Supply under discussion is 'Composite supply of works contract', we need to go through the definition of 'works contract' as has been defined under Section 2(119) of the CGST Act, 2017. The term "works contract" has been defined to mean a contract for building, construction, fabrication, completion, erection. installation, fitting out, improvement, modification, repair, maintenance, renov....
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....ified exemption is satisfied/ful-filled. 6.7 Coming to the second pre-requisite of the entry whether the Services are provided to Central Government, State Government, Union Territory, a local authority, Governmental Authority or Government Entity, the Applicant contended that their supply is being made to M/s SAIL which is a Government Entity. In support of this stand, the Applicant has referred to the Ruling of AAR, Odisha Order No. 07/ODISHA-AAR/2020-21 dated 09.03.2021 in the case of M/s URC Construction (P) Ltd. The Applicant also contended that the legal status of M/s SAIL has already been held as 'Government Entity' in the aforesaid Ruling dated 09.03.2021. Even after lapse of substantial time, the Applicant did not submit any document substantiating his claim. except referring to the aforesaid ruling of this forum in the case of M/s URC Construction (P) Ltd. 6.8 As the Applicant has referred to the Ruling of the AAR, Odisha vide Order No.07/0DISHA-AAR/2020-21 dated 09.03.2021 in the case of M/s URC Construction (P) Ltd regarding the eligibility of M/s SAIL, RSP as a "Government Entity", we would like to reproduce the relevant portion of the said order as under. ....
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....plied to M/s SAIL, Rourkela, the Applicant stated that construction of medical institute and super specialty hospital is undertaken on account of the Central Government's initiative and is completely a central government funded project. In this regard, they have submitted following documents. (a) Relevant extract of the Budget Estimate of Ministry of Steel, Government of India, for the F.Y. 2020-21 which reflects actual fund spent of Rs.105.75 Crores for the F.Y. 2018-19, estimated fund of Rs.144.83 Crores for F.Y. 2019-20 and Rs.44.24 Crores for F.Y. 2020-21 for upgradation of Ispat General Hospital Rourkela to a Super Specialty Hospital. (b) Relevant extract of the SAIL'S annual report for the F.Y. 2018-19 wherein it had been provided that the Central Government grant of 105.75 crore was received during 2018-19 against sanctioned budgetary provision of 295.79 crore for the purpose of upgradation of Ispat General Hospital, Rourkela to a Super Speciality Hospital (c) Monthly Summary of the Cabinet, Ministry of Steel, Government of India, for the month of June 2018 and provides that the project would fulfil the medical requirement of the people of Rourkela and neighbor....