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2022 (8) TMI 810
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....GST Act and KGST/SGST Act respectively). The Applicant undertakes contract for construction of Head Works, Sumps, Pump Rooms, laying, jointing of pipe line and commissioning and maintenance of the entire work for water supply projects/ sewerage projects / 3. The applicant has sought advance ruling in respect of the following questions: i. Whether the supply of Services by the Applicant to M/s. Bangalore Water Supply and Sewerage Board is covered by Notification No.15/2021-Central Tax (Rate), dated 18th November, 2021 r/w Notification No.22/2021-Central Tax (Rate), dated 31st December 2021? ii. If the supplies as per Question 1 are covered by Notification No.15/ 2021-Central Tax (Rate), dated 18th November, 2021 r/w Notification No.22/ 2021-Central Tax (Rate), dated 31st December, 2021, then what is the applicable rate of tax under the Goods and Services Tax Act, 2017 on such supplies made w.e.f., 01-01-2022; iii. In case if the supplies as per Question 1 are not covered by the Notification supra then what is the applicable rate of tax on such supplies under the Goods and Services Tax Act, made w.e.f., 01-01-2022? 4. Admissibility of the application:....
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....in which three major Sewage Treatment Plants (STP) are constructed at Vrishabhavathi, K & C and Hebbal Valleys (major and minor). The sewerage system for newly added areas mainly the erstwhile CMC's is nearing completion. 5.6 The applicant states that Notification No.15/2021-Central Tax (Rate) seeks to amend parent Notification No.11/2017-Central Tax (Rate) dated 28th June, 2017. This Notification prescribed rate of tax on construction services at Serial No.3 of the table therein, viz-"(ii) composite supply of works contract as defined in clause 119 of section 2 of Central Goods and Services Tax Act, 2017" at 9% under CGST Act; thereby implying total GST at 18% (CGST-9% + SGST-9%); Notification 11/2017-Central Tax (Rate) dated 28th June, 2017 was subsequently amended vide Notification No.20/2017- Central Tax (Rate) dated 22nd August, 2017; whereby in Serial No.3 of the Table therein item (iii) was inserted viz-"(iii) Composite supply of works contract as defined in clause (119) of Section 2 of the Central Goods and Services Tax Act, 2017, supplied to the Government, a local authority or a Governmental authority by way of construction, erection, commissioning, installation, c....
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.... facilities such as parks, gardens, playgrounds. (m) Promotion of cultural, educational and aesthetic aspects. (n) Burials and burial grounds; cremations, cremation grounds; and electric crematoriums. (o) Cattle pounds; prevention of cruelty to animals. (p) Vital statistics including registration of births and deaths. (q) Public amenities including street lighting, parking lots, bus stops and public conveniences. (r) Regulation of slaughter houses and tanneries. Notification No.15/2021-Central Tax (Rate) dated 18th November, 2021, r/w Notification No.22/2021-Central Tax (Rate), dated 31st December, 2021 issued seeks to amend at Sr.No.3(iii) as - "Union territory or a local authority" thereby deleting the words a Governmental Authority or a Government Entity. 5.7 The applicant further submits that M/s. BWSSB is holder of PAN-AAALB0015G. The 4th character of PAN as highlighted is "L". PAN under Income Tax is designed in a Unique manner whereby the 4th character in the PAN classifies its Constitution / Status. "L" in this case denotes Local Authority. The GST Department while issuing GST REG-06 has stated as "Constitution of ....
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....DJ issued by the GST Department classifies the Contractee under Local Authority. 6.2 The applicant submits that as the Contractee of the applicant are classified as Local Authority as per the GST Authorities, they are of the opinion that - a. the said transaction is covered by Notification No.15/2021-Central Tax (Rate) dated 18th November, 2021 r/w. Notification No.22/2021-Central Tax (Rate), dated 31st December, 2021; which after amendment now reads as "(iii) composite supply of works contract as defined in clause (119) of Section 2 of the Central Goods and Services Tax Act, 2017, supplied to Central Government, State Government, Union Territory or a local authority"; b. the said transaction is liable to tax under the GST Act @ 12%; and c. Not applicable PERSONAL HEARING / PROCEEDINGS HELD ON 07-07-2022 7. Shri Manish Goel, Chartered Accountant and Duly Authorised Representative appeared for personal hearing proceedings held on 07-07-2022 and reiterated the facts narrated in their application. FINDINGS & DISCUSSION 8. At the outset we would like to make it clear that the provisions of CGST Act, 2017 and the KGST Act, 2017 are in pari-mater....
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....or (iii) sewerage treatment or disposal. 6 Since the Applicant has been awarded a contract work of Rehabilitation/Remodeling/Replacement of sewer line, the same may be covered under entry 3 (iii)(c) mentioned supra. Before deciding on the same we need to find out whether BWSSB is a State Government or local authority or Governmental Authority or Government Entity. If the Applicant is any one of these then only the Entry No.3(iii) of Notification No.11/2017-Central Tax (Rate) dated 28.06.2017 will be applicable to the applicant. 13. Since the BWSSB is a Board set up by The Bangalore Water Supply and Sewerage Act, 1964, the same cannot be considered as State Government. Now let us discuss whether BWSSB is a Local Authority or not. Subsection 69 of section 2 of CGST Act s Local Authority as below: Section 2. Definitions.- In this Act, unless the context otherwise requires,- ......................... ......................... (69) 'local authority" means- (a) a "Panchayat" as defined in clause (d) of article 243 of the Constitution; (b) a "Municipality" as defined in clause (e) of article 243P of the Constituti....
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....of this Part: Provided that a Municipality under this clause may not be constituted in such urban area or part thereof as the Governor may, having regard to the size of the area and the municipal services being provided or proposed to be provided by an industrial establishment in that area and such other factors as he may deem fit, by public notification, specify to be an industrial township As per Clause (e) of Article 243 and Article 243Q of Indian Constitution, we can say that Municipality is an institution of self-government at transitional area, smaller and larger urban areas. 13.3 From the definitions of Panchayat and Municipalities we can see that both are institutions of self-government in defined areas. Self-Government is the management of local affairs by local Authorities, members of which have been elected by the local people. One of the distinctive attributes and characteristics of Local Authority is that, their members are elected through direct elections by the inhabitants of the defined area. But as per the section 3 of BWSSB Act 1964, all the members of BWSSB are appointed by the State Government. 13.4 BWSSB is also not a Municipal Committee or a ....
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....12 supra and hence the same is exigible to GST at 12% till 31.12.2021. 16. Notification No.22/2021-Central Tax (Rate), dated 31.12.2021 was issued in supersession of Notification No.15/2021-Central Tax (Rate), dated 18.11.2021 which brought amendment to No.11/2017-Central Tax (Rate) dated 28.06,2017 as below: In the said notification, in the TABLE, against serial number 3,- 1) in column (3), in the heading "Description of Service", in items (iii),(vi),(ix) and (x), for the words "Union territory, a local authority, a Governmental Authority or a Government Entity" the words "Union territory or a local Authority" shall be substituted; 2) in column (3), in the heading "Description of Service", in item (vii), for the words "Union territory, local authority, a Governmental Authority or a Government Entity" the words "Union territory or a local authority" shall be substituted; 3) in column (5), in the heading "Condition", the entries against items (iii),(vi),(vii),(ix) and (x), shall be omitted. In view of the above notification, Entry No. 3(iii) of Notification No.11/2017-Central Tax (Rate) dated 28.06.2017 is amended as below with effect from 01.01.2....