TaxTMI 
TaxTMI 
2025 (4) TMI 419
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....y fraud or suppression of material facts or misrepresentation of facts, shall render such ruling to be void ab initio in accordance with Section 104 of the Act. 1. At the outset, we would like to make it clear that the provisions of both the Central Goods and Services Tax Act and the Tamil Nadu Goods and Services Tax Act are in pari materia and have the same provisions in like matters and differ from each other only on few specific provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Services Tax Act, 2017 would also mean a reference to the same provisions under the Tamil Nadu Goods and Services Tax Act, 2017. 2. M/s. Tiruppur City Municipal Corporation (hereinafter 'the Applicant') submitted a copy of Ledger making a debit entry vide reference No. DC3310230030813 on 09-10-2023 evidencing payment of application fees of Rs. 5,000/- each under sub-rule (1) of Rule 104 of CGST Rules 2017 and SGST Rules 2017. The online application form for advance ruling was filed on 9th Oct, 2023 and the physical application was 14th Dec, 2023 as mandated under Rule 107A. 3. Statement of relevant facts as narrated by....
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.... • As per Section 7 (2) of the CGST Act, 2017 Notwithstanding anything contained in sub-section (1),- (a) activities or transactions specified in Schedule III; or (b) such activities or transactions undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendations of the Council, shall be treated neither as a supply of goods nor a supply of services. • As per Notification No. 14/2017-CT (Rate) dated 28^th Jun, 2017, "Services by way of any activity in relation to a function entrusted to a Panchayat under Article 243G of the Constitution (or to a Municipality under Article 243W of the Constitution, is not a service". • The activity of the applicant will fall under the functions entrusted to a municipality under the Twelfth Schedule to Article 243W of the constitution under (c) Planning for economic and Social development and (q) Public amenities including street light, parking lots, bus stops and public conveniences' out of 18 functions listed under the schedule. • Similarly,....
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....he service recipient which is an exempted supply and hence refrained from ruling about the applicability of Notification. • Aggrieved with the above order of AAR, the applicant preferred appeal before the Appellate Authority of Advance Ruling. • Vide Order-in-Appeal No. AAAR/21/2021 (AR) dated 01-12-2021, AAAR ruled that the 'transaction between the Corporation and the contractor to be an activity/transaction in relation to activity/transaction undertaken by the appellant engaged as public authority and the same are covered under Notification No. 14/2017-CT (Rate) as amended. AAAR has held that the collection of Market fees daily/weekly collected for an open area through the contractors is treated as activity/transaction in relation to activity/transaction undertaken by the appellant engaged as public authority and the same is covered under Notification No. 14/2017-CT (Rate) as amended. • On the same analogy, it is opined that the same will hold good on activity of leasing of onion mandis (constructed shop/godown) to the tender contractors for the purpose of collection of fee on daily basis from the merchants/farmers/public for usage of the sh....
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....17 as amended and not chargeable to tax. 7.3. It is pertinent to mention here that on an application filed by the same applicant to this forum seeking clarification on taxability and applicability of Notification No. 14/2017-CT(Rate) dated 28-06-2017 as amended, with regard to many services including the 'collection of daily market fees through tender contractor', rendered by them in the capacity of a 'Municipality', the Appellate Authority of Advance Ruling has overruled the decision of AAR and held that the collection of daily Market fees for an open area through the contractors is treated as activity/transaction in relation to activity/transaction undertaken by the appellant engaged as public authority and the same are covered under Notification No. 14/2017-CT(Rate) as amended. 7.4. In the present application, the applicant had sought ruling on the 'right given to the contractors to collect entry fee for daily market of 19 onion mandis constructed for use by the vendors/farmers/public'. Based on the tender process, the successful bidder/contractor was awarded the contract of 'right to collect fees' by the Municipality for a period of three years, where, the contractor is a....
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....thority in which they are engaged as public authority, shall be treated neither as a supply of goods nor a supply of service, namely:- "Services by way of any activity in relation to a function entrusted to a Panchayat under article 243G of the Constitution." 2. This notification shall come into force with effect from the 1st day of July, 2017. 7.9. Though the above notification specifically mentions Panchayat', vide Notification No. 16/2018-CT(Rate) dated 26th July, 2018 the Government had made certain amendment to the above notification to include 'Municipality' also, as below. In exercise of the powers conferred by sub-section (2) of section 7 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 14/2017-Central Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 693(E), dated the 28th June, 2017, namely :- In the said notification, in the ....
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....entry of bundle/basket/bag etc., in vehicles according to the size and weight and that the entry fee for the daily market is uniform for all items of vegetables including onion. (iii) There is no separate fee/entry fee for onion. (iv) Onion being a perishable item, to have protection from rain, 19 mandis are constructed by the Municipality. (v) No separate charges are collected for storage of onions in the 19 mandis. Any farmer/person can use the mandis according to space availability and is not allotted to any person permanently. (vi) After payment of entry fees, any farmer/person can use the 19 onion mandis till the disposal/sale of onions. (vii) Each mandi measures 20x16 feet and no monthly/weekly/daily rental are collected. Entry fees is collected as per the rates fixed by the municipal corporation and receipt for entry fee is issued in the name of the corporation by the contractor. Contractor cannot collect over and above the fee fixed by the Corporation as entry fee. (viii) The Onion Mandis is for daily market usage only and no GST on the contract amount is collected and paid to the Government. 9. Going by the facts pre....