AI Drafter 
TaxTMI 
TaxTMI 
2026 (1) TMI 311
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.... units and service divisions across the State, and maintains a liaison office at Trivandrum. 3.2 SILK operates as a government accredited agency for the execution of civil, structural and electro mechanical projects in the capacity of a Project Management Consultant (PMC). In addition to its consultancy role, SILK also provides a wide range of services and products, including fabrication, casting, ship building, ship breaking and the manufacture of hospital and home furniture. 3.3 SILK undertook various PMC assignments for client agencies including the Local Self Government Department (LSGD), Scheduled Tribes Development Department (STDD), Kannur District Panchayath, Forest Department and multiple Grama Panchayaths. Some of the projects involved were PMC for installation and repair of Mini and High Mast Lamps for Grama Panchayaths; and development of a Rapid Response Team (RRT) and a Veterinary Emergency Team (VET) at Olavakkode in the Palakkad Forest Division, executed pursuant to a tripartite agreement between the Divisional Forest Officer (DFO), Palakkad, SILK and the project contractor. 3.4 As part of the consideration for the PMC services, SILK collected "centage char....
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....within the scope of functions listed in the 12th Schedule, and are therefore covered under Article 243W. On this basis, the applicant contends that the activity qualifies as pure services provided to Government in relation to constitutionally assigned functions, and is exempt from GST under Serial No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, read with SRO No. 371/2017. 4.5 Additionally, the applicant submits that the GST amount of Rs. 1.91 Lakhs paid earlier on such services was not legally required and resulted only due to an erroneous application of tax law. It is stated that subsequent audit objections and departmental communications have led to refund related disputes. 4.6 Accordingly, the applicant contends that since the underlying supply is non-taxable/exempt, the GST paid on centage charges was erroneously paid without any tax liability, and therefore the two year limitation prescribed under Section 54 of the CGST Act, 2017 for filing refund claims is not applicable. On this basis, SILK submits that it should be permitted to claim refund of GST already collected/paid on such centage charges for the financial year 2017-18 onwards. 4.7 In su....
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....as consideration for the consultancy and project management services rendered. 7.3 In addition to consultancy, the applicant also has manufacturing units and is engaged in activities such as fabrication, casting, ship building/breaking, and the manufacture of hospital and home furniture. However, the present application is confined exclusively to the taxability of 'centage charges' collected in respect of PMC services. 7.4 The main issue under consideration is whether the 'centage charges' collected for the PMC services described in para 7.2 are liable to GST, or whether they fall under the exemption available for 'pure services' under Entry No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. Further, it needs to be determined whether the applicant is eligible to seek refund of the GST already paid on such centage charges for the period from 2017-18 onwards. 7.5 Now Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 provides details of exemptions on supply of services. Entry no. 3 of the said notification is reproduced as under; Sl.No. Chapter, Section, Heading, Group or Service Code (Tariff) Description of Serv....
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....e Local Self Government Department (LSGD) is a Department of the State Government responsible for the supervision and administration of local self-government institutions within the State. (b) The Scheduled Tribes Development Department (STDD) is a Department of the State Government of Kerala entrusted with the planning, implementation and monitoring of welfare schemes and development programmes for Scheduled Tribes. (c) The Kerala Forest Department is a Department of the State Government responsible for protection and conservation of forests, wildlife and biodiversity. (d) Gram Panchayaths and District Panchayaths are rural local bodies established under Part IX of the Constitution and fall within the statutory definition of "local authority" under Section 2(69) of the CGST Act. 7.7.4 Accordingly, the organisations to whom the applicant has rendered services are either State Government Departments (LSGD, STDD, Forest Department) or Local Authorities (District Panchayaths, Grama Panchayaths), and therefore fall squarely within the categories specified in Entry No. 3 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. 7.8.1 The functions covered under the....
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....es and facilities such as parks, gardens, playgrounds 13. Promotion of cultural, educational and aesthetic aspects 14. Burials and burial grounds; cremations, cremation grounds; and electric crematoriums 15. Cattle pounds; prevention of cruelty to animals 16. Vital statistics including registration of births and deaths 17. Public amenities including street lighting, parking lots, bus stops and public conveniences 18 Regulation of slaughter houses and tanneries 7.8.3 (a) The Forest Department falls within the scope of "Urban forestry, protection of the environment and promotion of ecological aspects," which is one of the functions listed under the Twelfth Schedule and therefore comes within the purview of Article 243W of the Constitution. (b) The Scheduled Tribes Development Department (STDD) falls under the function of "Welfare of the weaker sections, and in particular, of the Scheduled Castes and the Scheduled Tribes," which is included in the Eleventh Schedule and therefore relates to Article 243G of the Constitution. (c) Similarly, the functions carried out by various District Panchayaths and Grama Panchayaths are ac....