2018 (9) TMI 546 – AUTHORITY FOR ADVANCE RULING MADHYA PRADESH – 2018 (16) G. S. T. L. 163 (A. A. R. – GST) – Classification of Services – Construction, Erection, Commissioning and Installation of projects – Electrical Transmission Lines, Sub-Stations and Line Shifting – service of construction of new 33/220 kV Pooling Sub-station along with associated 220 kV DCDS Transmission Line and associated feeder bay work on total Turnkey basis under World Bank Financing – rate of CGST and SGST on the supply being made under the contract.
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Held that:- On a reading of the scope of work, it is clear that the work involves both supply of goods and supply of services, which are naturally bundled. Accordingly, under this agreement, the applicant is providing a composite supply within the meaning of Section 2 of the CGST Act, 2017 – The HSN Code for the supply of composite service in the nature of Work Contract under the all the three agreements entered into with RUMS, shall be 9954/995423 – Und
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d u/s. 97 of the Central Goods & Services Tax Act, 2017 and MP Goods & Services Tax Act, 2017 (hereinafter also referred to CGST Act and MPSGT Act respectively) by Vihan Enterprises (hereinafter also referred to as applicant), registered under the Goods Services Tax. 2. The provisions of the CGST Act and MPGST Act are identical, except for certain provisions. Therefore, unless a specific mention of the dissimilar pro-vision is made, a reference to the CGST Act would also mean a reference to the same provision under the MPGST Act. Further, henceforth, for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST or MPGST Act would be mentioned as being under the GST Act. 3. Facts of the case as per the Applicant: 3.1 The applicant is engaged, inter alia, in Construction, Erection, Commissioning and Installation of projects relating to Electrical Transmission Lines, Sub-Stations and Line Shifting. 3.2 Rewa Ultra Mega Solar Limited (hereinafter re
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under World Bank Financing. 3.4 Under the agreements with the RUMS, the scope of work involves supply of all Transmission Line material and sub-station Equipments (excluding Power Transformers, its associated accessories and oil), Station Transformers, Fabricated, Galvanized sub-station Structures and other materials, with related civil works, erection work and testing/commissioning for construction of new 33/220 kV pooling sub-stations, transmission lines and feeder bay work on total Turnkey basis. The scope of the contract also involves construction of 33/220kV pooling sub-station, Transmission Lines and Feeder Bay Work. 3.5 The contract allotted to Vihan Enterprises is for a work which is part of evacuation infrastructure being exclusively for Solar Power, for a Solar Park and is being developed by Solar Project Park Developer. 3.6 The contracts in question were entered into by RUMS and the applicant prior to the introduction of GST. The rates quoted by the applicant for the contrac
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Bid Identification No. RUMS/2016-17/372/014 (Lot – III) under World Bank Financing shall fall? (iv) What shall be the applicable rate of CGST and SGST on the supply being made under the contract? 5. Record of personal hearing – The matter was taken up for hearing on 8-6-2018 where CA Sandeep Mukherjee attended the hearing for the Applicant. He submitted copies of the letters written by RUMS to the Applicant and MP Power Transmission Co. Limited and requested that the documents be taken into record and reiterated their submissions made in the application. 6. Discussing and findings : 6.1 The application, it was stated by the applicant that as per RUMS, the rate of GST should be 5% since the work is part of evacuation infrastructure being exclusively for Solar Power, for a Solar Park and is being developed by Solar Project Park Developer. Also, as per the letter written to the applicant by RUMS, submitted during the course of the hearing, RUMS has agreed to pay CST @ 5% to applicant til
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comes to 18%. 6.4 We have perused the contents of the agreement between the applicant and RUMS, more specifically the scope of work in the agreement at para 4 of the agreement. On a reading of the scope of work, it is clear that the work involves both supply of goods and supply of services, which are naturally bundled. Accordingly, under this agreement, the applicant is providing a composite supply within the meaning of Section 2 of the CGST Act, 2017. 6.5 The agreement involves construction of. Pooling sub-station on Turnkey Basis and falls under the definition of a "Works Contract" within the meaning of Section 2 of the CGST Act, 2017. The definition is as under: "works contract" means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some
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Headings 84 and 85, as given in Sl. No. 234 of Schedule-I of Notification No. 1/2017-Central Tax (Rates) is for supply of goods. The relevant para of the Notification is as under: "G.S.R. (E). – In exercise of the powers conferred by sub-section (1) of Section 9 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby notifies the rate of the Central Tax of – (i) 2.5 per cent, in respect of goods specified in Schedule-I, (ii) 6 per cent, in respect of goods specified in Schedule-II, (iii) 9 per cent, in respect of goods specified in Schedule-III, (iv) 14 per cent, in respect of goods specified in Schedule-IV, (v) 1.5 per cent, in respect of goods specified in Schedule-V, and (vi) 0.125 per cent, in respect of goods specified in Schedule-VI. appended to this notification (hereinafter referred to as the said Schedules), that shall be levied on intra-State supplies of goods, the description of which is specifi
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; Services Tax Act, 2017, involving predominantly earth work (that is, constituting more than 75% of the value of the works contract) provided to the CG, SG, UT, local authority, a Governmental authority or a Government entity. b. Under para 3, clause (x) for Composite supply of works contract as defined in clause (119) of Section 2 of the CGST Act, 2017 provided by a sub-contractor to the main contractor providing services specified in item (vii) above to the CG, SG, UT, a local authority, a Governmental Authority or a Government Entity. c. Under para 3, clause (xi) for Services by way of house-keeping, such as plumbing, carpenting, etc. where the person supplying such service through electronic commerce operator is not liable for registration under sub-section (1) of Section 22 of the CGST Act, 2017. None of the above activities are contemplated in the scope of work under the agreement entered into by the applicant with RUMS. 6.9 It is notable that under the CGST and SGST Acts, Rules
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