2018 (11) TMI 57 – AUTHORITY FOR ADVANCE RULING, MADHYA PRADESH – 2018 (19) G. S. T. L. 107 (A. A. R. – GST) – Levy of GST – Work contract services received from vendors for supply and erection work under various projects – whether clause(vi)(a) of Sr. No. 3 of table of Notification No. 11/2017-Central Tax(Rate) dated the 28th June, 2017 is applicable on the works contract services received by it?
–
Held that:- The Government of Madhya Pradesh is having full control over the applicant M/s. M.P. Poorv Kshetra Vidyut Vitran Co. Ltd. and the applicant is covered under the definition of Government Entity – The projects are undertaken for construction of electricity distribution lines, sub-stations and other infrastructure which are meant predominately for sell of electricity in urban and/or rural area.
–
The projects under DDUGY, IPDS, ADB, SSTD, Saubhagya Yojna, FSP and all other schemes of governments are carried out for business purpose and the benefit of Concessional Rate of 1
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
7 as amended from time to time and corresponding notifications under and MPGST Act, 2017, the applicable rate of tax is 18% (9% under Central tax and 9% State tax).
–
Ruling:- The Applicant is not entitled for the benefit of concessional rate of GST @12% (6% under Central tax and 6% State tax) for the said projects in terms of Notification No.24/2017-Central Tax (Rate) dated 21.09.2017 read with Notification No.31/2017-Central Tax (Rate) dated 13.10.2017.
–
The applicable rate of tax is 18% (9% under Central tax and 9% State tax). – Case No. 17/2018 Order No. 17/2018 Dated:- 18-9-2018 – RAJIV AGRAWAL AND MANOJ KUMAR CHOUBEY, MEMBER Present on behalf of applicant Shree Anil Kumar, Authorized Representative PROCEEDINGS (Under section 98 of Central Goods and Services Tax Act, 2017 and the Madhya Pradesh Goods and Services Tax Act, 2017) 1. The present application has been filed u/s 97 of the Central Goods & Services Tax Act, 2017 and MP Goods & Services Tax Act, 2017 (her
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
ices from vendors for supply and erection work under various projects. 3.3. The Applicant cites Applicability of clause (vi)(a) of Sr. No. 3 of table of Notification No. 11/2017-Central Tax(Rate) dated the 28th June, 2017 for applicability of rate of tax on the works contract services received by it. 4. QUESTION RAISED BEFORE THE AUTHORITY – The applicant wishes to know whether clause(vi)(a) of Sr. No. 3 of table of Notification No. 11/2017-Central Tax(Rate) dated the 28th June, 2017 is applicable on the works contract services received by it. and determination of liability to pay Tax. 5. DEPARTMENT'S VIEW POINT- The concerned officer submitted that the nature of works contract undertaken by the applicant doesn't come under the category for which the notified rate of tax is 12% (6% CGST and 6% SGST) but it will attract 18% (9% CGST and 9% SGST). 6. RECORD OF PERSONAL HEARING-Shree Anil Kumar, Authorized Representative Appeared for personal hearing on 11.09.18 and they reiterate
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
fications is issued by the Government of India to amend for this purpose. The said amendment Notification is as follows – 1) Notification No. – 20/2017-Central Tax (Rate), Dated – 22/08/2017. 2) Notification No. – 24/2017-Central Tax (Rate), Dated – 21/09/2017. 3) Notification No. – 31/2017-Central Tax (Rate), Dated – 13/10/2017. 4) Notification No. – 46/2017-Central Tax (Rate), Dated – 14/11/2017. 5) Notification No. – 01/2018-Central Tax (Rate), Dated – 25/01/2018. 6.6 Vide notification no. 24/2017 – Central Tax (Rate), Dated – 21/09/2017, Government of India by inserting entry no. (vi) notified concessional GST rate of 6% for the construction services provided to Central Government, State Government, Union Territory, a local authority or a governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of – a) a civil structure or any other original works meant predominantly for use other t
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
t or State Legislature; or ii) established by any Government, with 90per cent. or more participation by way of equity or control, to carry out a function entrusted by the Central Government, State Government, Union Territory or a local authority. . 6.8 In view of above, it is submitted that the provisions referred above issued under the Notification No. 24/2017 – Central Tax (Rate), Dated – 21/09/2017 and Notification No. – 31/2017 – Central Tax (Rate), Dated – 13/10/2017 is applicable on the Company. 7. DISCUSSIONS AND FINDINGS: 7.1. First of all we must look in the contention that the Applicant is a government entity or not. As per Notification No. 31/2017 – Central Tax (Rate), Dated 13/10/2017 issued under CGST Act, 2017 and corresponding notification under MPGST Act, 2017. Government Entity is defined as under – Government Entity means an authority or a board or any other body including a society, trust, corporation, i) set up by an Act of Parliament or State Legislature; or ii) es
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
opal. 7.5. Thus, based on the above facts, it is concluded that the Government of Madhya Pradesh is having full control over the applicant M/s. M.P. Poorv Kshetra Vidyut Vitran Co. Ltd. and the applicant is covered under the definition of Government Entity. 7.6. Now it is important to discuss the nature of work undertaken by the applicant. The Applicant is entrusted for various ambitious projects of Central and State Government relating to strengthening of power distribution network and Rural Electrification for public welfare such as Deendayal Upadhyay Gram Jyoti Yojna for Rural Electrification (DDUGJY), Integrated Power Development Scheme (IPDS), Saubhagya Yojna, ADB funded project, Scheme for Strengthening of Transmission and Distribution systems (SSTD) projects, feeder separation project (FSP) etc., the work has been carried out with the help of Contractor and work include both supply of material and erection of the same. 7.7. The projects are undertaken for construction of electri
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
DS, ADB, SSTD, Saubhagya Yojna, FSP and all other schemes of governments are carried out for business purpose and the benefit of Concessional Rate of 12% (6% under Central tax and 6% State tax) as per notification under is not available to the applicant on works pertaining to construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration, which are carried out in respect of projects under DDUGY, IPDS, ADB, SSTD, Saubhagya Yojna, FSP and all other schemes of governments as the same is undertaken for the business purpose. Further, as per Section 2 of CGST Act '2017 and MPGST Act, 2017 defines works contract as 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 other form) is involved in the execu
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =