In Re: M\/s. Telecommunication Consultants India Ltd (TCIL)
GST
2018 (11) TMI 712 – AUTHORITY FOR ADVANCE RULING, ODISHA – 2018 (19) G. S. T. L. 362 (A. A. R. – GST), [2019] 63 G S.T.R. 318 (AAR)
AUTHORITY FOR ADVANCE RULING, ODISHA – AAR
Dated:- 9-10-2018
AAR No. 03\/Odisha\/AAR\/18-19
GST
SRI ANAND SATPATHY AND SRI NILANJAN PAN, MEMBER
\nPresent for the Applicant : Sandeep Chilana, Advocate
\nSubject: GST Act, 2017-Advance Ruling U\/s 98 – Applicability of Entry No. 72 of Notification No. 12\/2017-Central Tax read with Entry No. 72 of Notification SRO No. 306\/2017-Finance Department, to the services provided by the applicant under the ICT @ School Project.
\n1.0 M\/s Telecommunication Consultants India Ltd (hereinafter referred to as the 'Applicant') assigned with GSTIN 21AAACT0061H1Z0 having registered address at TCIL Bhawan, Greater Kailash I, New Delhi-110048, have filed an application on 21.08.2018 under Section 97 of CGST Act, 2017 & OGST Act, 2017 read with <\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ng programme for which total expenditure is borne by the Central Government, State Government, Union territory administration. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n f 99924 99925 = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n re ready. the Applicant shall operate the same for imparting computer training. For this, they are required to provide one teacher having specified qualifications and experience, to each school. The teachers so appointed would utilize the available ICT infrastructure (i.e. the ITC lab so created by the Applicant) for imparting computer training to the students in accordance with the curriculum developed in this regard by the Board of Secondary Education. After the expiry of the contract period (i.e. 5 years), the entire infrastructure (supplied and installed) will be transferred to the School and Mass Education Department (SMED), Government of Odisha at zero transfer value. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ter training are to be performed by such private parties. It is a matter of fact that competitors of Applicant are also providing similar bundle of services to other State Governments under ICT in school scheme. Under such contracts all activities are to be undertaken by a single vendor and there is no possibility of performance of different activities by different vendors. This practice is being followed [Some text are missing in original PDF] industry since the introduction of ICT Projects. The perspective of [Some text are missing in original PDF] here i.e. the Government of Odisha or other state governments in [Some text are missing in original PDF] receive everything together as a bundle in all the cases. In other words [Some text are missing in original PDF] the state governments want <\/p>\n = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n remains with the Applicant. In fact, the repair and maintenance of the equipment and infrastructure is performed by the Applicant, so that it may continue to provide computer training during the contract period in a smooth manner without any obstruction. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n tion and the written submission of the Applicant). The Applicant appeared through its Advocate and the Jurisdictional Officer of State GST & the Jurisdictional Officer of Central GST appeared in person. During personal hearing, the applicant re-iterated the earlier submissions made in the application and he once again added that the ultimate service receiver is Government of Odisha (not M\/s OKCL). = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n on. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n pre-requisite of the entry whether the service provided by the applicant merits 'under any training programme'. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n mplementation of ICT project to help teachers in using smart boards and e-contents and promote e-literacy among students. Further, as forthcoming from the terms of the Contract, the intended Supplies are not just supply of Service but rather a composite supply of Goods i.e. hardware and network equipments, power equipments, maintenance of the computer hardware and network equipments and also imparting training on use of such equipments as per the syllabus prescribed by the Board of Secondary Education of Odisha. Thus, it will be incorrect to dub the entire project as a training programme. It is rather a composite supply of goods and services, not naturally but artificially bundled having distinctly separate components with distinct value attributable to each of the components. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n network equipments, up keeping of the ICT lab. telephone and internet charges, electricity charges and fuel for generator No doubt. the applicant has provided computer training service as part of the contract, but the said service is not pre-dominant or principal supply. In fact the contracted supply has three distinct supply components out of which training is a small component. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n payment for the work done is to be made by OKCL and not the state government, though the source of funding the expenditure is by the State Government. It may be profitable to refer the judgement of the Hon'ble Supreme Court in the case of CIT v. Ajax Products Ltd. (1965) 55 ITR, 741, where it is held by the Hon'ble Court that: = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" In Re: M\/s. Telecommunication Consultants India Ltd (TCIL)GST2018 (11) TMI 712 – AUTHORITY FOR ADVANCE RULING, ODISHA – 2018 (19) G. S. T. L. 362 (A. A. R. – GST), [2019] 63 G S.T.R. 318 (AAR)AUTHORITY FOR ADVANCE RULING, ODISHA – AARDated:- 9-10-2018AAR No. 03\/Odisha\/AAR\/18-19 GSTSRI ANAND SATPATHY AND SRI NILANJAN PAN, MEMBER Present for … Continue reading “In Re: M\/s. Telecommunication Consultants India Ltd (TCIL)”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-15003","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/15003","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=15003"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/15003\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=15003"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=15003"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=15003"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\nNIL
\nNIL
\nEntry No. 72 of Notification SRO No. 306\/2017-Finance Department is identical to the Entry No. 72 of Notification No. 12\/2017-Central Tax Notification bearing SRO No. 306\/2017- of Finance Department, Government of Odisha and Notification No. 12\/2017-Central Tax of Government of India have been issued u\/s 11 of the OGST Act and CGST Act respectively exempting the notified services from levy of GST. Entry SI No. 72 of the said two Notifications exempts services provided to the Central Government or any State Government or any Union Territory Administration under any training program for which the total expenditure is borne by the Central Government or State Government or Union Territory Administration. By seeking an advance ruling on the applicability of Entry 72 to the business transactions of the applicant, they implicitly seek a ruling on exemption <\/p>\n
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\n – cultural education services, cf. 999291
\n – education services provided by instructors, coaches, etc., as part of sporting activities, cf. 999292
\nThus education and training services are also included under the head 9992
\n2.0 The applicant, while filing the Application seeking the Advance Ruling, explained the facts and circumstances under which the supply order was received and how, as per their understanding, Entry 72 of Notification No. 12\/2017-Central Tax is applicable to their case. It was submitted that Odisha Madhyamik Shiksha Mission (OMSM), Government of Odisha, had mandated the Odisha Knowledge Corporation Limited (OKCL) to implement ICT project in 4000 government and government aided higher secondary schools across the State of Odisha, Accordingly, OKCL floated a tender notice on e-tendering portal of Secured e Tendering system (SeTs). The said tender was for Supply, Installation, Maintenance and Commissioning of Projection system, Interactive White Board,<\/p>\n
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\n3.0 The Applicant, in their application raised the following question to be determined by the Authority for Advance Ruling:-
\n “Whether the services provided by the Applicant to the Government and government aided higher secondary schools under the ICT Project, are covered under the scope of Entry No. 72 of Notific<\/p>\n
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\n3.4 The activities undertaken are under BOOT model basis and therefore, the ownership in the infrastructure developed by it would be transferred after the expiry of the contract period (i.e. 5 years). They stated that the details in this regard are provided in the agreement that the ownership of the entire hardware, software, other equipment etc. will be transferred at zero value at the end of the contract period and therefore, they are not engaged in the supply of goods in as much as supply of goods is taking place after the expiry of 5 years. As regards supply of goods, they submitted that even if some value is to be attributed towards supply of goods (equipment \/ infrastructure), the supply of goods here is ancillary to the princi<\/p>\n
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\n5.0 We have considered the submissions made by the applicant in their application for advance ruling as well as the submissions made by the representatives during personal hearing. We also considered the question & issues on which advance ruling is sought for by the applicant, relevant facts having bearing on the question \/ issue raised, the Applicant's understanding\/interpretation of law in respect of the issue. The Jurisdictional Officer of State GST, i.e. DCCT, Bhubaneswar III Circle stated that the facts of the present case are identical to the case already decided vide Order No.1\/Od<\/p>\n
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\n * The supply has to be a supply of Service provided to the Central Government. State Government of Union Territory [Some text are missing in original PDF]
\n * Such Service must be 'under any training program'
\n * The total expenditure of such Service is borne by the Central Government State Government or Union territory administration
\n5.3 Before taking a final view on whether Supply has been provided by the Applicant to the State Government, we examined the relevant documents and found that work order has been issued by the Odisha Knowledge Corporation Limited (OKCL) in their own capacity and the Applicant has signed agreement with OKCL on 07 10 2013 for implementation of the ICT @ school project in Government and Government aided higher secondary schools across the State of Odisha. When the contract is made between OKCL and M\/s IL & FS, it is also necessary for us to see the legal status of OKCL. From the contract\/ag<\/p>\n
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\nWe see that the applicant has entered into a contract with Odisha Knowledge Corporation Ltd. (OKCL) for implementation of the ICT @ school project in Government and Government aided higher secondary schools across the State of Odisha .The project aims to create digital literacy among students and teachers of government and government aided schools by setting ICT (Information & Communication Technology) Labs and providing manpower services to manage them for a period of five years. We also refer to Clause-8 of the agreemeni dt.07 10.2013 between the applicant and OKCL [Some text are missing in original PDF] Application which [Some text are missing in original PDF] applicant As enumerated therein, the Applicant, in fulfillment of its contractual obligations, has to prepare the s<\/p>\n
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\n5.6 We have carefully examined the submissions and documents provided by the applicant. We see that the contract is for supply, installation, maintenance and commissioning of projection system, interactive white<\/p>\n
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\n5.7 It has also been contended that during the period of contract, the infrastructure built by the Applicant remains property of the Applicant and in no case, the ownership of the infrastructure is transferred to the school or OMSM during the period of the contract. Even after the expiry of contract period, ownership of the entire infrastructure (supplied and installed) will be transferred to the School and Mass Education Department (SMED) but at zero transfer value. In the absence of consideration such transfer will not be a taxable supply. Thus, there was no supply of goods either during or after the contra<\/p>\n
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\n “In a taxing statute, one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing to be implied. One can only look at the language used. ”
\n Thus, it may be affirmed that when the language of a taxing statute is clear, if the conditions of supply falls within the four corners of statute allowing exemption, it is to be exempted. If not, tax is to be levied. No exemption can be granted by inference or analogy. No supply can be taxed or excluded from tax on the basis of intention or scheme of the Act.
\nIn view of the foregoing di<\/p>\n
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