Works contract executed by an applicant cannot be termed as other than commercial/business purposes therefore, the benefit of Concessional Rate of 12% is not applicable to the services supplied by the applicant. The services supplied by the applicant are subjected to 18%
Rate of tax (service)— In the instant case, applicant seeks Advance Ruling in respect of the following issues;
1. (a) Whether in the terms and conditions of the following contracts that the applicant entered into with the contractee therein, the ‘supply of service’ involved therein would amounts to a supply to Government, Government Agency or Government Entity in terms of the Notification No.20 dated:22.08.2017, Notification No. 32, dated:13.10.2017?
(b) What would be the norms to decide a contractee is Government/ Government Agency/Entity?
Description of the contracts being done to Telangana Power Distribution Corporations (DISCOMS)
(i) HVDS- High Voltage Distribution Systems in Suryapet
(ii) Capacitor Bank Works in Nalgonda etc.
2. When the Contractee gets funds/grants from Central or State Government for given work, can it be called as work being done to a Government/ Government Agency/Entity? In this situation can the work be called as non-commercial?
3. Whether all these contractees shall basically be Government/Agencies/ Entity or is there any possibility in a particular work it can be said that a contractee is of this kind?
4. In respect of HVDS to Agriculture Section, the State Government reimburses the money for agriculture service (i.e.. reimbursement to TSSPDCL (Electricity Consumption)-In this situation, whether the supply by the applicant would amount to a supply to Govt/Govt. Agency/Entity?
5. Whether TSSPDCL falls under the definition of Government Authority/ Government Entity as defined in Notification No. 31/13-10-2017 Central Tax (Rate) and other connected Notifications?
6. What is the applicable rate of tax on the works executed to TSSPDCL mentioned in above?
Held that— The Applicant is not entitled for the benefit of concessional rate of GST @12 % (6% CGST + 6% SGST) in respect of the works quoted in his application in terms of Not. No. 11/2017-CT (R) dated 28.06.2017 amended by Not. Nos. 20/2017-CT(R) dated 22.08.2017, 24/2017-CT (R) dated 21.09.2017 and Not. No. 31/2017-CT (R) dated 13.10.2017 etc. or any other concessional rate.
Whether a particular person is a Governmental authority or a Governmental Entity is to be decided in terms of the definition adduced under Not. No. 11/2017-CT (R) dated 28.06.2017 (as amended) by applying the facts of each case.
The impugned works are used commercial/business activities in view of the facts and circumstances as discussed above and accordingly the same are taxable under GST.
The applicable rate of tax is 18% (9% CGST + 9% SGST) for the services referred to by the Applicant.
Works contract executed by an applicant cannot be termed as other than commercial/business purposes therefore, the benefit of Concessional Rate of 12% is not applicable to the services supplied by the applicant. The services supplied by the applicant are subjected to 18%
Rate of tax (service)— In the instant case, applicant seeks Advance Ruling in respect of the following issues;
1. (a) Whether in the terms and conditions of the following contracts that the applicant entered into with the contractee therein, the ‘supply of service’ involved therein would amounts to a supply to Government, Government Agency or Government Entity in terms of the Notification No.20 dated:22.08.2017, Notification No. 32, dated:13.10.2017?
(b) What would be the norms to decide a contractee is Government/ Government Agency/Entity?
Description of the contracts being done to Telangana Power Distribution Corporations (DISCOMS)
(i) HVDS- High Voltage Distribution Systems in Suryapet
(ii) Capacitor Bank Works in Nalgonda etc.
2. When the Contractee gets funds/grants from Central or State Government for given work, can it be called as work being done to a Government/ Government Agency/Entity? In this situation can the work be called as non-commercial?
3. Whether all these contractees shall basically be Government/Agencies/ Entity or is there any possibility in a particular work it can be said that a contractee is of this kind?
4. In respect of HVDS to Agriculture Section, the State Government reimburses the money for agriculture service (i.e.. reimbursement to TSSPDCL (Electricity Consumption)-In this situation, whether the supply by the applicant would amount to a supply to Govt/Govt. Agency/Entity?
5. Whether TSSPDCL falls under the definition of Government Authority/ Government Entity as defined in Notification No. 31/13-10-2017 Central Tax (Rate) and other connected Notifications?
6. What is the applicable rate of tax on the works executed to TSSPDCL mentioned in above?
Held that— The Applicant is not entitled for the benefit of concessional rate of GST @12 % (6% CGST + 6% SGST) in respect of the works quoted in his application in terms of Not. No. 11/2017-CT (R) dated 28.06.2017 amended by Not. Nos. 20/2017-CT(R) dated 22.08.2017, 24/2017-CT (R) dated 21.09.2017 and Not. No. 31/2017-CT (R) dated 13.10.2017 etc. or any other concessional rate.
Whether a particular person is a Governmental authority or a Governmental Entity is to be decided in terms of the definition adduced under Not. No. 11/2017-CT (R) dated 28.06.2017 (as amended) by applying the facts of each case.
The impugned works are used commercial/business activities in view of the facts and circumstances as discussed above and accordingly the same are taxable under GST.
The applicable rate of tax is 18% (9% CGST + 9% SGST) for the services referred to by the Applicant.