Classification of service— In the instant case, the applicant seeks advance ruling on the following issue—
1. Whether the service recipient i.e. M/s. Jaipur Smart City Limited is a "Governmental Authority" as defined in the explanation to clause (16) of section 2 of the IGST Act, 2017.
2. Whether Item number (vi) in Column (3) of serial number 3 of Notification No. 11/2017 - Central Tax (Rate) dated 28.06.2017 as amended by Notification No. 24/2017- Central Tax (Rate) dated 21.09.2017 is applicable in respect of all payments related to work order for Fire Fighting System installation at contracted area between applicant and Jaipur Smart City Limited?
3. What will be the GST rate for the work undertaken by applicant for M/s Jaipur Smart City Limited under Bid Reference no. JSCL/Works/02/2020-21?
4. Whether the Applicant is liable to pay GST under RCM in respect of road cutting charges paid by them to Jaipur Nagar Nigam (JNN) on behalf of M/s. Jaipur Smart City Limited in relation to such contract? If the answer to the same is in affirmative, What will be the GST rate for such payment under RCM?
5. Whether recovery of such road cutting charges by the Applicant from M/s. Jaipur Smart City Limited liable to GST? If the answer is in affirmative, what will be the GST rate?
The Applicant i.e. M/s Lakhlan & Qureshi Construction Company is a civil contractor which awarded the work of installation of "Fire fighting system with pump house in ABD Area & Purohit ji ka Katia, including 5 years Operation &Maintenance" in Jaipur city by the M/s Jaipur Smart City Limited ("JSCL"). As per Notice to proceed (NOP), the project commencement and completion dates are 08.03.2021 and 07.02.2022 respectively. The project would involve design, erection, installation, operation and maintenance of the Fire Fighting system.
Held that—
1. No, M/s Jaipur Smart City Limited is not a "Governmental Authority".
2. Item number (vi) in Column (3) of serial number 3 of Notification No. 11/2017 - Central Tax (Rate) dated 28.06.2017 as amended by Notification No. 24/2017- Central Tax (Rate) dated 21.09.2017is not applicable in respect of all payments related to work order for Fire Fighting System installation at contracted area between applicant and Jaipur Smart City Limited
3. The services provided by the applicant will be covered under Item number (xii) in Column (3) of serial number 3 of Notification No. 11/2017 - Central Tax (Rate) dated 28.06.2017 as amended time to time and attracts GST @18%
4. the Applicant is liable to pay GST under RCM in respect of road cutting charges paid by them to Jaipur Nagar Nigam (JNN) on behalf of M/s. Jaipur Smart City Limited (JSCL) under Section 9 of CGST Act, 2017 read with No. 5 of the Notification No. 13/2017-CT(R) dated 28.06.2017 & No. 9 of the Notification No. 12/2017-CT(R) dated 28.06.2017.
5. As M/s JSCL is not a governmental authority therefore, serial number 3 of Notification No. 12/2017 of central tax (rate) dated 28th June 2017 as amended by Notification No. 02/2018 of central tax (rate) dated 25th January 2018 is not applicable on applicant. Further, as per clause (c) of sub section (2) of Section 15 of CGST Act, 2017, recovery of such road cutting charges by the Applicant from M/s. Jaipur Smart City Limited will be included in the value of supply under GST as the applicant is not qualified as a pure agent in the instant case. Thus, the applicant is liable to pay GST @18%