GST
TRT-2025-
AAR West Bengal
Date:-21-10-22
In:-
Issue Favourable to Tax Payer ?:-
Order date – 21 October 2022
Facts –
- The Applicant, Banchu Das, engaged in providing conservancy/solid waste management services to the Conservancy Department of the Howrah Municipal Corporation (HMC) under the trade name of PEAU TRANSPORT.
- The applicant submits that they are proving services as “ Pure service” under the Notification No.12/2017– Central Tax (Rate) dated 28/06/2017, as amended, which exempts “pure service” ( excluding works contract service or other composite supplies involving supply of any goods) provided to the Central Government, State Government or Union Territory or Local Authority or a Government Authority or a Governmental Entity by way of an activity in relation to any function entrusted to a Panchayat under Article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution.
Issue –
- Whether conservancy/solid waste management services provided by us is exempt from GST?
Order –
- The AAR observed the work order issued by the Conservancy Department of Howrah Municipal Corporation describes the nature of the work for annual operation and maintenance of capacity portable compactor and hook loader.
- The AAR also observed in respect to exemption of pure service and held that the work order has been issued for operation and maintenance of compactor and hook loader. Annual maintenance of compactor and hook loader involves supply of goods like spare parts. Therefore, the instant supply is not of pure services.
- However, AAR also finds that as per sl no.3A of the said Notification supply for annual operation and maintenance of compactor and hook loader is a composite supply of goods and services and such supply can qualify for exemption under the notification only when the value of goods involved in such composite supply does not exceed 25% of the value of supply and the same is provided to the Central Government, State Government or Union territory or local authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution.
- It also finds that as per the article 243W of the Constitution of India functions entrusted to a municipality as listed in the Twelfth Schedule include the functions like sanitation conservancy and solid waste management.
- Hence it is held that the applicant's services to HMC may be exempted under serial number 3A of the Exemption Notification if the value of goods involved in such composite supply does not exceed 25% of the value of supply.
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